August 30, 2019
Life insurer MetLife has called for superannuation funds and life insurers to work together to increase Australians’ awareness of the insurance cover they have through their superannuation fund.
The call follows the release of the annual MetLife Insurance Inside Super Report, which explores the awareness, attitudes and engagement of Australians with insurance inside their superannuation.
MetLife stated there has been little change in the number of Australians that are aware they have access to Life, Total & Permanent Disability (TPD) and Income Protection (IP) cover through their super.
This year’s research in particular, sought to better understand how fund members engage with their super and what drives them to modify their insurance cover.
Findings from the research revealed super funds have a critical role to play in driving awareness of insurance inside super options and empowering members to make decisions about their cover with confidence.
Key findings from the research included:
- Nearly 40% of super fund members who were aware they had insurance inside super were not aware they could modify the level cover
- Almost three quarters (72%) of respondents trust their super fund to help them make informed decisions about life insurance while 70% trust their super fund to help them understand how much life insurance they need
- Over half of those who increased their insurance inside super were prompted by a life event, with 22% modifying after buying a house, 20% following a recommendation from a financial adviser and 19% following communication from a superannuation fund
- % of members reported having concerns about their insurer paying out in the event of a claim due to distrust and industry reputation, with 42% of members specifically citing reasons of distrust
The research found one of the biggest barriers preventing engagement is concern about their insurance paying out at claim time, with the majority citing distrust and industry reputation as a significant deterrent.
As a result, MetLife has called for increased transparency and collaboration across the industry, to get more Australians engaging with, and modifying, their insurance.
To facilitate this, MetLife has today launched ‘Inside Update’, which provides super fund partners and their members with a suite of best-practice tools and information designed to empower Australians to make informed decisions about their cover.
MetLife Australia Chief Customer and Marketing Officer, Chesne Stafford, said: “Misinformation around insurance inside super and the value it provides has been widespread in recent months, particularly as the Protect Your Super Changes come into force.
“With thousands of Australians with inactive and low balance accounts now having their insurance switched off and the potential for more people to be affected, it is more important than ever to increase awareness and get people checking what level of protection they have and need. Whilst some of the opt-in rates are encouraging there is still significant work to do,’ explained Stafford.
“We know insurance inside super is built-in protection that serves an incredibly important purpose and has been a safety net for many Australians when the unexpected occurs. Everyday we see examples of people who rely on their insurance inside super to help pick up the pieces after major illness or accident, or bereavement.
Stafford added that the industry needs to ensure that protection continues and people aren’t caught unexpectedly without cover.
The 2019 MetLife Insurance Inside Super Report surveyed 1,506 working Australians.
Click here to view the report.