Do I Need Life Insurance?

Short Answer

Simply put, it's an agreement between you and an insurer that if something happens to you, a lump sum of money is paid to your beneficiaries (your partner, kids or dependants) in the event you pass away or are diagnosed with a terminal illness. It's a way to protect those who depend on you financially, covering things like the mortgage, your children's education costs, and everyday living expenses.

You'll also hear "life insurance" used as a catch-all for a few different covers, TPD, trauma and income protection. They each do a slightly different job, and we'll get to all of them below.

Life insurance is one of those things most Aussies don't think much about, until something changes. Buying a home, starting a family, or realising that other people depend on your income has a way of bringing the question into focus.

The good news is it doesn't need to be complicated. Below, we'll break down how it works, what it covers, and how to work out whether you need it.