The Australian life insurance industry has a major opportunity for growth in addressing the problem of underinsurance, according to the AFA.
Speaking to ifa, the association's state director, Dave Slovinec, said that while many consumers have some default cover in their superannuation, they also need to understand what they have and how they are protected.
“The underinsurance issue in Australia is a massive problem,” Mr Slovinec said. “There’s a massive opportunity out there to get the word out about the importance of Australians getting insured.
“I think it’s making sure people understand what it is and what they’ve currently got,” he said.
Mr Slovinec noted that the problem is not about a lack of consumer desire for products; rather, it is about advisers educating consumers on insurance and showing them the benefits of having protection in place.
For its part, the association aims to educate consumers about the importance of getting advice through its 'Your Best Interests' program.
“It’s not the first thing that people think of. It’s not at the forefront of their thoughts, especially when you’re young and starting out,” he said.
“That’s part of the Your Best Interests piece that the AFA has put around consumer education around why it’s important to get advice and why you should speak to a financial adviser at any stage in life – from the beginning of your journey in employment right through to any life stage, from getting married and having children [to] then one day being able to retire and live comfortably,” Mr Slovinec said.
Adrian Flores is a deputy editor at Momentum Media, focusing mainly on banking, wealth management and financial services. He has also written for Public Accountant, Accountants Daily and The CEO Magazine.
You can contact him on [email protected].
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