The Australian life insurance sector is showing early signs of recovery, albeit from a much-reduced base, states the authors of Adviser Ratings’ 2025 Australian Financial Advice Landscape report.
Among the key findings in the life insurance section of the 188-page report are that new business volumes declined 44% between 2018 and 2024.
It states that in 2018 there were 103,000 new lives insured, but six years later the figure had dropped to 44,000 “…reflecting the significant impact of regulatory changes on market penetration”.
However, it points to signs of a recovery with an 11.4% increase in new business seen between 2023 and 2025.
“This positive trend suggests the industry is finally reaching a stabilisation point after years of disruption,” states the report.
The report also highlights a growing focus by consumers on their future financial security that’s creating a “…natural opportunity for advisers to incorporate appropriate risk protection strategies into their client conversations”.
“Looking forward, there is a conceivable path back to the $500m in new business volumes that were being written only six years ago, just before the Life Insurance Framework reforms were fully implemented and the risk adviser exodus began,” states the report.
Insurer satisfaction
Turning to the 2025 NPS rankings, Adviser Ratings states PPS Mutual has retained the top spot with a score of 54.8, thanks to the firm benefitting from “…taking a ‘slow’ approach to market, targeting a very particular type of policyholder and adviser”.
Meanwhile, NEOS (now positioning itself as an insurance technology platform), is placed second with 41.8.
“Of the majors, Zurich, has maintained a strong appeal and is now working successfully with a dual-branded approach.”
The report states that insurers such as NEOS, Zurich, MetLife, and PPS Mutual have distinguished themselves for service quality and adviser support thanks to responsive communication channels, and maintaining multiple touchpoints with minimal wait times.
When it comes to claim handling efficiency, it names NEOS, PPS Mutual and MetLife as leading this category by “offering transparent processes with clear timeframes and regular updates”.
As for underwriting, it names the top three insurers as NEOS, Metlife, and Zurich, thanks to their “…streamlined application processes incorporating digital-first platforms and reduced questionnaire lengths”.
Future business
The report also states the total insurable market for Australians aged 18-55 represents approximately $40.5bn in potential premiums across 13.7 million lives.
…the Quality of Advice Review provides an opportunity to reevaluate advice channels…
As for the General Advice framework, the report states it’s another significant pathway for expanding risk advice while creating new revenue streams.
“Over the past 20 years, the differentiation and understanding of what constitutes personal advice, general advice, and information have become more conservative,” state the report’s authors.
“This has led to more instances where clients seeking general advice end up receiving personal advice. The implementation of the Quality of Advice Review provides an opportunity to reevaluate advice channels with a clear understanding of the legal definitions of different types of advice.”
The report’s section on life insurance concludes stating that as insurers continue to enhance their underwriting processes advisers can focus more on the areas where they add value beyond product selection:
- Insurance needs analysis that contextualises protection within broader financial circumstances
- Claims advocacy when clients need to activate their coverage
- Regular coverage reviews that adapt to changing life circumstances
- Integration with estate planning and wealth transfer strategies
- Education around health and wellness benefits included in modern policies
