{"id":80218,"date":"2025-11-18T07:47:36","date_gmt":"2025-11-17T20:47:36","guid":{"rendered":"https:\/\/riskinfo.com.au\/news\/?p=80218"},"modified":"2025-11-25T08:42:52","modified_gmt":"2025-11-24T21:42:52","slug":"aia-warns-of-structural-change-in-life-sector","status":"publish","type":"post","link":"https:\/\/riskinfo.com.au\/news\/2025\/11\/18\/aia-warns-of-structural-change-in-life-sector\/","title":{"rendered":"AIA Warns of Structural Change in Life Sector"},"content":{"rendered":"<div class=\"header row\">\n<div class=\"intro\">\n<h3>AIA Australia&#8217;s cautionary note that the life and health insurance industries are facing structural change, driven by mounting mental health claims, generated lots of reader interest this week&#8230;<\/h3>\n<\/div>\n<\/div>\n<p>AIA Australia CEO <strong>Damien Mu<\/strong> has cautioned advisers that the life and health insurance industries are facing structural change driven by mounting mental health claims, rising premiums, and ongoing cost-of-living pressures.<\/p>\n<p>Speaking during the company&#8217;s online Thrive for Life presentation last week, Mu said economic volatility, regulatory churn, and affordability challenges were making current life insurance models unsustainable.<\/p>\n<p>\u201cMost households could afford only two mortgage repayments if they lost their income,\u201d he said. \u201cAt the same time, premiums, schooling costs, and everyday expenses keep rising \u2013 it\u2019s a serious issue for customers and advisers alike.\u201d<\/p>\n<p>Mu said claims patterns have also shifted in the past decade, with mental health claims doubling since 2014.<\/p>\n<blockquote><p>Mental health claims are really having a negative impact across the industry&#8230;<\/p><\/blockquote>\n<p>\u201cAround 70 percent of our claims this year have come from white-collar workers,\u201d he said. \u201cCovid, hybrid work, and digital disruption have left many people struggling to adapt.<\/p>\n<p>\u201cMental health claims are really having a negative impact across the industry, and but more importantly, the cost of productivity and the impact on people&#8217;s lives. Mental health doesn&#8217;t discriminate by age.\u201d<\/p>\n<figure id=\"attachment_70048\" aria-describedby=\"caption-attachment-70048\" style=\"width: 163px\" class=\"wp-caption alignright\"><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-70048\" src=\"https:\/\/riskinfo.com.au\/news\/files\/2024\/02\/damien-mu-e1708907551389.jpg\" alt=\"\" width=\"163\" height=\"197\" \/><figcaption id=\"caption-attachment-70048\" class=\"wp-caption-text\">Damien Mu.<\/figcaption><\/figure>\n<p>To restore affordability and ensure product longevity, he said AIA Australia is focusing on sustainable pricing and severity-based product design rather than comprehensive, high-cost TPD cover.<\/p>\n<p>Mu said the insurer\u2019s long-running TPD Assist model, which supports clients\u2019 gradual return to work, had delivered strong outcomes and would inform future product refinements.<\/p>\n<p>He also urged advisers to reassess product selection through a long-term affordability lens.<\/p>\n<p>\u201cComprehensive cover might look attractive upfront, but sustainability matters more to clients who need to maintain protection over time,\u201d he said.<\/p>\n<blockquote><p>&#8230;we need a system that works for advisers, clients and insurers&#8230;<\/p><\/blockquote>\n<p>Mu also said industry, regulators, and advisers would need to move together to modernise best-interest duties and support the transition to more sustainable life insurance structures.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>AIA Australia&#8217;s cautionary note that the life and health insurance industries are facing structural change, driven by mounting mental health claims, generated lots of reader interest this week&#8230; AIA Australia CEO Damien Mu has cautioned advisers that the life and health insurance industries are facing structural change driven by mounting mental health claims, rising premiums, [&hellip;]<\/p>\n","protected":false},"author":23,"featured_media":80221,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[48,241,8291,5121],"tags":[],"class_list":{"0":"post-80218","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-company-news","8":"category-conferences-and-events","9":"category-story-of-the-week","10":"category-sustainability"},"_links":{"self":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/80218","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/users\/23"}],"replies":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/comments?post=80218"}],"version-history":[{"count":0,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/80218\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/media\/80221"}],"wp:attachment":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/media?parent=80218"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/categories?post=80218"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/tags?post=80218"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}