Features to compare when looking to take out a life cover for your parents

Written by 
Bill Tsouvalas
Bill Tsouvalas is the managing director and a key company spokesperson at Savvy. As a personal finance expert, he often shares his insights on a range of topics, being featured on leading news outlets including News Corp publications such as the Daily Telegraph and Herald Sun, Fairfax Media publications such as the Australian Financial Review, the Seven Network and more. Bill has over 15 years of experience working in the finance industry and founded Savvy in 2010 with a vision to provide affordable and accessible finance options to all Australians. He has built Savvy from a small asset finance brokerage into a financial comparison website which now attracts close to 2 million Aussies per year and was included in the BRW’s Fast 100 in 2015 as one of the fastest-growing companies in the country. He’s passionate about helping Australians make financially savvy decisions and reviews content across the brand to ensure its accuracy. You can follow Bill on LinkedIn.
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, updated on June 2nd, 2023       

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Life insurance parents

They have taken care of you from the start and now you want to take care of them when they need it the most. Taking out a life insurance policy can ensure that your parents are covered when they pass on to ease the financial stress of taking care of funeral expenses. Here is what you need to know when taking out a life insurance policy for your parents.

When is it the right time to take out a life insurance policy?

For every visit that you take home to visit your parents you realise that their wrinkles on their face have become deeper and their hair greyer. You also realised that they play an integral role in your life and you will be devastated if you lost them. Although taking out a life insurance policy to cover them may not replace them, but it can ensure that they are buried with dignity. Taking out a life insurance policy is suitable for any time. However, there may be a limit to what type of policies you will have access to based on their age. Life insurance is not only about covering funeral expenses, but it can also be beneficial in the event where your parent is a guarantor on your home loan or they are taking care of your children. Whatever physical and financial support your parents offer needs to be considered when they are no longer around.

The benefits of taking out a life insurance policy for your parents

Your parents can still benefit from having life insurance in more than one way. It can still cover their financial obligations when they are no longer around, but it can also:

  • It can protect them from uncertainties. The older your parents become the more likely they are to be susceptible to falling ill or sustaining an injury. You can provide a safety net with life insurance policies such as Trauma insurance which covers critical illnesses or TPD insurance for total and permanent disabilities.
  • It can continue their supportive role. Taking out a life insurance policy can ensure that the financial support your parents provided is still in place, meaning that it can be used to take care of their partner, grandchildren, and any expenses that they use to help with you with.
  • Cover for people up to 100 years old. Depending on your lender you can find various policies that cover people from a minimum age of 69 years to 100 years.

What policies will be suitable for your parents?

Insurers will differ on the type of policy they provide. Therefore, it will be financially beneficial to compare your options. This also means checking if they meet the criteria. You can also check if it offers tailor-made features for your parents and their circumstances. Some of the policies that can be suitable for your parents are:

  • Funeral insurance is a life insurance policy that pays out a lump sum as soon as your claim is processed. This can be beneficial in taking care of your immediate expenses and other funeral costs that will arise.
  • Accidental death insurance covers your parents in the event when they pass on due to an accident.

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