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Insurance Market Update April 2021

With all the changes in the insurance and financial advice industry we thought it was important to keep you updated.

What is happening in the market

With all the changes in the insurance and financial advice industry we thought it was important to keep you updated.Life and income insurance in Australia is fundamentally changing!  Collectively the insurance industry lost $2.5 billion in the last two years largely due to unforeseen claims in income protection.  Claims for mental health are skyrocketing. Premium rates across the industry for income protection, trauma and TPD are on the rise. The regulator expressed concern some time ago about pricing and in 2020 stepped in to change what insures can offer.

What was the impact of this?

New income protection policies are not a patch on those available over the last 20 years and further change is coming.  
 
The last two years has seen the primary targets of the royal commission (THE BANKS) exit the financial planning and life insurance industry. 
 
I can understand why the consumer and the regulator had issue with them given often financial advice was nothing more than product advice and there were significant conflicts when you own the product, you are giving financial advice on! 
 
As a result of this, there has been significant consolidation with several insurers selling out

  • ANZ sold OnePath to Zurich, 
  • Suncorp sold Asteron to TAL, 
  • NAB sold MLC to IOOF
  • Macquarie sold their life insurance division to Zurich 
  • CommInsure was sold to AIA  

What does this mean for you?

If you currently hold policies, then potentially they are better than what will be available to you if you were to change.
 
 That said we need to manage your cover and costs now more than ever
 
 As a result, it pays to look at what cover you do need when renewals roll through, we can make sure we maintain good quality cover at the best price considering the right structure from a tax perspective
 
 As always, we are here to look after you and your insurance needs so call us on 03 9214-4100 if we can be of assistance.

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