Integrity exits new retail advised life
Reflecting just how tough the life insurance sector has become, Integrity Life has declared it will no longer be writing new retail advised and group life insurance policies.
It attributed the move to the decline in adviser numbers and the consequent loss of scale.
In an announcement released first on social media, the company emphasised that it would be continuing “to operate and fully support our Policy Owners, Lives Insured’s and their loves who have an InForce Policy with us”.
“For these existing policyholders, nothing changes,” it said.
The announcement acknowledged that things had not worked out as the company had hoped and in specific reference to financial advisers said that the Australian life market and especially the financial advice profession had had numerous challenges over the last five years.
“We have taken this decision to be able to continue to protect and support your clients,” it said.
Frydenberg, ODwyer, LNP, ASIC, FSC & Life Insurance Co’s, this LIF has worked well hey.
Premiums will reduce they said = 100% increases in 4 years.
Life Advisers decimated.
Consumers decimated.
The only ones being held accountable are the FSC as it’s nearly dead as are a lot of the Life Ins Co’s.
But the Govt pollies and bureaucrats are never held to account for their disasters like LIF.
@Govt Disaster,
Sadly the premise for the destruction of the life insurance was initially caused by the life industry itself.
The other participants you mentioned were bit players that formed the catalyst of where the life insurance industry is today.
If you think about it, greedy life insurance companies had an opportunity not to accept “churned” business no matter what.
Accordingly a handful of advisors ( I think about 50) were guilty of “churning”but the life companies did not come out in defense of what was a small number of recalcitrants.
Instead once again through greed, they allowed the FSC to be their mouthpiece with the hope that they could do “Direct” business without engaging an independent advisory network.
Unfortunately that all came unstuck when it was found that many of the direct insurance policies weren’t worth the paper they were written on and the life companies were banned from promoting inferior life products to direct marketing.
As for Integrity Life… well they were the architects of their own demise.
At the outset I wrote to the MD of the company before they started and said if you are going to break into the life insurance market with a “me too” product, you are wasting your time.
He asked for a meeting with me and I explained to him, you need to decide which clients you want to attract and which ones you don’t.
You cannot be all things to all people, that market is already saturated with existing players.
In other words differentiate yourself from others with unique products.
I was one of 50 advisers engaged around Australia to put a number of risk proposal contracts together.
I suggested they bring out a high end IP product with reasonable benefits not provided by others in the market place.
That would dictate which client the product suited and you would not need to attract advisors because a decent product would bring them to you.
If the benefits were right then pricing would not be an issue for the right client or the right adviser.
Unfortunately during the policy design stage money was a problem and they went the other way and initially offered cheaper “no frills” products.
You can’t feel sorry for Integrity Life, they chose the wrong path.
20,000 odd votes that they did not care about. Advisor number being less now, do you really think they give a …….
The destruction of advised life insurance has been apparent to insiders for some time, but the huge price increases in recent years have masked it to those who rely on gross APRA figures.
Just as the collapse of Lehman brothers was the tipping point for the GFC, the exit of Integrity Life may well become the tipping point for the death spiral of life insurance in Australia.