Life Insurance Calculator
I would like my cover amount to include –
Life Insurance Calculator
Calculator Purpose, Assumptions Disclaimer
The purpose of this calculator is to help you come up with a rough estimate of how much Life insurance you might need. This calculator cannot take into consideration all of your personal circumstances and these inputs are not a full list of factors that you should consider when you decide on a cover amount.
The outputs are only estimates, based on the assumptions explained in this document. They are not intended to be relied on for the purposes of making a decision in relation to a financial product and are not a recommendation that the output is a suitable or sufficient amount of insurance for you.
You should not make a decision solely in reliance on the results produced by the calculator. Before you make a decision about insurance you should consider obtaining advice from a qualified financial adviser that is tailored to your circumstances, and always read the applicable Product Disclosure Statement,
which will help you to decide if the product is suitable for you.
The estimate produced by the calculator is reflective of your answers at the time you use the calculator. However, your circumstances and insurance needs may change over time. It is important to review your cover regularly to ensure that you and your family are adequately insured.
The calculator does not take into account the effect of any taxes or levies that may be payable with respect to the amounts insured. These may have an effect on the final benefit receivable. For example, income tax is generally payable on monthly income protection benefits.
The calculator does not take into account any increase in expenses due to inflation over time, which means the outputs are displayed in today’s dollars. In reality, the cost of living is likely to increase over time. However, most insurance policies include a feature which allows you to index your cover to inflation each year (up to specified limits), which may help keep the value of your cover more constant.
If you purchase a life insurance product, you should also review your cover regularly especially when your life circumstances change – for e.g. if your income changes, your family grows, you buy a new home, or you get married – to ensure that your cover remains adequate and appropriate to your circumstances.
Assumptions:
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Funeral or other immediate out of pocket costs
Funerals in Australia may cost anywhere between $4,000 and $15,000 according to MoneySmart (reference 2).
$15,000 could also help you or your family pay for other immediate out of pocket costs that might arise, such as medical treatment or devices or legal fees.
You can choose a different amount by adjusting this assumption.
2 years is considered to be a reasonable period of time, for your family to adjust their new living expenses.
However, depending on your circumstances a different period may be appropriate. Living expenses may change from year to year, however this is not taken into account by the calculator.
Reference 2
MoneySmart, ‘Paying for your funeral’.
Available at: https://moneysmart.gov.au/living-in-retirement/paying-for-your-funeral
[Accessed on 8 March 2024]