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Life Insurance Australia

Most of us have heard of Life Insurance and appreciate that it is a policy provided by an insurance company, that pays out either a lump sum or a series of payments when you die. These payments are normally paid without the deduction of any tax, and in most instances are tax-free.

The proceeds of a policy can used:

to pay off a debt such as a mortgage
to provide an income for your dependents
as a savings scheme.

Life policies can be combined with other forms of cover, such as Trauma and Total Permanent Disability Insurance so that you receive the lump sum if you are diagnosed with a serious illness.

Trauma and Total Permanent Disablement Insurance

Total and Permanent Disability Insurance (TPD) is normally an optional extra cover on a life policy and commonly covers against some permanent disability which prevents you from working in your chosen occupation. The amount of disability required varies - for example a surgeon might be considered totally disabled through the loss of one hand. The amount of cover you can buy is limited to the amount of the life cover purchased.

You could use the cash payment from a policy either to pay off a debt (such as a mortgage) or to provide you with an income if you become too unwell to continue working.