Our report on the industry’s response to Zurich’s decision to significantly raise premiums on life insurance policies involving third-party funding generated plenty of reader interest this week…
Zurich’s decision to create a new death cover class and significantly raise premiums on life insurance policies involving third-party funding arrangements has generated strong debate across the adviser community (see: Zurich Creates New Death Cover Class).
Among the many responses shared directly with Riskinfo or posted across social media platforms, one adviser has questioned the underlying logic of the insurer’s decision, arguing there’s no clear link between partial policy ownership and mortality risk.
…the focus appears to be on premium growth rather than policyholder outcomes
Meanwhile, another reader has raised concerns about the broader context, pointing to reports of strong profitability from Zurich’s Australian operations. He questioned how such results align with what he sees as a lack of customer value, arguing the focus appears to be on premium growth rather than policyholder outcomes.
The adviser also detailed the direct impact on clients, saying he had been advised a policyholder’s premiums would rise by 400% (payable by the third party).
…pricing risk premiums could not have foreseen the effect from such policy co-ownership models
While the majority of commentary to date has questioned Zurich’s move, one comment supporting the initiative argues third party or policy co-ownership models extend policy lifecycles beyond the norm and questions the effect this would have on claims and premiums for the wider insurance pool. The adviser said pricing risk premiums could not have foreseen the effect from such policy co-ownership models.
He therefore supported the insurer for effectively isolating these premium movements only to those policies adopting the co-ownership model criteria as outlined by Zurich, rather than exposing the broader book of policies to further potential premium increases.
Riskinfo has contacted consumer groups, regulators, other insurers and interested stakeholders for comment and will report further responses and developments as they come to hand.
Gotta laugh.
Zurich's Global CEO, Mario Greco, was quoted in RiskInfo on 30 October 2025 as saying Zurich were about to, “redefine what customers can expect from their insurer”.
Ain't that the truth!!
It seems those customers can now expect Zurich to exercise previously unknown rights to increase premiums on individual policies that look like leading to claim rather than be cancelled due to a lack of affordability.
And my expectation is that if they get away with adding a 400% loading onto these vulnerable client's existing policies (some of which have been in force for 20+ years) by inventing a new client 'grouping' based on the fact they don't like the policy's new owners (all of which were changed via Zurich / OnePath's own Memorandum of Transfer system with ASIC approval), we can expect that in the future, anything goes…
And while I'm sure Zurich's PR team will declare they won't ever reprice policies on the lives of other customers who have been unlucky enough to have made a claim or haven't been underwritten for 10+ years, (or under whatever other creative ideas they can come up with) to reduce claim numbers, I'm pretty sure that even 6 months ago they'd have said exactly the same thing about the possibility of repricing these customers.
To revisit Mr Greco's quote, what can't be expected is that the current Zurich decision makers can ever again be trusted to put their customer's interests ahead of their own.
And while, as an Adviser, it's obvious that any current or proposed Zurich / OnePath / Clearview new business will either have to be rerouted to another insurer or at least have compliance documentation reissued with enormous disclaimers that so called 'guaranteed renewable' policies may be regrouped or repriced at any time in the future at the insurer's discretion, I also have concerns about potential liability attached to in force business I have with those insurers.
As someone said to me the other day, "the only thing insurance companies have to sell is a promise they will do the right thing by their customers". They summed up with, "Zurich have broke the promise".
Zurich are breaking promises and breaching their duty of good faith without compunction.
What is motivating this mean behaviour?
Agreed! Just like Clearview with their IP Extras policies a few years back where they JACKED UP Level to 65 premium rates by 38% for core component plus extra for optional extras which for some meant a 62% increase! And that was after ALREADY PAYING WELL OVER a Stepped premium rate.
They obliterated my faith in insurers being honest with their premium rates from that moment….bar a few.
Penny drop! i-Extend policy extension ownership….now I get it!
You can't offer a product Zurich with long expiry dates that your originally thought looked great on paper but secretly knew wouldn't be extended past 65-70 and then suddenly change the goal posts because they are now! That's just heinously cunning in my opinion. BE BETTER at running your business instead of just transferring your inflated (and often unnecessary) costs to other people.
Call to arms!
To follow on from my last comment about poor Zurich’s RECORD BUISNESS PROFITS IN 2025, it is time to stick up for our clients. What we have seen over the last 4-5 years is massive price increases from Life Companies on ‘older style’ policies in many cases by 60% + on TPD and Income Protection policies and Life and Trauma policy have not fared much better. They have used the LIC reforms as an excuse to put out new ‘styled’ policies, such as income protection with reduced benefits for slightly (at best) cheaper premiums. They have more or less ‘quarantined’ them from claims from the older style policies by continuing to re-rate, meaning massive price increase, their ‘older’ risk policies which are now owned by older clients who are more likely to be of the age/coming into the age where claims occur. This is one of the main reason to sell/for clients to buy policies that see them paying premiums for years and years prior to being likely to claim to make sure they have the cover for when they really need it which is exactly what they put the cover in place for, but they are now being priced out of their policies so life companies can get out of their ‘guaranteed renewal policies’. The increases on the newer ‘styled’ polices have been limited/considerably less than the ‘older style’ policies. I have been encouraged to use this as an excuse to get policy holders to move to the new ‘styled’ policies, which still need to be re-underwritten meaning only available to those who are still able to be underwritten. The effect is that ‘higher risk’ policyholders are left with no option but to pay these massive premium increases if they want to maintain their cover, but the price increase are seeing many cancel their policies as they simply can’t afford to pay and/or feel they can’t trust the life companies who have been able to change the rules to avoid paying claims/to make record profits. Effectively they have found a way to ‘weed out’ the higher risk policies holders and gauge profits. This attack on iExtend’s co-ownership arrangement is just the latest tirade from an industry out of control. Let me continue, it is hard to keep this civil, what do we make of an industry that was forced from 31/12/2024 to re-name ‘Level premiums’ as ‘Variable premiums’.
It seems the ‘Liar Liar Pants on Fire’ meter for the life insurance industry is stuck on ‘Extreme Danager’/ critical fire hazard!
We have to apply BID (Best Interest Duty) to this outrageous behaviour and complain to all who should be sticking up for our clients including APRA, ASIC, ACCC and AFCA now! This has to be stopped.
Comments are closed.