Underinsurance is a significant problem in Australia, but we are not alone, according to a report issued by Swiss Re this week.
The report, entitled “European Insurance Report 2010, ‘Customers for life'”, was commissioned by Swiss Re’s Europe Division.
The findings indicate that while the European financial market may be older than the Australian one, both regions face a similar challenge when it comes to selling insurance.
Martin Albers, Head of Swiss Re’s Europe Division said: “There is a huge gap in protection. It varies by country but there are hundreds of thousands of under-insured people who need the financial protection provided by life insurance. Making even small inroads into this gap can translate into significant opportunities for this industry.
“We need to be bolder in selling the benefits of insurance
“We need to be bolder in selling the benefits of insurance – of how lives can be rebuilt after illness or injury, or of how families can be saved from financial hardship through the security of a life policy,” said Mr Albers.
The report also includes the results of a survey commissioned by Swiss Re among more than 11,000 consumers. According to the survey most consumers in Continental Europe see the need for some form of financial protection in the event of illness or untimely death. However, only 11% of respondents across Europe believe they are “well positioned financially” if they die, or suffer a long-term illness or disability.
The report also found that:
- Nearly half of the survey respondents say price is an issue which deters them from purchasing insurance
- 26% of consumers expect to rely heavily on government benefits in the event of financial misfortune due to death or illness
- European consumers have a clear need for life insurance, but many are unaware of how it can help deal with the financial impact of death, illness or disability
- Insurers need to engage better with consumers and build trust in the industry
The findings were presented to Swiss Re’s clients at a major conference hosted in Munich and attended by senior representatives of Europe’s leading life companies.
