Integrity Life’s Chief Underwriter, Scott Hodgson – known to many advisers in the sector – considers the nature of underinsurance in Australia and shares his thoughts about life insurance advisers and the role they play in our community.
Looking back on his own family’s relationship with their ‘local AMP agent’ in the 1960s, Scott paints a picture of how risk advisers were regarded in decades past. He was motivated to share these reflections in response to the article from industry legend, Russell Collins, which we published a few weeks ago (click here)*…
I read Russell’s response to the Riskinfo poll, in respect to solutions to underinsurance, with a bit of a heavy heart to be honest – and not for his sentiments like “Selling life insurance is not a job – it’s a vocation!”
My mood was more influenced by the fact we have been having these discussions for a very long time. Our industry seems to be in a rut; unable to get past our trust gap, and not as effective as we would like to be in getting the positive stories (particularly around claims) out there.
…I could see the esteem in which my parents held her
I joined the life insurance industry because of my mum – she worked for the AMP in the 1960s, and we had our own AMP ‘rep’, whom I recall visiting our home and writing whole of life and endowment policies for us. Not that I knew at the time what the policies were – Nola was a lovely lady, engaging with my siblings and I, and I could see the esteem in which my parents held her. They told me that the policies were for the future, and they would keep us protected “…no matter what happened”. Even at that young age, I felt some comfort in knowing our future was being protected, even though the actual mechanics were pretty-opaque to a 5-year-old.
Well, we kids all made it through to adulthood, parents by our side, and the protection part of the policies was thankfully never needed. My Dad retired in his late 60’s, cashed in his by then ‘paid-up’ policies, and was very pleased.
Times have changed. The financial / economic landscape is different, so the policies have changed along with that. But no matter the contract variations, the fundamentals of life insurance protection have not changed.
The dreams and aspirations one has are usually tied in some way to financial goals. So, most of us need to earn income and grow assets – working hard to do that, while enjoying our lives along the way too.
Those dreams and aspirations can only come to fruition if everything goes ‘to plan’.
What if it doesn’t? Premature death or permanent (even temporary) disability is not part of the plan. So, our industry provides a solution – an alternative to the end of those dreams, and not just that – often helping to avoid plunging a family into financial distress (when they are already dealing with emotional stress).
So, from this underwriters’ point of view, there’s nothing more important than having the conversations Russell speaks of – those moments like my parents had many years ago, where a purchase was made based on trust, and peace of mind obtained.
We must find ways to facilitate the provision of advice and help advisers have those conversations…
We must find ways to facilitate the provision of advice and help advisers have those conversations and build the pool of life insurance premiums so we can help all those whose plans are derailed by death or disability.
Solving underinsurance, in this humble underwriter’s perspective, is a task in connecting people with the products in a way that helps them understand their value. Advisers have always been able to do this well, if given a chance.
*This is the second article we have published which responds to the sentiments shared by Russell Collins. Click here for the response we received from Sydney adviser, Guy Mankey.