Australians unsure about group insurance

12-Dec-2017

By Sarah Kendell

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The majority of Australians were unsure of the extent of insurance coverage they had inside superannuation, meaning life insurers must do more to help consumers understand and adjust their group insurance coverage if needed, according to MetLife.

New research from the insurer revealed that based on a survey of 1500 working Australians between the ages of 18 and 64, 72 per cent had limited knowledge of what they were covered for in case of an accident or illness, while 66 per cent did not know how to calculate the appropriate amount of insurance cover for them.

Addressing a media briefing on the research in Sydney yesterday, MetLife Australia chief executive Deanne Stewart said the results indicated that while most consumers had a basic knowledge of life insurance inside super, there was more work to be done to ensure members had an efficient level of cover.

“We have a lot more to do as an industry on simplifying communication [with members] but still getting the facts across,” Stewart said.

“On the super side there is a lot done around the key things you need to do to get your super working effectively, but you never see that equivalent on the insurance side.”

Despite the fact insurance was commonly viewed as a grudge purchase, the research revealed that with some encouragement, consumers were willing to engage with their insurance and take action to set up an effective level of cover.

Almost one-third of consumers indicated they had started to engage with their life insurance after seeing a financial planner, while 20 per cent said they had reviewed their cover after being prompted to do so by their super fund.

Stewart said based on those statistics, the insurer was taking further action with its super fund partners to build in prompts for members at key trigger points over their working lives, including when they got married, started a family or began a new job.

“There are critical moments where people will take action, so we are working with super funds to do more in those critical moments, whether that be the fact they are calling in saying they want to change their beneficiary or their surname,” she said.

“That is often a clear moment for super funds to reach out and check that they have the right level of insurance, but you will find that the majority of super funds don’t do that proactively, so that is something that we want to work on.”

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