Life insurers see advisers as key in tough times

In the face of research revealing that four in 10 life insurance customers will either cancel or modify their life insurance cover amid the cost of living crisis, Acenda chief executive, Kent Griffin, has highlighted the importance of financial advisers.

Delivering a keynote address to the Council of Australian Life Insurers Conference in Sydney, Griffin said advisers are uniquely placed to support clients in navigating insurance options that align with their situation.

At the same time, Griffin also traversed the issue of advice being delivered by life insurers.

In doing so, he urged continuity between the Government’s approach to the Delivering Better Financial Outcomes (DBFO) legislation and that of the Opposition.

“We know there is a large, unmet need for advice and guidance on life insurance. CALI’s latest sentiment tracker shows 33% of working Australians sought or considered financial advice in the past three months. But only 7% actually received it,” he said.

“There is universal agreement across the industry and government about the importance of improving access to quality, affordable advice.”

“Pleasingly, advice reform is imminent – we welcome the release of draft legislation on tranche 2 of DBFO reforms – and urge whoever forms government after the election to ensure advice reform remains a priority,” Griffin said.

“And after a tough few years we are seeing the advice market start to stabilise. Six hundred and fifty new financial advisers joined the advice industry last year. The number of advisers writing life insurance also continues to increase,” he said.

“One in two people who received advice about life insurance in the past three months got it from a financial adviser.”

Griffin said the life insurance industry had to continue to embrace a comprehensive reform agenda.

“The latest tranche of the Government’s financial advice reforms, released in March, will help to simplify the advice framework, ensuring more Australians can access advice in a format that is easy to understand and tailored to their individual needs.”

“This is a positive step however more can be done. The Government has also committed to developing the remaining pieces to modernise the best interest duty and create a new class of adviser, and that these combined with the draft legislation released will be introduced into Parliament as a single package. With this commitment from Government we are making progress.”