Can You Have Multiple Life Insurance Policies in Australia?

Life Insurance by Life Stage

The choices you make today can impact your long-term health, wealth and happiness. Understand the important role Life Insurance can play in key life events.

Life Insurance Guides

In Australia, it’s legal for people to hold more than one life insurance policy.

However, there are some important things to understand before you decide to take out multiple life insurance policies. Here, we’ll walk you through what you need to know about taking out multiple policies and how it could affect your premiums and future claims.

Is it legal to have more than one life insurance policy in Australia?

Yes. There is no specific legal limit on how many life insurance policies you can have in Australia. You can:

Hold more than one life insurance policy at the same time
Hold policies with different insurers
Hold multiple policies with the same insurer (subject to their underwriting rules)
Have cover both inside superannuation and outside superannuation

“Each insurer will assess your application based not only on your health, age, occupation, and the total amount of cover you’re applying for (including any existing cover), but also on your financial circumstances, residential status and any pastimes or activities that may influence your risk profile.”

Joanne Sinclair, NobleOak Senior Underwriter

Why do people take out multiple life insurance policies?

People choose to hold more than one policy for a range of practical reasons:

Different life stages and goals: As your life changes, extra policies can be used to “top up” cover. You might take one policy to cover a large mortgage and then take out another policy at a later stage to help provide for your children’s education or ongoing living costs. However, in many cases, it might be easier just to top up your existing policy rather than taking out a separate policy.
Cover through super plus separate personal cover: Many Australians have default life cover through superannuation, and some people add separate policies to increase their total cover amount in order to meet their family’s needs.
Separating personal and business needs: Business owners might take out one policy to help protect their family’s financial security and a separate policy linked to their business risks.
Tailored features, riders and products: You might find one insurer whose policy suits your needs for core life insurance and another whose policy offers optional benefits or riders that are attractive for specific risks. Or you might want to take out products other than life cover such as income protection, trauma or total & permanent disability insurance (TPD).

The pros and cons

This table compares the benefits and disadvantages of having multiple life insurance policies:

Pros	Cons
Ability to tailor cover for different goals (e.g. mortgage vs family support).	More administration, with multiple premiums, documents, and renewal notices to track, and the potential to miss out on discounts (such as large sum insured, multi-cover or multi-policy discounts) that may be available when cover is consolidated.
Flexibility to add or reduce cover over time by adjusting individual policies rather than one large policy.	Risk of overinsurance, where your total cover exceeds what insurers consider reasonable for your income and needs.
Option to keep an older, competitively priced policy while adding new cover with updated features.	Potential for inconsistent terms, which can be confusing at claim time.
Ability to diversify across insurers, which some people like from a risk and product perspective.	You may face multiple underwriting assessments, which can be time-consuming.
Having cover both inside and outside super may provide additional flexibility around how premiums are paid and how benefits are used.	Total cost can be higher overall, especially if you don’t regularly review your cover against your current needs.

What to know before taking out an additional policy

Before you decide to add another life insurance policy, it’s important to think through a few key points:

Check your total benefit against insurer limits: Insurers consider whether your combined life cover is reasonable for your income, debts, and dependants. If your total requested benefit is too high, they may reduce or decline part of it.
Understand underwriting requirements: Each new policy may require medical questions, tests, or reports. Be prepared for a fresh assessment, even if you’ve been insured before.
Review your budget: Multiple policies mean multiple premiums. Make sure the total cost is sustainable over time, especially if you’ve chosen stepped premiums that can increase as you age.
Compare policy terms and definitions: Every insurance product is different. Before choosing a policy, look at differences in waiting periods, exclusions, and how key terms are defined. Check your current policy’s product disclosure statement (PDS). You may already have the option to increase your cover when certain life events take place – sometimes without having to go through underwriting. NobleOak’s policies offer this feature.

Can you claim on multiple life insurance policies?

In many cases, you can claim on more than one life insurance policy, provided:

Each policy is in force at the time of the insured event
You meet the terms and conditions for each policy
You have correctly disclosed your circumstances, including other policies, when you applied

If you’re unsure how your policies might interact at claim time, speaking with your insurer or a financial adviser can be helpful.

Does having multiple policies affect premiums?

Holding more than one policy won’t usually change the premium on each individual policy, but it will affect:

Your total cost: You’ll be paying more in premiums overall, because you’re paying for multiple blocks of cover.
How insurers assess new applications: When you apply for additional cover, insurers consider the total sum insured across all policies.
Discount opportunities: Some insurers may offer large sum insured insurance, multi-cover or multi-policy discounts when you bundle products. On the other hand, splitting your cover across different insurers may mean you miss out on these opportunities.

“Ultimately, the question isn’t just “can you have multiple life insurance policies”, but whether the combined premiums, structures, and features make sense for your financial situation.”

Miguel Cortes, Senior Manager, Direct Product & Propositions, NobleOak

Alternative policy options

If you’re considering adding another policy, it’s worth exploring whether other options might work just as well (or better) for your needs:

Increase the sum insured on your existing policy: Sometimes, simply increasing the benefit amount on your current policy can be more straightforward than taking out a completely new policy.
Review your cover regularly: Rather than stacking policies, you may be able to adjust your current policy to reflect your current circumstances and insurance needs.
Bundle cover with one insurer: Holding life insurance and other cover (such as TPD or income protection) with the same insurer may, in some cases, help you qualify for multi-cover discounts.
Reassess health insurance separately: Health insurance is subject to different rules and considerations. If you’re thinking about multiple health or life policies, it’s a good idea to get advice tailored to your circumstances.

Award-winning life insurance

NobleOak provides award-winning life insurance designed to offer quality cover and clear, straightforward terms. If you’re exploring your options and want to understand how much life insurance cover you might need, NobleOak offers tools and resources to help you get started. Try our insurance calculator to estimate an appropriate level of cover for your situation or get a personal life insurance quote in just a few steps.

As with any financial decision, it’s important to read the relevant Product Disclosure Statement (PDS), consider whether the product is right for you, and seek professional advice if you need help deciding on the right approach.Any financial product advice is general in nature only and does not take into account your individual circumstances, objectives, financial situation, or needs. Before acting on it, please consider the appropriateness of the information, having regard to those factors. Any third party websites or tools referred to are subject to their own terms and conditions and NobleOak Life Limited makes no representation or warranty as to any information on those websites. Persons deciding whether to acquire or continue to hold life insurance issued by NobleOak Life Limited should consider the relevant Product Disclosure Statement and Target Market Determination for the product. NobleOak Life Limited ABN 85 087 648 708 AFSL 247302.