The value of life insurance advisers
Written and accurate as at: Apr 23, 2019 Current Stats & Facts
New insurance claims data released by the Australian Prudential Regulation Authority (APRA) appears to have validated the role of life/risk advisers.
The data, released for the first time today, has found that, generally, clients are more likely to have success with an insurance claim if they have used an adviser.
It found that “advised business shows higher admittance rates than Individual non-advised for the same cover type”.
“This could be due to the policyholder having clearer expectations up front of what is covered by the product, or (related to the previous point) the adviser discouraging the policyholder from lodging a claim that is not covered by the policy,” the APRA analysis said.
“However, as noted above the number of observations is quite small (116 finalised claims, versus 3,260 for Non-Advised), plus the agencies were informed by the main writer of this product of some existing data limitations that have reduced the accuracy of their reported results.
The APRA analysis found that across all types of distribution channels, the admittance rate of claims was 92 per cent for client’s that took out insurance policies after following advice and recommendations from an adviser.
This is testament that obtaining quality advice provides a greater outcome for our client’s when it comes to claim time. Following the Royal Commission and the terrible outcomes that some policy holders received saw the demise of many businesses that started selling insurance via the direct insurance “Do it yourself” model.
