How your life insurance application is assessed

A life insurance policy is one of the most important types of insurance you will ever apply for and outside of home insurance, it may be the largest insurance policy you have.


As a result, when you apply for a policy you will be required to go through a detailed application process.

Your Duty of Disclosure

When you are going through the application process, you have a legal duty to disclose any and all information which may be relevant to your application. Failure to comply with this duty of disclosure can result in your policy being cancelled or your level of cover being reduced.

What information do I need to disclose?

Normally, you will be required to disclose the following information:

  • Medical history
  • Financial history
  • Occupation
  • Sports and pastimes you participate in

The level of information you will be required to provide may depend on the type of cover you are applying for.

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Medical History

You are required to inform your insurer about your relevant medical history from the day you were born until your policy goes in force. This means that if you suffer from a relevant medical condition that only occurs after you have gone through the application process; you are required to notify your insurer.

Relevant medical history includes information which can affect the outcome of your policy. For e.g. telling your insurer you suffered from the flu may not be relevant whereas telling them you were born with a heart defect is relevant. When in doubt you should always disclose.

In some cases, if you are unable to remember exact details of your medical history, your insurer will request an authority to view form from you, giving them the authority to contact your doctors and view your medical files.

Some insurers may also require you to undergo a medical examination or blood test depending on your medical history. This will generally be paid for by your insurer.

It is important to note that medical examinations, blood tests and the viewing of medical records will not always be requested by the insurer.

Financial History

For lump sum benefits (life, trauma and TPD), you will be required to provided only limited financial information which includes your yearly income. If you are applying for a larger lump sum benefit (generally over $5 million) you may be required to justify why you need such a large amount of cover.

For income protection you will be required to provide proof of income at the time of your policy application.

In both cases, if you have suffered from bankruptcy or insolvency, this will need to be disclosed.


You will generally be required to disclose your occupation to your life insurer for life, trauma and TPD.

For income protection, you may be required to disclose further details about your occupation including qualifications, experience, the exact type of work you do etc.

No, generally you are not obligated to inform your insurer if you change occupations, even if your new occupation is riskier than your previous occupation. This is due to the fact that most life companies offer Guaranteed Renewable contracts.

Sports and Pastimes

Sports and Pastimes you participate in can have an affect on your premiums and it is important you disclose this to your insurer. While generally this may not impact on life insurance and trauma, it may impact on your Total and Permanent Disability and Income Protection insurance.

While generally mainstream sports such as football, cricket, basketball, tennis, swimming and golf will not affect your premiums, dangerous or extreme sports and pastimes such as sky diving, bungee jumping, motorsports, mountain climbing and scuba diving could have an impact.

We are experts at finding cover for people who participate in dangerous sports or pastimes. Speak to one of our advisers for more information.

Do I need to disclose any information to the insurer after policy has gone in force?

As long as you have complied with your duty of disclosure, you do not have to disclose any further information about your health, financials, occupation or pastimes once your policy has gone in force.

What decisions can be made by the insurer?

Once your insurer has all the required information, they will make their assessment based on the information provided. This is why it is crucial that all information is accurate and you are honest with your answers.

Life insurers can make the following decisions:

  • Insure you with standard rates
  • Insure you with a percentage loading
  • Insure you with a per mil loading (a dollar figure per $1,000 of cover)
  • Insure you but with exclusions (e.g. exclude cancer)
  • Decline to insure you

It’s important to know that if a decision has been made which is not satisfactory, it may be reviewable in 12 months time. If you are declined, you should speak to your adviser about your options.

When the decision is made, your insurer will inform you in writing of the outcome. If your application is accepted by the insurer, they will send you a Policy Schedule which outlines your cover including when the first premium is due.

You may also like to read:

How you can save on your premiums
Applying for a quote

Author: Russell Cain
Published: March 24, 2017

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