You can readily obtain life insurance in Australia if you are over 50. While premiums are higher than for younger applicants, many providers offer specialised over-50s policies with guaranteed acceptance and no medical exams, specifically designed to help your family manage funeral costs or clear final debts.
Why Consider Life Insurance After 50?
Turning 50 often brings a shift in financial priorities. While your children might be older and gaining independence, you may still carry significant financial obligations. Securing life insurance in your 50s is primarily about protecting your loved ones from inheriting your liabilities.
Many Australians in this age bracket take out policies to:
- Clear the Mortgage: Pay off the remaining balance on the family home so your partner is not forced to downsize.
- Cover Final Expenses: Provide a lump sum to handle funeral costs and legal fees associated with estate settlement.
- Leave a Legacy: Guarantee a financial inheritance for your children or grandchildren.
Types of Cover Available for Over 50s
When you are over 50, you generally have two main pathways for securing a policy. The right choice depends on your current health status and how much financial protection your family requires.
1. Fully Underwritten Retail Life Insurance
This is a standard life insurance policy. It requires a full health assessment, which means you must disclose your medical history. The insurer may request a blood test or a report from your general practitioner. Because the insurer has a clear picture of your health, retail life insurance typically offers much higher payout amounts (often in the millions) and more competitive long-term pricing for healthy applicants.
2. Specialised Over 50s Cover (Guaranteed Acceptance)
If you have pre-existing medical conditions that make standard insurance too expensive or impossible to get, guaranteed acceptance policies are the alternative. As the name suggests, you cannot be declined based on your health, and no medical exams are required. However, these policies usually cap the maximum payout between $15,000 and $25,000, making them best suited for covering funeral expenses.
How Much Does It Cost?
Age is a primary factor in calculating insurance premiums. Because the statistical risk of a claim increases as you get older, premiums for a 50-year-old will be noticeably higher than those for a 30-year-old.
To give you a baseline, a healthy 50-year-old non-smoking male might pay between $80 to $130 per month for a $500,000 fully underwritten life insurance policy. A non-smoking female of the same age might pay between $60 to $100 per month.
Note: These are estimates. Smoking status, past medical events, and high-risk occupations will increase these baseline premiums. Requesting a direct quote is the only way to lock in an accurate price.
Holding Cover Inside Superannuation
Many Australians over 50 choose to pay their insurance premiums using their superannuation balance rather than their daily cash flow. While this eases the pressure on your immediate household budget, it requires careful strategy.
Withdrawing premiums from your super fund for another 10 or 15 years can significantly deplete your final retirement balance. Furthermore, changes to superannuation laws mean that life insurance payouts from a super fund can sometimes be subject to tax if the money goes to a non-financial dependent (like an adult child). Always seek professional financial advice before structuring your policies this way.
Frequently Asked Questions
Is there a maximum age limit to apply?
Yes. For most fully underwritten retail policies, the maximum entry age is usually between 70 and 75. For guaranteed acceptance over-50s policies, providers often accept new applications up to age 80.
Are life insurance premiums tax-deductible?
No. If you hold a standalone life insurance policy outside of your superannuation, the Australian Taxation Office (ATO) does not allow you to claim the premiums as a tax deduction. However, the lump-sum payout provided to your beneficiaries is entirely tax-free.
Do I have to take a medical exam?
Only if you apply for a fully underwritten policy with a high benefit amount. If you opt for a guaranteed acceptance policy or a basic funeral plan, no medical exams or blood tests are required.
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