Yes—Revenue NSW classifies disability income insurance as Type B general insurance and sets duty at 5 per cent of the premium (figures checked 1 October 2026). Under Revenue NSW’s insurance duty guidance, the premium is the total amount paid to an insurer to establish insurance; it may include a fire service levy, an emergency service levy and GST, but excludes intermediary fees and duty.
What does Type B mean for NSW insurance duty?
Revenue NSW describes general insurance as insurance relating to property in NSW, or to a risk, contingency or event concerning an act or omission that may occur within or partly within NSW. It divides general insurance into three types and expressly includes disability income insurance in Type B.
| Type | Insurance listed by Revenue NSW | Duty rate |
|---|---|---|
| B | Motor vehicle, aviation, disability income, occupational indemnity, and hospital and ancillary health benefits insurance | 5 per cent of the premium |
Revenue NSW separately defines life insurance and a life insurance rider. Its general insurance category does not include life insurance, a life insurance rider or insurance that is exempt from duty.
What amount is used as the premium?
Insurance duty is calculated on the premium paid to establish insurance. Revenue NSW includes the total amount paid to the insurer, but treats particular components differently.
| Component | Treatment in the premium |
|---|---|
| Total amount paid to the insurer | This is the premium |
| Fire service levy | May be included |
| Emergency service levy | May be included |
| GST | May be included |
| Fee paid to an intermediary | Excluded |
| Insurance duty | Excluded |
A premium is treated as paid when it is received by the insurer, broker or agent. Generally, the insurer must pay the insurance duty.
How does a policy with more than one type of cover get treated?
An insurance policy may contain life insurance, different types of general insurance and exempt insurance. Where that happens, Revenue NSW requires the following treatment:
- Apportion the premium between the different insurance types.
- Separate the premium relating to each type.
- Apply the correct duty rate to each separated premium amount.
The disability income component therefore remains within Type B and attracts 5 per cent of its apportioned premium, while any other type of cover must be assessed separately.
What should a cleaner check in the policy documents?
Check both the regulator’s current guidance and the policy’s Product Disclosure Statement, or PDS:
- Revenue NSW’s guidance explains the duty classification, rate and premium basis.
- The PDS sets out the insurance cover provided under the contract.
- For mixed cover, ask the insurer or intermediary to identify the separate premium amounts and the duty calculation applied to each.
This is general information, not financial or legal advice. Check the Revenue NSW page and your policy’s PDS before relying on a particular calculation.
Sources
FAQ
Is disability income insurance treated as life insurance for NSW duty?
No. Revenue NSW places disability income insurance within Type B general insurance. It separately defines life insurance and a life insurance rider.
Who normally pays the 5 per cent duty?
The insurer generally must pay the duty. A premium is treated as paid when received by the insurer, broker or agent. If it is paid to someone who is not a registered insurer, Revenue NSW treats it as if paid to a registered insurer; the duty remains payable and the insured person must pay it.
Is a broker or intermediary fee included in the premium?
No. The premium excludes a fee paid to an intermediary and any amount of duty. A fire service levy, emergency service levy and GST may be included.
What happens if the policy contains different types of insurance?
The premium must be apportioned, the amount relating to each insurance type must be separated, and the correct duty rate must be applied to each amount.
What happens if a premium is refunded?
The insurer can apply to Revenue NSW for a refund of the duty or an offset against future liabilities. If you are the insured person, contact the insurer about the duty refund.
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