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Nobody really likes to think about death, or what happens when you're not there, but when it comes to life insurance, it's important to take a moment to think about it. Taking out a life insurance policy means ensuring that your dependent family members can meet their cost of living if you were no longer around to support them. There are a number of life insurance providers in Australia and to help narrow your choice before getting a quote, you can use our table above to compare your options. But if you need a little more information to help you better understand some of the features and benefits of the policy before you get started, take a look at some frequently asked life insurance questions below : How life insurance works in Australia, when someone passes away, insurance providers pay a lump sum to the beneficiaries appointed by the insured person. In most cases, the beneficiaries are immediate family members and several insurance providers have varying limits on how many people can be nominated on a single policy. Some insurers also pay people who have been diagnosed with a terminally ill patient so that they can cover any medical bills and fix their financial situation. The type of life insurance you are looking for will determine what is covered by your policy. Here are the different types you can take out: Lifetime coverage: this coverage pays your beneficiaries who have named a lump sum on your policy when you die. What is the term life insurance? This is the standard type of life insurance, which pays a lump sum in the event of death (typically up to 99 years). With time-based life insurance you indicate an amount for which you want to insure your life. This amount can be used to cover things like mortgage, child rearing, debts, current partner income, and even funeral expenses. How Much Coverage Will I Need? The amount of life insurance coverage you need will depend on your personal financial circumstances and budget. Life insurance is designed to cover expenses that your income would otherwise have covered. So when calculating the amount of coverage you need, be sure to consider things like: mortgage repayments and other debts as a car loan. Future education expenses for your dependent family members Personal expenses for your partner or family. Remember that you should calculate your living expenses for the rest of the time your family has depended on you. Important future purchases that your income would help with, such as a home, car or renovation Instead of simply looking for the cheapest option, you should really be looking for a policy that affects your family and their style of life. According to some insurance experts, if you have dependents, you should seek coverage equal to 10 times your income. If you need help with the calculations, go to Mozo's budget calculator. When should I buy life insurance? dollar question: when should i actually take out a life insurance policy? There are a few things to consider that can help you find the right time to start considering life insurance seriously: life insurance premiums generally increase with age, so it's a good idea take out the policy when you are healthy, first if you have known pre-existing medical conditions that could affect your likelihood of getting coverage. It is a good idea to take out life insurance as soon as you have important financial commitments such as a home loan or you have people who depend on your income. So once you start a family, life insurance is a big next step: important – and complicated! – The thing is, you have to start thinking about life insurance before you need it. Don't wait for a disaster to break out before finding the right policy for you, because that's exactly the type of situation life insurance is designed to protect you from. How do I pay for life insurance? The person holding the life insurance policy pays premiums to the insurer, usually on a monthly or annual basis. This can be done in the form of gradual premiums, which means that the insurer increases the amount to be paid each year due to aging (and generally your premiums are more expensive, the older you are) or level awards. Level premiums mean that you will pay the same amount while the insurance policy is active and the cost of the premium depends on how old you were when you signed up for the policy. In some cases, you can pay tier prizes up to a certain age, and then you will have to pay tier prizes later. Will I have to undergo a medical examination before taking out a policy? Worried that taking out a life insurance policy means getting hit and paced, measured and weighed? Not be! In most cases, it is not necessary to undergo a medical examination. Usually, medical tests would only be needed if you have had a pre-existing condition or a bad family history and it is very important that when you apply for life insurance you are ahead of your past medical history. Even if you had a pre-existing condition, this does not automatically mean that you will not be able to take out life insurance. In some cases you may have to pay extra or have a policy with special conditions attached. But keep in mind that in the end it is up to the life insurer whether it will require you to undergo medical tests or not. Is life insurance through my super or autonomous policy better? It's up to you: different options are better for different people. To help you decide which is right for you, here is a quick rundown of the pros and cons of each option. Life insurance through your super often cheaper than a standalone policy and won't affect your daily budget, as is taken without money which you don't have access to anyway. It doesn't always offer the same level of coverage as an autonomous policy and eats in your pension fund – you'll need to plan this in your long-term savings strategy. Policy They often offer more functionality and better coverage, and you also have the opportunity to look around and find the policy that suits your needs and budget. Often more expensive than insurance through your super, it also means that you have to do the job of choosing the right policy. For a complete view of the differences, see our guide to super life insurance policies vs. autonomous policies. Does life insurance include income protection and disability insurance? Many life insurance policies are available with the option of total and permanent disability ins urance. This policy covers you in case you end up not being able to work again, in any occupation or in your usual occupation, depending on your policy. On the other hand, income protection insurance usually involves a separate policy. It is an insurance designed to cover utility bills, loan repayments or other expenses if you lose the ability to earn revenue, whether due to injury, illness or other events. A tip: you will often receive a discount to take out multiple policies with a single insurer, so it is worth thinking about putting them all in one place. Where can I find a life insurance policy that suits my needs? Go to our life insurance comparison chart above to start comparing the features and benefits of the different policies to find the right one for your needs.If you are looking for more information on life insurance, we also have a set of guides. which go beyond the basic types of coverage and the information needed to choose life insurance coverage. And if you want to know more about the industry in general, check out our section on life insurance news. How can I apply for a life insurance? There are several ways to buy life insurance. You can consult a consultant or find it yourself and apply online or by phone. If you have a hard time figuring out exactly what you need to be covered for, looking for life insurance through a consultant may be the best option for you. This will give you expert help when you compare policies according to your needs, but you will be subject to a consultancy fee. You may be in charge of finding your policy, so in this case you can simply apply online or by phone. Be ready with information such as your personal data, type of job, amount of income and how much you want covered. Alternatively, you may not be aware that you are receiving life insurance through your pension. While this coverage is cheaper and can cover the basics you need, there are often more limitations, so standalone coverage can better suit your particular situation. Can I cancel my life insurance? Yes, you can cancel life insurance, however the insurer will not refund the premiums you have already paid. Some life insurance policies have a cooling off period, where you can choose to cancel up to 30 days after purchasing the policy and it will be refunded to you. Keep in mind that once your life insurance is canceled, you will no longer be covered even if you have already paid some premiums until canceled.