Direct vs retail vs super life insurance

• No middleman: Buying directly means no additional fees outside your policy.
• You call the shots: You can tailor your policy, including how much you insure for and which features you include.
• Choice of premiums: You can choose to pay in stepped or level premiums. Stepped premiums tend to start cheaper but will increase over time, while level premiums remain the same for the length of the policy.

Cons

• All on you: You're in charge of researching and understanding everything. Ultimately, whether you find a policy that fits your needs depends on the time and effort you put in.
• Costly choices: Premiums are generally higher than retail or group insurance.
• Pre-existing conditions: Not all conditions are covered automatically, and some might be excluded for a period or not covered at all.

• Cost effective: It's often cheaper, because policies are bought in bulk by superfunds.
• No medicals required: Unlike policies bought directly or through advisors, you won't usually have to supply your medical history or complete a medical examination.
• Convenient: Premiums are taken directly from your super balance, so it won't impact your current cash flow. Not having to maintain a standalone policy can also mean less paperwork and admin.

Cons

• Portability: If you change funds, your cover might end. Super funds are required to cancel insurance on accounts that are inactive for 16 continuous months.
• Reduces super: Because your premiums are paid by your super balance, you'll accrue less interest and have less sitting in your retirement fund when you're ready for it.
• Cover can be limited: The standard benefit amount is usually between $100,000 and $200,000. That may seem like a lot, but it's generally suggested that your life insurance is around 5 to 10 times your annual salary.

• Cost effective: Often cheaper thanks to bulk purchasing by the employer.
• Automatic cover: You'll usually be automatically covered if you're an employee.
• Employer pays: If it's part of your employment benefits, your premiums may be paid partially or fully by your employer.

Cons

• Portability: If you leave your job you could lose your cover. Some insurers will let you keep your cover, but it can come with a higher premium.
• Lower cover: The standard benefit for group life insurance policies is between $100,000 and $200,000. This may not be enough for you and your family's needs if you pass away.

• Reliable and secure: You'll be fully assessed both medically and financially before your application is approved, which gives you assurance that you should be fully covered when it's time to make a claim.
• Access to more complex products: Some advisors will be able to find you policies that are customised exactly to your needs. Many of these products won't be available if you go through other channels.
• Expert advice: Whether it's a pre-existing condition or a dangerous occupation, advisers have the expertise to help you understand your needs and what you should be looking for in a life insurance policy.

Cons

• Portability: If you leave your job you could lose your cover. Some insurers will let you keep your cover, but it can come with a higher premium.
• Lower cover: The standard benefit for group life insurance policies is between $100,000 and $200,000. This may not be enough for you and your family's needs if you pass away.
• Comprehensive checks: Retail life insurance is the most involved when it comes to medical underwriting. Along with sharing medical records and completing a detailed medical and lifestyle questionnaire, you may have to complete a medical exam.
• A lengthy process: Consulting an adviser, receiving a statement of advice, and finally setting up your life insurance policy, can take a lot of time. Expect periods of up to 8 weeks before being insured.