The prices and benefit payouts below are based on a 35-year-old, non-smoking accountant with no pre-existing conditions listed. Quotes checked across 4 brands in September 2022.
Monthly income (Pre tax)
Average cost per month (male)
Average cost per month (female)
Monthly Payout Range
$4,000
$59.98
$69.59
$3,000
$5,000
$74.79
$86.80
$3,750
$6,000
$89.59
$104.01
$4,500
$8,000
$119.21
$138.43
$6,000
$10,000
$148.82
$172.85
$7,500
$12,000
$178.44
$207.27
$9,000
$14,000
$199.89
$231.92
$10,000 - $10,500
Finder survey: Have life insurance premiums for people gone up in the last 12 months?
Response
Female
Male
I don't have life insurance
55.01%
44.71%
Yes
21.62%
25.6%
No
9.14%
15.03%
I don't know
14.24%
14.66%
Source: Finder survey by Pure Profile of 1110 Australians, December 2023
Compare options and get personalised income protection costs
1 - 3 of 7
What factors impact income protection costs?
Age: Premiums will increase with age because you are more likely to be susceptible to medical conditions.
Your gender: Women are generally considered to be more susceptible to pre-existing medical conditions so pay more.
Smoking status: You may pay as much as 50% more for income protection insurance if you are a smoker.
Pre-existing medical conditions: There are conditions that will be excluded automatically and others that you may receive cover for if more information is provided.
Lifestyle factors: Potentially dangerous hobbies such as dirt bike riding may result in an increase of the premium.
The waiting period you choose: A shorter waiting period (so you can get paid sooner) will result in a higher premium.
Benefit period you choose. The longer your benefit period (the time you're paid for) the higher the premium.
How occupation and income can influence income protection costs
Both occupation AND income can affect the cost of cover. For example, a retail supervisor and a registered nurse who earn $4,000 a month will pay a different premium on income protection.
Likewise, a medical specialist may have a higher income to insure than a general doctor. This, along with the occupation category can mean a difference in premiums.
Income**
Average monthly premium*
Retail Supervisor
$4,000
$92.51
Doctor
$12,000
$185.10
Specialist Medical Practitioner
$15,000
$220.54
Registered Nurse
$4,000
$138.34
Machinist (Metal or Wood)
$4,000
$154.57
Building Industry, Supervisor
$4,000
$115.73
*Average monthly premium is based on the average premium of all policies available in finder's quote engine for both males and females. Quotes are based on non-smoking 35 year old in NSW. Income levels are for illustrative purposes and not as a definitive guide.
Stepped premiums will increase over time in line with your age. They are a more affordable option at the start of your policy but increase steadily overtime...particularly once you have reached 40 years of age.
Level premiums
Level premiums will start out higher than stepped but will remain the same for the life of the policy. Generally level premiums will end up being more affordable in the long run.
The graph below gives you an idea of how stepped and level premiums differ based on annual premuiums (on the left) and years (at the bottom). There is also a line for hybrid premiums – some insurers also offer this.
Year
Stepped
Levelled
Hybrid
5
$1800
$2000
$1900
10
$1900
$2000
$2000
15
$2000
$2000
$2100
20
$2100
$2000
$2100
25
$2200
$2000
$2100
30
$2300
$2000
$2100
Increase over time (%)
27.78%
0%
10.53%
*Figures above are a rough estimate for illustrative purposes and should not be used as an indicator for cover.
How can I get cheap income protection that still provides enough cover?
Here are a few ways you can save money and reduce the cost of your income protection.
You can choose a longer waiting period such as 60 or 90 days before your benefit will start to be paid
You can opt for a shorter benefit period (the length of time your claim will be paid out for)
You can choose to be paid only up until age 60 instead of 65
Pre-pay your benefits up to 12 months to receive tax deduction for the current financial year, while receiving the benefit for the next financial year
Frequently asked questions
Whether it's worth it or not depends on your individual circumstances and preferences. For many people, income protection insurance can offer a great deal of peace of mind that they'll be taken care of financially if they suddenly couldn't work due to illness or injury.
Again, it depends. Keep in mind that a policy usually only covers up to 70% of your pre-disability income. Some insurers may go as high as 85%.
Income protection insurance can be costly for a number of reasons. One being that the insurer may have to pay out until the insured reaches the age of 65. Paying 70% of an insured person's wage can really add up over the years. Unfortunately, the risk this poses from an insurer's point of view is passed on in the form of higher premiums.
Gary Ross Hunter was an editor at Finder, specialising in insurance. He’s been writing about life, travel, home, car, pet and health insurance for over 6 years and regularly appears as an insurance expert in publications including The Sydney Morning Herald, The Guardian and news.com.au. Gary holds a Kaplan Tier 2 General Advice General Insurance certification which meets the requirements of ASIC Regulatory Guide 146 (RG146). See full bio
Gary Ross's expertise
Gary Ross has written 649 Finder guides across topics including:
James Martin was the insurance editor at Finder. He has written on a range of insurance and finance topics for over 7 years. James often shares his insurance expertise as a media spokesperson and has appeared on Prime 7 News, WIN News, Insurance News, 7NEWS and The Guardian. He holds a Tier 1 General Insurance (General Advice) certification and a Tier 1 Generic Knowledge certification, both of which meet the requirements of ASIC Regulatory Guide 146 (RG146). See full bio
James's expertise
James has written 213 Finder guides across topics including:
One of the benefits of income protection insurance is that you may have the ability to claim a tax deduction on your premium benefits. Find out if the same rules apply for policies inside super.
Find out how much your income protection insurance policy will pay out in the event of a claim. Receive quotes for income protection and apply securely.
Find out what an income protection waiting period actually is and how the longer you wait can impact your premiums and benefit payments.
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