How Much Does Life Insurance Cost In Australia?

Are you considering securing your financial future and ensuring your loved ones are protected in case of the unexpected? Life insurance is a crucial financial tool that provides peace of mind and financial security for you and your family. But, you might be wondering, “How much does life insurance cost in Australia?” Well, you’re in the right place! In this comprehensive guide, we’ll delve into the world of life insurance in Australia, exploring its costs, factors affecting premiums, and essential tips to help you make an informed decision.

So, if you’re ready to take action and safeguard your family’s future, let’s dive in and find out how much life insurance costs Down Under!

What Factors Affect Life Insurance Costs in Australia?

Before we answer the burning question of “How much does life insurance cost in Australia?” it’s crucial to understand the factors that influence the cost of life insurance policies. Insurance premiums are not one-size-fits-all, and they can vary significantly based on several key factors:


Age plays a significant role in determining your life insurance premium. Generally, the younger you are when you purchase a policy, the lower your premium will be. This is because younger individuals are statistically less likely to pass away during the policy’s term.

Health and Medical History

Your health and medical history are critical factors. Insurance providers may require a medical examination or review your medical records to assess your overall health. Pre-existing medical conditions or lifestyle factors like smoking can increase your premium.

Coverage Amount

The amount of coverage you choose, often referred to as the sum insured, directly impacts your premium. A higher coverage amount will result in a higher premium. It’s essential to strike a balance between adequate coverage and affordability.

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Policy Type

There are various types of life insurance policies, such as term life, whole life, and universal life. Each type comes with its own cost structure. Term life insurance is generally more affordable compared to permanent life insurance options.


Believe it or not, gender can affect life insurance costs. Statistically, women tend to live longer than men, which means they often pay lower premiums.

Lifestyle and Hobbies

Your lifestyle and hobbies can influence your life insurance premium. Engaging in high-risk activities or hobbies may lead to higher premiums. For example, if you’re an avid skydiver, your insurance provider may consider you a higher risk.

Smoking Status

Smoking can significantly impact your life insurance premiums. Smokers generally pay higher premiums compared to non-smokers. The difference can be substantial, as seen in the table below:

AgeGenderSmoking StatusAverage Monthly Premium (Non-smoker)Average Monthly Premium (Smoker)
Source: Canstar, May 2023, $500,000 sum insured value.

How Much Does Life Insurance Cost in Australia?

Now, let’s get to the heart of the matter – how much does life insurance cost in Australia? To provide a clear answer, we’ll break down the costs based on different scenarios and insurance types.

Term Life Insurance

Term life insurance is one of the most popular and affordable options in Australia. It offers coverage for a specified term, typically 10, 20, or 30 years. Here’s an approximate cost breakdown for a term life insurance policy:

  • Young and Healthy: If you’re in your 20s or 30s, in excellent health, and a non-smoker, you could pay as little as $20 to $50 per month for a $500,000 coverage amount.
  • Middle-Aged: For individuals in their 40s or 50s in good health, premiums might range from $50 to $150 per month for the same coverage.
  • Seniors: Seniors aged 60 and above may pay higher premiums, ranging from $150 to $300 per month for a term life policy.

Remember, these are rough estimates, and your actual premium can vary based on the factors mentioned earlier.

Whole Life Insurance

Whole life insurance provides lifetime coverage and includes an investment component. This type of policy tends to be more expensive than term life insurance due to its permanent nature. Here’s an approximate cost breakdown:

  • Young and Healthy: For young and healthy individuals, whole life insurance premiums can start at $100 to $200 per month for a moderate coverage amount.
  • Middle-Aged: Middle-aged individuals may pay between $200 to $400 per month for a similar policy.
  • Seniors: Seniors seeking whole life insurance should expect higher premiums, ranging from $400 to $800 per month.
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Factors That Can Lower Your Life Insurance Costs

Now that you have an idea of the costs, let’s explore some actionable steps to potentially lower your life insurance premiums:

  • Maintain Good Health: Leading a healthy lifestyle by exercising regularly and maintaining a balanced diet can improve your overall health and lead to lower premiums.
  • Don’t Smoke: Smoking significantly increases the cost of life insurance. Quitting smoking can not only improve your health but also reduce your premiums.
  • Shop Around: Different insurance providers offer varying rates. It’s essential to compare quotes from multiple companies to find the best deal.
  • Bundle Policies: Some insurers offer discounts if you bundle your life insurance with other types of insurance, such as home or auto insurance.
  • Choose the Right Coverage: Avoid overinsuring yourself. Select a coverage amount that meets your needs without exceeding them. Paying for excessive coverage can be costly.

How Your Occupation Impacts Life Insurance

Your occupation can influence your life insurance premiums. While default life insurance through superannuation is generally unaffected by your job, when seeking separate life insurance, high-risk occupations may lead to increased premiums or certain conditions or exclusions. Some examples of high-risk jobs include miners, construction workers, healthcare professionals, and more.

The Financial Services Council has introduced standards to ensure that default group life insurance in superannuation remains accessible even when changing jobs. However, when considering separate life insurance, it’s essential to assess how your occupation may impact your coverage and premiums.

The Impact of Smoking on Premiums

If you’re a smoker, quitting can significantly reduce your life insurance premiums. The tables provided by Canstar demonstrate the substantial cost difference between smokers and non-smokers. Keep in mind that most insurers consider you a non-smoker if you’ve refrained from smoking for at least 12 months. It’s essential to update your smoking status with your insurance provider to secure lower premiums. Failing to disclose smoking habits can have consequences, even if it’s an occasional occurrence.

Choosing the Right Life Insurance

Selecting the best life insurance policy involves careful consideration of your unique circumstances. It’s essential to balance cost-effectiveness with adequate coverage. While there isn’t a single “best” insurance provider, conducting thorough research and assessing your needs will lead you to the right decision.

TAL, AIA Australia Limited, and Zurich are among the leading insurance companies in Australia, each offering unique advantages. TAL, for instance, doesn’t cap the coverage amount, providing flexibility for policyholders.

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Determining Your Coverage Amount

Calculating the ideal life insurance coverage amount can be daunting. A common approach is to multiply your annual salary by ten and then add an extra $100,000 for each dependent. Another method involves multiplying your annual salary by the number of years left until your expected retirement.

Average Monthly Costs

To give you a clearer picture of average costs, consider these examples:

  • A non-smoking female in her twenties can expect to pay around $28 per month.
  • A non-smoking male in his twenties may pay approximately $47 per month.
  • On the other end of the spectrum, a male smoker in his fifties might face a monthly premium of $496, while the female equivalent could pay around $338.

FAQs: Your Burning Questions Answered

How Much Does Life Insurance Cost for Seniors in Australia?

The cost of life insurance for seniors in Australia can vary widely based on factors like age, health, and the type of policy. On average, seniors can expect to pay higher premiums compared to younger individuals. Premiums for seniors can range from $150 to $800 per month, depending on their specific circumstances.

Can I Lower My Life Insurance Costs If I Quit Smoking?

Absolutely! Quitting smoking is one of the most effective ways to lower your life insurance costs. Smokers generally pay significantly higher premiums than non-smokers. After quitting, you can reapply for insurance as a non-smoker, which may result in lower premiums.

Is Life Insurance More Expensive for Men in Australia?

Statistically, women tend to live longer than men, which can lead to lower life insurance premiums for women. However, the difference in premium costs between genders may not be substantial, and other factors like age and health play a more significant role in determining premiums.

Can I Get Discounts on Life Insurance by Bundling with Other Policies?

Yes, many insurance providers offer discounts when you bundle life insurance with other insurance policies, such as home or auto insurance. Bundling can help you save money on your overall insurance costs.

What Type of Life Insurance is the Most Affordable in Australia?

Term life insurance is generally the most affordable type of life insurance in Australia. It offers coverage for a specific term and does not include the investment component found in whole-life insurance, making it a cost-effective choice for many individuals.


In conclusion, the cost of life insurance in Australia varies depending on various factors, including your age, health, coverage amount, and the type of policy you choose. To determine “How much does life insurance cost in Australia?” for your specific situation, it’s essential to obtain quotes from multiple insurance providers and consider the factors that can influence your premiums.

Remember that investing in life insurance is an investment in your family’s financial security. While the cost may seem like an additional expense, the peace of mind and protection it provides in times of need are priceless. So, take action today, explore your options, and secure a brighter future for yourself and your loved ones with the right life insurance policy!