A report compiled by comparethemarket.com.au has found many Australians without life insurance are aware of the financial impact on their families should they die.

The survey of 1100 uninsured Australians found 50 per cent of those surveyed believed having life insurance was too expensive, 19 per cent never considered the financial ramifications of their deaths on their families, while 12 per cent thought life insurance was only for wealthy people.

“Life insurance can cost less than $50 a month and can pay out a $40,000 lump sum,” said Abigail Koch from Compare the Market. “Comprehensive car insurance for $40,000 often costs more than $50 a month. With this in mind, it’s surprising more people don’t take out life insurance given its benefits.

“One in five families face the death or illness of a parent leaving them unable to work,” she continued.

“Life insurance can be incredibly affordable if you live a healthy lifestyle. You can cut the cost of life cover by not smoking and staying in shape.”

One trick is to structure your insurance payments through your superannuation. It doesn’t mean you’ll be able to pay all of your fees, but a sizeable chunk of them may be met by your superannuation earnings.

The idea is that the payout should at least be able to repay your outstanding debts, cover funeral costs, and leave some money for your family to replace your lost earnings.

A report compiled by Zurich and the Financial Planning association found that 60 per cent of Australians have term life insurance cover, 60 per cent of which is held through super.

Of course, those who disagree with super point to instances of insurers haggling over payout figures when the recipients are at their most vulnerable. They also make the point that insurance is the ultimate in betting against yourself – To get lower premiums you need to live a healthy lifestyle, but in living a healthy lifestyle you will pay more in premiums (because you’re likely to live – and keep paying – longer).

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