Income Protection, Trauma Cover, Total and Permanent Disablement (TPD) and even Life Cover are not getting any cheaper. With rising costs across many aspects of life, insurance premiums are no exception – but there are a few practical ways to help ease the pressure.
Below are some steps that may help keep your cover affordable without compromising too much on protection. As always, it’s important to understand what each change means for your overall plan.
1. Pay yearly instead of monthly
Some insurers charge up to 10 per cent more for the convenience of monthly instalments. If cashflow allows, switching to annual payments can deliver noticeable savings.
2. Turn off automatic annual increases
Many policies automatically increase your sum insured each year to help keep pace with inflation. While this can be valuable over time, it also increases your premium – often by 5–8 per cent annually. If affordability is an issue, you can ask your adviser about pausing or turning off these increases.
3. Quit smoking
If you’ve stopped smoking for at least 12 months, you may be eligible for a lower premium — sometimes reducing costs by up to 50 per cent. You’ll generally need to confirm your non-smoker status with your insurer before the change takes effect.
4. Get healthy and stay healthy
Many insurers offer discounts (often up to 15 per cent) for maintaining a healthy Body Mass Index (BMI) and an active lifestyle. These wellness or “vitality” programs can also include rewards for ongoing participation, so it’s worth asking what your insurer offers.
5. Consider a premium-freeze option
Some insurers allow you to keep your premiums level by reducing the amount of cover slightly each year rather than letting premiums rise. It’s a way to maintain protection within a set budget, though it does mean your cover decreases gradually.
Reviewing your cover
There are many ways to reduce the cost of your insurance, but not all savings are equal. Sometimes the best outcomes come from reviewing and updating older policies, especially where new product options or health changes may work in your favour. The key is to understand the trade-offs before making changes.
A qualified insurance adviser can help you compare options, clarify what each feature does, and ensure your cover still meets your needs – not just your budget.
Important note:
This article provides general information only and does not take into account your personal circumstances. You should consider seeking advice from a financial adviser who specialises in insurance to understand the consequences of any changes to your cover.
Anita has been helping Australians protect what matters most for many years and can guide you through the process with care and clarity. Get in touch here
