Risk advised clients have a higher rate of claims admittance than non-advised individuals in almost every cover type, according to Australian Prudential Regulation Authority (APRA) data.
APRA’s data found advised individuals had a claim admittance rate of 82% for total and permanent disability compared to 64% of non-advised individuals, and 89% for group super.
Similarly, disability income insurance had an advised and group super claim rate both at 95% compared to 89% for non-advised.
“Generally, individual advised business shows higher admittance rates than Individual non-advised for the same cover type,” APRA said.
“This could be due to the policyholder having clearer expectations up front of what is covered by the product, or (related to the previous point) the adviser discouraging the policyholder from lodging a claim that is not covered by the policy.
“The exception is individual advised accident, which has an unusually low admittance rate. However, the number of observations is quite small (15 finalised claims, versus 2,899 for non-advised).”
Claims admittance rate by cover type and distribution channel