A life insurance policy is a guarantee on the life of the insured person. When the insured person dies, the insurance policy will give their beneficiaries a specific amount of money. The insured person makes a payment, known as a life insurance premium, usually on a monthly basis for a given period of time.
How do we know which life insurance policy is best for us? There are a few factors to consider like:
The type of life insurance
In Australia there are two main types of insurance offered by insurance companies.
Term life insurance policy
Term life insurance policies pays out to the insured person’s beneficiaries as long as the insured person passes away within the fixed term specified in the term life insurance policy. For example, a 99 year term life insurance policy would pay out only if the insured person passed away within the 99 years specified.
Select term life insurance
This is a type of term life insurance where the fixed term specified is usually only a brief five or ten years. As with the standard term life insurance policy, a 5 year term life insurance policy would pay out only if the insured person passed away within the 5 years.
Amount of life insurance coverage needed
The general guideline is between five and ten times your annual salary. But as stated, this is only a guideline. It's difficult to apply a rule-of-thumb because the amount of life insurance you need depends on factors such as your other sources of income, how many dependents you have, your debts, and your lifestyle.
The life insurance premium
The amount of the life insurance policy premium is usually determined by factors such as the age of the person, their gender, occupation, whether or not they smoke, medical history, along with the amount that is required to be paid out on death.
When choosing life insurance, use the Internet's resources to educate yourself about life insurance basics, find a adviser you trust, then have the policies he or she recommends evaluated by an online comparison insurance quote service or fee-only insurance advisor. The bottom line is that the average person does need life insurance and that cheaper doesn’t always mean better – make sure you shop around!
Showing posts with label life insurance policies. Show all posts
Showing posts with label life insurance policies. Show all posts
Wednesday, June 16, 2010
Best life insurance policies in Australia
Unfortunately, the best life insurance policies in Australia will vary as it depends on which policy is best suited to your needs. However thanks to the internet, buying and finding a life insurance policy which suits your needs has never been easier.
The good thing about buying life insurance online is that most life insurance comparison services are free. They can also compare a number of life insurance quotes at the same time, saving you valuable time.
Which companies compare the best life insurance policies?
Make sure you choose a reputable life insurance comparison service. A reputable life insurance comparator will compare Australia’s top life insurance companies and ask you a number of questions. The greater the amount of questions asked, the higher the chances you have of paying lower premiums.
Some of the top companies that an online comparator should compare include:
• AIA Insurance
• AMP Insurance
• Asteron Insurance
• Aviva Insurance
• AXA Insurance
• CommInsure Insurance
• ING Insurance
• Macquarie Insurance
• MLC Insurance
• Tower Insurance
• Zurich Insurance
Do the best life insurance policies offer discounts?
It really depends on the online life insurance comparator you go with, but many offer promotional discounts, either in whole or on the first month’s premium.
Some life insurance companies also offer discounts if your spouse also purchases a life insurance policy. This equates to a saving of around $5-$8 per month, which can equate to hundreds of dollars over the life of a policy.
Should I only buy the best life insurance policies?
At the end of the day it is your choice, however if you are in doubt you should speak to a qualified financial adviser. Most online life insurance comparison services will also have financial advisers available to discuss your personal situation. No matter where you buy life insurance from it pays to get sound financial advice.
Buying the right life insurance policy can save you money, as well as ensuring that your loved ones are cared for should the worst happen. Make sure you review your life insurance policy annually so that it is kept up to date, and to ensure that the level of cover you have is enough.
Save time and find the best life insurance policies in Australia
Using an online life insurance comparator can save you both time and money. Why not contact your local insurance comparator to discuss your needs and get some life insurance quotes? They can answer any questions or concerns you have, and can suggest a policy that is competitively priced to meet your needs.
The good thing about buying life insurance online is that most life insurance comparison services are free. They can also compare a number of life insurance quotes at the same time, saving you valuable time.
Which companies compare the best life insurance policies?
Make sure you choose a reputable life insurance comparison service. A reputable life insurance comparator will compare Australia’s top life insurance companies and ask you a number of questions. The greater the amount of questions asked, the higher the chances you have of paying lower premiums.
Some of the top companies that an online comparator should compare include:
• AIA Insurance
• AMP Insurance
• Asteron Insurance
• Aviva Insurance
• AXA Insurance
• CommInsure Insurance
• ING Insurance
• Macquarie Insurance
• MLC Insurance
• Tower Insurance
• Zurich Insurance
Do the best life insurance policies offer discounts?
It really depends on the online life insurance comparator you go with, but many offer promotional discounts, either in whole or on the first month’s premium.
Some life insurance companies also offer discounts if your spouse also purchases a life insurance policy. This equates to a saving of around $5-$8 per month, which can equate to hundreds of dollars over the life of a policy.
Should I only buy the best life insurance policies?
At the end of the day it is your choice, however if you are in doubt you should speak to a qualified financial adviser. Most online life insurance comparison services will also have financial advisers available to discuss your personal situation. No matter where you buy life insurance from it pays to get sound financial advice.
Buying the right life insurance policy can save you money, as well as ensuring that your loved ones are cared for should the worst happen. Make sure you review your life insurance policy annually so that it is kept up to date, and to ensure that the level of cover you have is enough.
Save time and find the best life insurance policies in Australia
Using an online life insurance comparator can save you both time and money. Why not contact your local insurance comparator to discuss your needs and get some life insurance quotes? They can answer any questions or concerns you have, and can suggest a policy that is competitively priced to meet your needs.
Sunday, May 2, 2010
How to compare life insurance policies in Australia
Life insurance pays your estate or beneficiaries a lump sum should you die. However purchasing a life insurance policy in Australia is different compared to overseas life insurance policies, such as those from the U.S. The Australian life insurance products are structured differently, and as a result it can make online research difficult to accomplish. There are a number of questions you should ask yourself when thinking about purchasing life insurance in Australia. These are things like:
• which life insurance company to go with
• which life insurance policy product to select
• how much life insurance cover you need
• if you also need TPD (total and permanent disability insurance) and trauma insurance or income protection
Let’s delve into each point a little more:
1. Compare the top life insurance companies in Australia
There are a number of life insurance companies in Australia, and some of these companies operate world-wide. One of the best ways to check if a life insurance company is trustworthy is to check their rating. To ensure your life insurance policy is with a top company, you should choose a company with a AA or AAA rating.
To make things easier for you, we have listed the top life insurance companies operating in Australia:
• AIA (formerly AIG)
• AMP life insurance
• Asteron
• Aviva
• AXA
• CommInsure
• ING
• Macquarie
• MLC life insurance
• MetLife
• Suncorp
• Tower life insurance
• Zurich
2. Compare the different types of life insurance policies
In Australia the main type of life insurance product available is Term Life Insurance. This type of insurance typically covers you up to age 99 or 100. However some select life insurance companies also offer 5, 10 or 15 year term life insurance policies.
Within term life insurance policies, you have the option of choosing to pay either stepped or level premiums. The most common option is stepped premiums, where the cost of your premiums increases with your age. The other option is level premiums, where the premiums stay the same to a certain age, usually up to age 65.
It should be noted that the choice of stepped or level premiums depends on what suits your particular situation. The cost difference between stepped and level premiums of each policy has its pro’s and cons. If you are in doubt be sure to speak to your financial adviser.
3. Calculate how much life insurance cover you need
As a general rule of thumb, the average Australian would need approximately ten times their annual income. If you have additional loans or mortgages for residential or commercial properties, you may like to factor these in as well.
If you have any dependents like children, or elderly parents to care for, take a minute to consider what would happen to them should you pass away. There are childcare, nanny, school and possible hospice-care costs that could add up. If there is a significant monetary value in having your loved ones taken care of, you should factor in these costs too.
4. Do you also need TPD Insurance?
Many life insurance companies bundle their TPD insurance with their life insurance policies. Purchasing a bundled policy can save you money, compared to purchasing a two different policies. However, once a claim is made on a bundled policy, you may not be able to make a second claim later on. An example of this is a person with a bundled policy of $500,000 for both life insurance and TPD insurance. If they make a claim due to becoming totally and permanently disabled, when they die, another claim can usually not be made. This is because the TPD claim reduces the life insurance sum insured.
These bundled policies may or may not have a sufficient level of cover to claim for both TPD insurance and life insurance. If you are in doubt or have any additional questions please contact your financial adviser. A qualified financial adviser can help you decide on the above factors, and ultimately which life insurance policy would best suit your situation.
• which life insurance company to go with
• which life insurance policy product to select
• how much life insurance cover you need
• if you also need TPD (total and permanent disability insurance) and trauma insurance or income protection
Let’s delve into each point a little more:
1. Compare the top life insurance companies in Australia
There are a number of life insurance companies in Australia, and some of these companies operate world-wide. One of the best ways to check if a life insurance company is trustworthy is to check their rating. To ensure your life insurance policy is with a top company, you should choose a company with a AA or AAA rating.
To make things easier for you, we have listed the top life insurance companies operating in Australia:
• AIA (formerly AIG)
• AMP life insurance
• Asteron
• Aviva
• AXA
• CommInsure
• ING
• Macquarie
• MLC life insurance
• MetLife
• Suncorp
• Tower life insurance
• Zurich
2. Compare the different types of life insurance policies
In Australia the main type of life insurance product available is Term Life Insurance. This type of insurance typically covers you up to age 99 or 100. However some select life insurance companies also offer 5, 10 or 15 year term life insurance policies.
Within term life insurance policies, you have the option of choosing to pay either stepped or level premiums. The most common option is stepped premiums, where the cost of your premiums increases with your age. The other option is level premiums, where the premiums stay the same to a certain age, usually up to age 65.
It should be noted that the choice of stepped or level premiums depends on what suits your particular situation. The cost difference between stepped and level premiums of each policy has its pro’s and cons. If you are in doubt be sure to speak to your financial adviser.
3. Calculate how much life insurance cover you need
As a general rule of thumb, the average Australian would need approximately ten times their annual income. If you have additional loans or mortgages for residential or commercial properties, you may like to factor these in as well.
If you have any dependents like children, or elderly parents to care for, take a minute to consider what would happen to them should you pass away. There are childcare, nanny, school and possible hospice-care costs that could add up. If there is a significant monetary value in having your loved ones taken care of, you should factor in these costs too.
4. Do you also need TPD Insurance?
Many life insurance companies bundle their TPD insurance with their life insurance policies. Purchasing a bundled policy can save you money, compared to purchasing a two different policies. However, once a claim is made on a bundled policy, you may not be able to make a second claim later on. An example of this is a person with a bundled policy of $500,000 for both life insurance and TPD insurance. If they make a claim due to becoming totally and permanently disabled, when they die, another claim can usually not be made. This is because the TPD claim reduces the life insurance sum insured.
These bundled policies may or may not have a sufficient level of cover to claim for both TPD insurance and life insurance. If you are in doubt or have any additional questions please contact your financial adviser. A qualified financial adviser can help you decide on the above factors, and ultimately which life insurance policy would best suit your situation.
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