The life insurance sector has been slow to respond to the release of the final report of the PJC Inquiry into Life Insurance, with only four insurers and one industry body making public statements on the report.
To date, only TAL, MLC, ANZ, ClearView and the Financial Services Council (FSC) have made comments on the report which was released last Tuesday, in a working week which was shortened due to Easter.
MLC Life Insurance stated that it “…particularly welcomes recommendations for the industry to transition to more open approved product lists (APL)” as well as the use of real-time disclosure that would allow consumers to track the progress of their claims.
The insurer also backed recommendations for the rationalisation of legacy products and allowing life insurers to become involved in funding rehabilitation services and processes earlier than currently allowed.
…MLC Life “…particularly welcomes recommendations for the industry to transition to more open approved product lists”
“MLC Life Insurance has long advocated for changing legislation that prevents life insurers from funding treatment to help support people return to health and their life, including their employment,” the insurer stated.
TAL stated it also supported, in principle, the call for the rationalisation of legacy products, the involvement of life insurers in rehabilitation, and broader APLs, as well as improved claims processes and the engagement of dedicated mental health expertise in the claims process.
We also continue to work closely with the FSC, regulators and various working committees to make meaningful progress on a number of areas referenced in the report, including mental health, medical information and the use of genetic testing,” TAL Group CEO & Managing Director, Brett Clark said.
ANZ, Group Executive – Wealth, Alexis George welcomed the release of the PJC Report and said a number of recommendations within it should be included in the next version of the Life Code set to be adopted by superannuation funds that offer life insurance.
“It would also be timely for the Australian Securities and Investments Commission to review and approve the Life Code given the positive consumer outcomes it could deliver,” George said.
“An open and transparent review process, followed by ASIC registration and enforcement will enhance the credibility of the Code and start to rebuild consumer trust and confidence in the life insurance industry,” she added.
Last week, ClearView released a brief statement on the PJC report using it to challenge the FSC’s Approved Product List (APL) standard – which calls for a minimum of three insurance providers – and instead called for the Council to adopt open APL’s among its members (see: FSC Welcomes PJC Report But ClearView Questions APL Standard).
In its response the FSC welcome calls for rationalisation of products and had already began to make changes in the areas of claims handling, medical definitions, mental health, and time-frames for dealing with customers and claims via its own Life Insurance Code of Practice.
What about the little bombshell with ASIC auditing 20% of risk advisers over next 3 years?
Anyone interested in that, AFA, FPA?? I am sick of this ongoing witch hunt, the riskie is being attacked daily and not a peep from insurers or AFA/FPA. Why?
Certainly a very stark contrast between the response of Australian insurer’s and their counterparts over the pond…
Insurance Co’s already can and do pay for rehabilitation with no demonstrable benefit in return to work or claims outcomes. The difference here is there are calls for insurer’s to pay for treatment (rather than rehabilitation) Insurer’s themselves say this is necessary comparing themselves to workers’ compensation insurers and their ability to manage and fund (or not fund) treatment of injured workers. The difference however is that workers’ compensation covers less income and shorter benefit period than life insurance where claimants are paid >75% replacement ratios to age 65 or 70 and there is no obligation whatsoever for claimants to engage in treatment, rehabilitation or return to work.
The ability for insurers to pay for treatment will have no positive impact on return to work or claims outcomes and lead only to further increases in costs and increases in premium for the majority of policyholders.
Why would the insurance industry volunteer to pay for treatment in a country where it is already covered by Medicare and health insurance is all but mandatory.
Fully agree ’emkay’. I keep paying my fees to the AFA and I mostly get emails about ‘young adviser of the year’ and elongated diatribe on education requirements/strategies when we don’t even know the full details and parameters as yet. Where’s the AFA screaming from the roof top now??? Talk about creating a monopoly [or duopoly with the FPA] and a classic ‘catch 22’. Can’t give full & proper risk insce. advice without being a paid up member of the TPB. Can’t become a TPB member unless am a member of the AFA [in my instance]. Ripoll says we’ve had a nice soft landing to date compared to what will follow irrespective of incumbent governments. A soft landing? More akin to hitting the ground after your parachute fails to open!!
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