AFA News 6 November 2020. The Life Insurer CEO panel discussed some of the key issues impacting life insurance at the moment.
Front of mind was the APRA intervention on individual disability income insurance and what impact that would have on product design going forward. All four CEO’s, Damien Mu from AIA, Sean McCormack from MLC Life, Brett Clarke from TAL and Justin Delaney from Zurich/OnePath were clear that there are still many unknowns regarding future product design and pricing for income protection, in particular how the 5 year fixed term would work, but the overwhelming view was that we are at an inflection point where the product design and pricing of the future will not reflect the past. The current model is unsustainable which is why APRA intervened when it did.
Also discussed were the predictions for further rises in existing business premiums and the need for ASIC to provide more guidance to assist advisers in the future when the new products were delivered and existing clients were faced with the dilemma of comparing their existing policy with a new policy which is priced more sustainably.
The progress towards the 2021 LIF review was discussed and it was evident that as an industry, we are much more united in our approach to ensuring a good outcome and working towards retaining choice and accessibility in how customers pay for their life insurance advice. Retaining commission is an important factor in this and all four insurers made it quite clear of their overwhelming support for commissions.
The panel observed that while there has been substantial change in ownership over the last few years, the industry now seems to have found a landing spot where the ownership reflects parents who are committed to a long term business and a bright future in the Australian market.
Members wishing to watch the Life Insurer CEO Panel (and who have not previously registered for conference) can register for the on-demand conference content at a reduced rate by visiting the conference website here.
Issued 06.11.2020. AFA News