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Marcus English

Head of Risk & Insurance

Keeping Your Insurance Affordable as Life Changes

1 Oct 2025

Keeping Your Insurance Affordable as Life Changes

When it comes to personal risk insurance—think life insurance, total and permanent disability (TPD), trauma, and income protection— the reality is, we all hope it’s never needed. We are investing in peace of mind. In our family’s protected financial future. But that doesn’t mean you want to pay more than you have to.

With ongoing premium increases across the industry, many Australians are wondering:
How can I stay protected, without premiums spiralling out of control? And, as my financial position improves, do I still need as much cover as when I started out?

We are big of being proactive with the management of your insurance needs. Not just what and how much you need now, but identifying a pathway of how that gets adjusted over time. Let’s unpack some practical strategies to keep insurance affordable, and—just as importantly—how to evolve your cover as your life and wealth grow.

Review Your Coverage Regularly: Is It Still Fit for Purpose?
Insurance should never be “set and forget.” The amount you needed when you bought your first home or had young children might look very different five, ten, or twenty years later.
Key questions to ask:

  • Has your debt reduced, or are big loans now paid off?
  • Do your children still rely on you financially, or are they becoming independent?
  • Has your investment portfolio grown, or have savings increased?
  • What assets are disposable or how much passive income do your assets generate?

If you’ve built wealth and reduced debt, your ‘insurance gap’—what you’d need to protect your family—is smaller. In other words, you may be able to safely reduce cover and keep premiums down, without leaving you or your loved ones exposed.

If you already work with us, you would know that we look at these small changes every year to help manage your overall spend.

Adjust Your Cover to Reflect Your Changing Needs
As your financial resilience improves, the logic of “self-insuring” becomes real. For example:

  • Life and TPD insurance: Many people start with enough cover to clear the mortgage and provide for dependents. Over time, as savings and investments grow, you might only need enough cover for immediate expenses or to bridge income for a few years.
  • Income protection: Do you still need full cover, or would a lower benefit (or longer waiting period) suffice now that you have more emergency savings or reduced debt and therefore not need as high an income?
  • Trauma insurance: Is the level of cover aligned with anticipated costs (medical gaps, recovery, time off work), or is it now excessive relative to your financial position? To what extent could you rely on your own financial resources or invest towards medical recovery without jeopardising other financial goals?

A good adviser can run the numbers and create a pathway: start with more, and step it down sensibly as the ‘gap’ to your financial future narrows.

Tactics to Manage Premiums Over Time
If premium pressure is biting, you’ve got sensible options to consider:

  • Switch from level to stepped premiums: This can provide short-term savings, especially if you anticipate reducing or cancelling cover within 5–10 years. Level premiums are a challenging topic to navigate at the minute, and a real bugbear of mine. Once, a great long-term strategy. Now, the reality is that level premiums have become unsustainable for insurers, and we face ongoing premium rate increases. This is a topic to explore in itself, but in short, I simply don’t have faith in level premiums anymore, and if you started a policy within the last five years in particular, you could be better off switching back to an age based stepped premium.
  • Alter waiting periods or benefit periods: For income protection, a longer waiting period (if you have decent cash reserves) can trim costs. Different benefit periods may be appropriate to consider depending on your circumstances.
  • Review ownership structures: Structuring your policies to ensure the greatest level of tax efficiencies.
  • Partial reductions: Rather than dropping cover entirely, reduce by an amount that better fits your current needs and budget.

Importantly, any changes must be driven by strategy, not simply cost-cutting—there’s a balance to strike between affordability and essential protection. The above are general statements in nature and seeking appropriate advice is essential.

Plan for ‘Self-Insuring’ into the Future
The most satisfying insurance exit is the one you control. As you approach “self-insurance,” you’ll want a clear map:

  • When and how can you step down cover?
  • At what point does your financial position mean you could cope without insurance?
  • How will you review this annually?

Approach this transition with intention. Work with your adviser to set review points aligned with life changes—not just birthdays or policy anniversaries.

Psychology: Remember What Insurance Is (and Isn’t)
Insurance is there to catch you before you hit the ground. As your own “safety net” thickens—it’s rational for your need for insurance to decline.
But don’t jump without a net too soon; claims do happen, and the worst time to realise you’re under protected is when it’s too late. Make incremental adjustments, always with the bigger picture in mind.

Equally, have trust in the underlying strategy as your ability to self-insure improves. Some clients get nervous about reducing their insurance. That they might be tempting fate, or Murphy’s Law that something will happen to them once insurance has been reduced. But always remember that insurance is about a transfer of risk that you can’t cope with yourself. As that risk reduces, or no longer exists, trust in the ability to self-insure.

In Summary
Rising premiums are frustrating, but they’re also a catalyst to reassess and re-balance. The best results happen when insurance is dynamic—a plan that changes with you, not an expensive leftover from another phase of life.

If you haven’t reassessed your cover recently, now’s the time to ensure those precious dollars are truly serving you and your family’s goals.

Keen to review your insurance pathway? Get in touch—we’ll help you build a plan for today, and a roadmap for tomorrow.

This article is General Advice only and appropriate advice should be sought prior to making any changes to your own insurance arrangements.

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