By and large Australians are underinsured especially when it comes to life insurance. As per a report from the Financial Services Council, a mere five percent of families in Australia with dependent children are adequately insured for life insurance cover. An extensive study conducted by the insurance industry found that in a typical Australian family only 56 percent of the total income was covered by a life insurance policy taken in the name of the main breadwinner, which is way less than the recommended level of eighty percent.

Furthermore less than a third of Australian population has their income protected by any kind of insurance. This is despite the fact that 3 out of four Australians are diagnosed with serious illnesses or suffer from accidents during their working life, according to figures released by Australian Bureau of Statistics. .

According to Stephen Mitchell of Canstar Cannex, the life insurance deficit could have been worse if the super funds did not provide life insurance cover. However the cover provided through the superfunds is not enough, in fact it is low level and one-size-fits-all. Most people take it as some insurance cover is better than no insurance cover. And being covered under the superfunds they think they are safe whereas actually they are not.

As a matter of fact, life insurance is very much a jigsaw puzzle with just 4 pieces – death cover, TPD, trauma insurance and income protection. It is up to the individual to fit the pieces in a way that they get the best benefit from the premiums. Income protection is the most expensive of all insurance coverage; compare insurers at to get a clear idea of who has what to offer. Most people are put off by this ‘expensive’ tag but the industry expert will be able to advice you on how it should fit with the other insurance products to provide you a hundred percent cover.

Insurance companies in Australia are aware of the inhibitions Australians have towards life insurances and are revamping or adding new benefits to their life insurance to make it more lucrative to the general public. Take for instance the Active Life product from Macquarie Life that allows you continual cover even as it allows you multiple claims. Most of the life insurance policies have TPD and death trauma linked and so a claim on trauma cover will decrease the final payout for both of them. And if you are paid out the entire cover amount for trauma you can never have that cover again unless you have got buyback, reinstatements etc. chalked out when you initially take the policy out. On the other hand Active Life from Macquarie will allow you to make smaller claims of say 5 percent on a melanoma treatment and a year or so later you can claim 40 percent for the stroke you suffered and so on. Even though the final payout may get affected, your cover remains intact.

With many more such offers and benefits, you can compare insurers at to find he best contract in the insurance market.

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