Wading through how to determine the best IP product solution for clients since APRA’s IP intervention garnered the most interest from advisers this week – although we take the point that perhaps a better poll question may have been that if all the new IP products were the same, which of the other factors would be most influential in your decision to recommend…

Which is usually the most critical factor for you when it comes to selecting the best income protection insurance product solution for your client:
  • Product features/definitions (61%)
  • Premium stability (19%)
  • Competitive premiums (13%)
  • Claims acceptance rate (5%)
  • Not sure (1%)
  • Other factors (1%)

As 2022 awakens, we’re interested to hear from you about how you’re settling in with the new era of income protection insurance products launched into the market last October, following APRA’s IP intervention (see: APRA’s IP Intervention – New Product Releases).

Specifically, we’re keen to know what’s most important for you when it comes to establishing which of the new era IP product offers will deliver the best solution for your clients.

We appreciate the best solution will be determined by each client’s individual circumstances and that this solution will vary accordingly. But while acknowledging the best solution will vary across clients, are you finding that there’s one factor above all others that your turning to first – a box that must usually be ticked at the start before you look at other factors?

This question was asked in a slightly different way in Investment Trend’s 2021 Adviser Risk Report, in which key definitions (such as Total Disability, Partial Disability and Pre-Disability Income) took precedence for risk advisers over other factors such as competitive premiums, guaranteed terms and replacement ratios. Does this reflect your own experience so far?

As usual, there’s more we could say, but it’s time to hand the conversation to you, as we welcome your take on what is still early days for the new era of IP products in the Australian market. Tell us what you think and we’ll report back next week…

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2 COMMENTS

  1. This is the kind of question like “If you have to choose between wearing trousers and a shirt, which is most important for you?”

    Well, it would be trousers 🙂 but the answer does not reflect reality. I consider features, premiums and claims experiences as premium stability has not been predictable in the past.

  2. I suggest the more important aspect right now is the impact of the Hayne driven changes to the disclosure rules. Insurers consider the Hayne changes are a detriment, and clearly they no longer have the bottom-line security of being able to allege nondisclosure. The new rules around misrepresentation effectively mean that insurers are going to double check everything, to be sure, to be sure. No longer is the game about getting the business on the books at the right price. It now appears to be making absolute certain that there is no possibility of there ever being a claim. That is a self defeating philosophy. Everyone’s insurable, it just has to be price right! And everyone one ultimately will claim if they can afford to keep the policy going

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