The Three Numbers Every FIFO Worker Needs
A complete FIFO insurance plan typically covers three things: your life, your ability to work permanently (TPD), and your monthly income if you're temporarily off work (income protection). Each has a different calculation.
1. How Much Life Insurance Do You Need?
The goal of life insurance is to ensure your family can maintain their lifestyle and meet their financial obligations without your income. A simple starting framework:
- Outstanding debts — mortgage, car loans, personal loans
- Income replacement — your annual income multiplied by the number of years until your youngest child is financially independent
- Education fund — estimated cost of schooling for each child
- Final expenses — funeral costs, estate expenses (typically $20,000–$40,000)
- Less existing assets — super balance, savings, investments, existing cover
A FIFO worker with a $600k mortgage, two young kids, and a $150k income might need $2.5M–$3M in life cover when you add up debts, income replacement for 20 years, and education costs — less whatever they already have in super.
2. How Much TPD Cover Do You Need?
TPD is designed to cover a scenario where you survive but can never work again. The calculation is similar to life insurance but with some additional considerations:
- Add rehabilitation and ongoing medical costs (can be $100k–$500k depending on severity)
- Add home modification costs if required
- Factor in that you'll still be alive and spending — TPD needs to last your entire lifetime, not just support dependants
Many FIFO workers end up with TPD cover equal to or slightly higher than their life cover for this reason.
3. How Much Income Protection Do You Need?
This is the most straightforward calculation. IP typically covers up to 75% of your pre-disability income. The question is really about the benefit period and waiting period:
- Benefit period to age 65 is recommended for FIFO workers — if a serious injury stops you working at 40, you need 25 years of monthly payments, not 2
- Waiting period — if you have 3 months of sick leave and savings, choose a 90-day wait to reduce premiums. If you're living cheque to cheque, choose 30 days.
Does FIFO Work Change the Calculation?
Yes, in a few important ways:
- FIFO wages are often significantly higher than equivalent onshore roles — meaning the income replacement number is larger
- The physical nature of the work means the probability of an income-ending injury is higher than for office workers
- FIFO workers often have periods of high income followed by changes in roster or employment — locking in cover at your peak income makes sense
- Remote location means higher risk of medical evacuation costs and delayed treatment — a buffer in your TPD or IP amount is prudent
Use the Calculator
Rather than working through this manually, use our free FIFO insurance calculator. Enter your income, debts, and family situation and it'll give you a personalised estimate for life, TPD, and income protection in about 2 minutes.