We ended up getting life insurance for both of us. We both have life insurance through our super, around $300K each. We now have policies for $1M each on top of that through Virgin Life Ins. If either of us were to die, we want the other to be able to pay off all debts and stop work indefinitely to care for the kids. The cost of that cover, for both of us, is a total of $160 per month.

At this stage, we have not taken IP. The cost was prohibitive. We figured that if we required IP we would want it to cover DH until retirement age. The cost of covering 75% of his income to pay out until age 65 was over $400 per month. If he was unable to work for 2-3 years (premium was around $200 per month to cover 3 years) I work in a job where I could pick up full-time hours immediately and would earn an income comparable to his. The issue would be if I was required to care for him and so could not work myself. We would be reliant on family for help. If DH were to lose his job, we would receive a redundancy payout (independent fund) as well as access to 5 months of long service leave (again, an independent fund). In fact, DH was looking at redundancy about a month ago but he found another job immediately and we are reasonably confident that his contacts after 22 years in his industry are strong enough that his reputation will find him another job very promptly, well before he runs out of LSL. We are very fortunate to have the support of my dad, who is very wealthy and would support us financially until such time as we could get ourselves on our feet again. In discussing IP with my dad he advised that we would be better putting the money we would pay in IP into our mortgage at this stage and that's what we're doing.

For peace of mind, I would like to have IP for DH until retirement but it was just too expensive and at this time we decided to take the risk of not having it. I'd still like to hear what other have done and who they are insured with.