Life insurance: Advice offers stability
16 Sept 2015
Cansatr releases 2015 Life Insurance Star Ratings report today, collating 635,240 quotes and assessing features for 64 profiles to determine which providers offer outstanding value for money.
As a general rule, anything worth working for is worth protecting – and the Australian life insurance industry paid more than $7 billion in claims in 2014, according to the latest figures from the Australian Prudential Regulation Authority (APRA).
Every year, Canstar undertakes a mammoth research project to compare the products available to licensed financial advisers; this time around, we have researched products offered by 13 insurance giants across the spectrum of stand-alone term life insurance, trauma, TPD or disability insurance and income protection.
“A significant benefit of obtaining professional advice when organising your personal insurance is giving you certainty that the cover you have is going to match your financial commitments and needs,” said Canstar Wealth Manager, Paul O’Connor.
“Many workers have some level of insurance cover within their superannuation fund, often a default level of cover that simply isn’t sufficient. You can change jobs, change superannuation funds, but with advised life insurance, once the cover is in place it can’t be taken away.”
Mr O’Connor noted that advised premiums have not seen the significant increases in price that have been troubling the superannuation industry.
“Over the past eighteen months in particular we have seen some sharp price rises in cover provided by superannuation funds, particularly in relation to disability cover,” he said.
“There are a number of factors contributing to this; factors that haven’t affected the advised life industry. Essentially though it means that advised life insurance customers are benefitting from both certainty of cover and relative certainty of cost.”
So what does it cost?
While the cost of your insurance cover will depend on many lifestyle and medical factors, the average costs of cover for a white collar male, non-smoker, in good health are as follows:
TERM LIFE INSURANCE
|
20s |
30s |
40s |
50s |
|
| Sum Insured |
$500,000.00 |
$1,500,000.00 |
$1,500,000.00 |
$1,000,000.00 |
| Min |
$34.03 |
$69.40 |
$111.86 |
$253.21 |
| Avg |
$39.93 |
$73.10 |
$123.91 |
$275.76 |
| Max |
$45.40 |
$77.20 |
$134.92 |
$301.72 |
TPD – Total & Permanent Disablement
|
20s |
30s |
40s |
50s |
|
| Sum Insured |
$500,000.00 |
$1,500,000.00 |
$1,500,000.00 |
$1,000,000.00 |
| Min |
$22.04 |
$59.28 |
$122.63 |
$316.33 |
| Avg |
$28.35 |
$66.87 |
$138.11 |
$379.30 |
| Max |
$37.18 |
$81.39 |
$166.37 |
$426.48 |
TRAUMA
|
20s |
30s |
40s |
50s |
|
| Sum Insured |
$150,000.00 |
$250,000.00 |
$250,000.00 |
$150,000.00 |
| Min |
$23.41 |
$41.41 |
$94.85 |
$176.79 |
| Avg |
$28.82 |
$50.23 |
$118.09 |
$233.60 |
| Max |
$38.20 |
$64.85 |
$144.86 |
$299.21 |
INCOME PROTECTION
|
20s |
30s |
40s |
50s |
|
| Sum Insured |
$150,000.00 |
$250,000.00 |
$250,000.00 |
$150,000.00 |
| Min |
$33.71 |
$59.45 |
$146.18 |
$313.94 |
| Avg |
$42.61 |
$76.07 |
$183.94 |
$394.48 |
| Max |
$58.90 |
$100.79 |
$233.59 |
$515.19 |
Source: Canstar.com.au. Based on the policies selected from the 2015 Life Insurance Star Rating. The quotes based on the sum insured quoted by profiles for “White Collar-Male-Stepped Premium” Profiles
“It also worth remembering that small differences in policy wording or features, for example the difference between “any occupation” and “own occupation” when it comes to TPD cover, can mean the difference between receiving compensation or a claim being denied,” said Mr O’Connor. “It’s vital that consumers weigh up their individual needs, seek advice and choose a policy that strikes an ideal balance between features and price.”
Which providers offer Outstanding Value?
This year sees two national winners for the overall Canstar Outstanding Value – Life Insurance Australia award: TAL and Zurich.
“This is the eighth year we have conducted this research and the quality of the five star-rated products we see continues to increase,” Mr O’Connor said. “TAL and Zurich both deserve congratulations for their national achievement in a very competitive market. Both TAL and Zurich manage to strike a terrific balance between competitive price and superior features.”
In addition to the national award, Canstar also awards insurance providers for specific life insurance products and this year the Canstar analysis has provided the following product-specific winners:
National Product Category Awards
Outstanding Value Insurance – Term Life
AMP
TAL
Outstanding Value Insurance – Trauma
OnePath
TAL
Outstanding Value Insurance – TPD
Clearview
Zurich
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