Life insurance coverage on the rise despite sticky knowledge gap

New research from Australian life insurer, NobleOak, has confirmed while the number of Australians holding some form of life insurance coverage has risen, a persistent knowledge and confidence gap remains.

The NobleOak Life Insurance Pulse Report, derived from a survey of 1,000 Australians aged between 30 and 60 years old conducted earlier this year, indicated that 60 per cent of Australians now have life insurance coverage – compared to 55 per cent last year.

However, only 30 per cent of those surveyed felt confident in their knowledge and understanding of “fully underwritten” policies; 50 per cent of these respondents said they currently have a life insurance policy.

“The NobleOak Pulse Report provides a valuable annual pulse check on Australian attitudes toward financial security and wellbeing,” NobleOak Director & Chief Executive Officer, Anthony Brown, said.

“This year’s report found life insurance has now become a priority purchase for many Australians, outranking education, mobile phone use, some grocery purchases, and gym memberships and holidays. This shift reflects the growing trend for Australians to invest in the future of their loved ones to feel financially secure.

“It is worrying however to discover that the general understanding of the benefit of a fully underwritten life insurance policy is low, given we believe that fully underwritten cover provides customers with more peace of mind, particularly at time of claim. That’s why we only provide fully underwritten cover at NobleOak.”

The report also suggested that Australians are being just as pro-active as they were prior to COVID-19 in engaging with financial advisers or brokers to help understand and secure their financial future (32 per cent).

Women also reported lower levels of financial confidence than men (28 per cent compared to 20 per cent), echoing similar reports calling for industry professionals to address this gender confidence gap.

According to the report, the lack in life insurance knowledge hasn’t seemed to affect financial security, with 76 per cent of those surveyed feeling in control of their personal finances and their financial bandwidth to cover an unexpected expense.

“The research reveals an opportunity to educate Australians on the value of fully underwritten life insurance for a more confident claims experience,” Brown said.