Powered by MOMENTUM MEDIA
lawyers weekly logo
Powered by MOMENTUM MEDIA
  • subs-bellGet the latest news! Subscribe to the ifa bulletin
Advertisement

Connect and engage

Everyone has an opinion, and some people feel compelled to speak out. Share your views, opinions and insights with financial advisers accross Australia today. If you'd like to write a blog or to submit a letter to the editor please contact the editorial team on [email protected] or call 02 9922 3300.

Latest Comments

I seem to recall Don Trapnell discovered ALL life insurance is LEVEL Premium in the UK

One question for which I do not have an answer: is CPI applied to the sum insured each yearIn the UK.

That was always my question about a claim that a product had level premium. A genuine true level premium product froze all ongoing CPI increases at the Premium that applied at the age at entrance.

It is been my practice for over three decades to make sure my clients purchasing level premium products understood that if the rates of stepped premium policies were increased because of claims experience, that a relevant and related increase would occur with level premiums. But with a genuine true level contract there were always demonstrable savings over the accumulated stepped premiums if the policy was retained for 20 or 25 years. If of course you believe the projections.

Of course we all know what happened. Comminsure apparently, according to insiders, refused to increase premiums for level premiums following an increase to the premiums of their stepped premium policies, because apparently the CBA bank advisers had been primarily writing level premium contracts, and the bank feared that an announced increase could result in lapses. Just saying!

Then of course there were the former National Mutual level premium contracts, absorbed into AMP I believe around 2009. The AMP board apparently refused to accept advice that those Level premiums needed to be adjusted, which resulted ultimately in a nice friendly letter from AMP a few years back to its level premium policy holders that their premiums had jumped by 50% in one year.

The facts are that our friends the life insurers have failed us on their level premium promise and there is now a significant distrust from most experienced risk advisers on the continuing attraction of writing new business on level premium.

Regulators signal more work ahead on sustainable life insurance premiums

2 days ago.
|
Risk