Effective today, stepped premiums for life cover insurance, as well as TPD extension insurance, will be reduced by 15 per cent for new customers at or when they reach 45 years of age or over for policies inside and outside super.
The insurer will also be reducing stepped premium rates for life and TPD policies for new customers at or when they reach between 40-44 years.
MLC said these customers will receive a 2.5 per cent cumulative rate cut each year until they reach 45, when the 15 per cent saving will then apply.
Speaking to Risk Adviser about the initiative, MLC executive general manager of insurance David Hackett said the insurer is focused on making insurance more affordable for Australians.
“We are really focused on the fact that there is an underinsurance issue in Australia and [a lot] of families in Australia don’t have any insurance,” Mr Hackett said.
“For the 40 to 45-year-olds and above, stepped premiums often cause them to be underinsured right when they need the insurance the most, so we are just trying to lend a bit of a hand there.”
“At this stage, this is just for stepped premiums because they are the ones that place the increasing burden on policy holders as they get older,” he said.
Over the past 12 months, MLC has introduced a number of initiatives, including the removal of insurance policy fees, increasing its multi-cover discount to 30 per cent, extending its TPD optimiser, and introducing insurance premium payments by partial rollovers.
Recently NAB sold the insurance arm of MLC to Japanese insurer Nippon Life.
Commenting on the sale of the business at the time, NAB general manager of wealth advice Greg Miller told Risk Adviser that there will be no changes to the business’ insurance products, and they will continue.
