In any field of study, the basic meaning of insurance is risk management policy that is taken by the people in order to reduce the uncertainties at the time of the real risk. The parties involved in insurance are the insurer (generally a company) and the insured (an individual)

The Australian market related to the insurance sector is sophisticated and strong. Insurance in the country can be divided into three categories namely general insurance, health insurance and life insurance.  Talking about life insurance in Australia, the main categories that are sold the most are disability income insurance and term life insurance.


The term life insurance provides the insured person’s family with the lump sum amount that the person was insured for, at the time of death of the insured. It is a cheap way of insurance when compared to the amount given for potential payment and is required by all those people who have a family after them. Many policies under this category of insurance also provides the insured with the lump sum amount even if the person is suffering from an illness, provided that the illness is such that the insured person’s remaining life is not more than a year.
The insurance cover is quiet easy to be understood. The amount will be paid at the time of death of the insured. However, there is an exception to the cover; death due to suicide in 13 months of taking the policy is not covered. If the policy is a non- super annuation personal policy, then the policy payment is free of tax. Is should be noted that the policy does not have a cash value.


The common name for disability insurance is disability income insurance or DI in short. It is a kind of a life insurance that makes sure to protect the income of the insured person against a risk that any kind of disability in the insured person will make his working and thereby earning impossible. This type of life insurance covers sick leaves that are paid, short term as well as the long term benefits from the disability.


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