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How much life insurance do I need?
Life Insurance is there to help out those we love when we no longer can, which is why it’s important to work out how much cover you need. This ‘how much’ question isn’t about a 'one size fits all' solution, but about asking yourself the right questions to work out what level and kind of cover will best suit your budget and your loved ones’ needs.
So what kinds of things should you ask to work out how much life insurance you need?
Start with a list of all the things you currently pay out
Make a list of current ongoing payments, such as:
- Your home mortgage
- Your personal loans
- Your credit cards debts.
Consider what your family would still need
Then consider the things you pay for that your family would still need if you were no longer there to provide for them, such as:
- Education costs – how much will it cost to educate your children right through high school or even university?
- Rent and other bills
- Food and groceries
- Health Insurance
- Car Insurance
- Home and Contents Insurance
- Petrol and car maintenance.
Tally up the cost
Work out the total cost of these items. Then subtract the things you, or your family, could do without – like investment properties, stocks, or cash. The total amount will give you an idea of the level of life insurance cover you need.
To help you get a rough idea, try using our simple life insurance calculator. It can help you work out how much you’ll need to cover your funeral, pay off your debts, and take care of your loved ones once you are gone.
AAMI Life Insurance, AAMI Income Protection and Accidental Injury Insurance are issued by Asteron Life & Superannuation Limited ABN 87 073 979 530, AFSL 229880 (Asteron) other than the Redundancy Benefit which is issued by AAI Limited ABN 48 005 297 807, AFSL 230859 (AAI) trading as AAMI which is part of the Suncorp Group. Asteron is part of the TAL Dai-ichi Life Australia Pty Limited ABN 97 150 070 483 group of companies (TAL). Asteron is authorised to use the AAMI brand. Suncorp Group is distributor of life insurance provided by TAL. The different entities of TAL and Suncorp are not responsible for, or liable in respect of, products and services provided by the other. AAI trading as AAMI does not provide any financial product advice in relation to AAMI Life Insurance, Accidental Injury and Income Protection (except in relation to the Redundancy Benefit) (Life Products). Any advice on this page in connection with the Life Products is general in nature and is provided by Platform Ventures Pty Ltd ABN 35 626 745 177 AFS Representative Number 001266101 (PV). PV is part of the Suncorp Group and an authorised representative of TAL Direct Pty Limited ABN 39 084 666 017, AFSL 243260 (TAL Direct).