Yet many Australians continue to pay for outdated insurance policies that no longer align with their needs. Worse still, some don’t fully understand what their policies would actually pay out, or how those costs may be quietly eroding their superannuation balance and limiting future compounding.
A smart insurance review in your 50s or early 60s could save thousands and help strengthen your long-term financial position.
Step One: Reassess What You Really Need
As your lifestyle and income change, the relevance of your existing insurance changes too. The policies that made sense when you had a large mortgage, dependent children, and high income may now offer little benefit.
This is the time to review key types of cover:
- Life insurance – If your family is financially secure or no longer dependent on your income, large life insurance policies may be unnecessary.
- Income protection – If you’re close to retirement or already financially independent, you may be paying premiums for income you no longer need to protect.
- Trauma or critical illness cover – These policies pay out in the event of a major health issue. But they need to be reviewed alongside your savings and the level of financial disruption a diagnosis would realistically cause.
- Total and Permanent Disability (TPD) – This is an area often misunderstood. A TPD “Any Occupation” policy may not pay out unless you are permanently unable to work in any job, not just your current one. If you’re slowing down or transitioning to lower-intensity work, this difference matters.
Step Two: Identify What You’re Still Insuring Against
It’s important to understand the actual risks your policies are offsetting. If you’re still paying for cover that no longer relates to a financial risk in your life—such as lost income, debt, or family dependency—it might be time to let it go.
In some cases, the need for insurance has passed, but the habit of paying premiums hasn’t. This is particularly common when:
- Children have left home.
- The mortgage has been cleared.
- A healthy superannuation or investment portfolio is in place.
Continuing to pay for cover in these scenarios drains cash flow and reduces retirement compounding, especially when insurance is funded from super.
Step Three: Be Cautious with Policies Held Inside Super
Holding insurance inside your super can seem efficient—it doesn’t affect your personal cash flow, and premiums are automatically deducted. But there’s a catch.
Every dollar used to pay premiums is a dollar not invested and growing for retirement. Over time, this can lead to a significantly lower super balance, especially when large premiums are withdrawn regularly for policies that may no longer be necessary.
In particular, income protection, life, and TPD cover inside super should be reviewed with an adviser to ensure the long-term cost to your retirement isn’t outweighing the benefit of the cover.
Step Four: Look for Optimisation Opportunities
Once you’ve identified unnecessary cover, the next step is making your insurance strategy more cost-effective.
Here are a few smart ways to reduce costs while maintaining appropriate protection:
- Consolidate and streamline policies to eliminate overlaps and gain potential multi-policy discounts.
- Increase deductibles or alter policy structures if you now have financial reserves to absorb smaller risks.
- Review your risk profile with your insurer—if you’ve moved into a lower-risk occupation or scaled back work hours, you may qualify for reduced premiums.
Final Steps to Optimising Your Insurance for Retirement
Insurance is designed to protect your financial position — but if it’s not reviewed regularly, it can become a silent drain on wealth. Many pre-retirees unknowingly pay thousands each year for policies that offer little meaningful benefit, reducing their ability to invest, save, and retire comfortably.
At Moiler Wealth, we specialise in helping professionals, business owners, and pre-retirees navigate this transition. We’ll help you evaluate what’s still essential, identify gaps, and ensure your insurance strategy aligns with your retirement goals.
Contact us today to review your insurance cover and build a smarter, leaner protection plan—one that works with your lifestyle, not against it.
Moiler Wealth – Helping You Live Life, Your Way.
Learn more about Moiler Wealth here.
Disclaimer: The advice provided here is general in nature only as, in preparing it we did not take account of your investment objectives, financial situation or particular needs. Before making an investment decision on the basis of this advice, you should consider how appropriate the advice is to your particular investment needs, and objectives. You should consider the relevant Product Disclosure Statement before making any decision relating to a financial product.
Ian Moiler Pty Ltd (Moiler Wealth) is an authorised representative of Count Financial Limited ABN 19 001 974 625 holder of Australian financial services licence number 227232 (“Count”). Count is owned by Count Limited ABN 111 26 990 832 of GPO Box 1453, Sydney NSW 2001. Count Limited is listed on the Australian Stock Exchange.
