The number of consumers purchasing life insurance has dropped 9% to 47% since 2018, with 30% of respondents stating they were not confident the issues identified by the Royal Commission would be fixed, according to a survey.
Research by NobelOak found 30 to 34-year-olds were the most prepared for unforeseen events with as 54% had a life insurance product. The least prepared were the 55 to 60-year-olds, as only 36% had a life insurance produce. Another 60% of respondents said they found life insurance products confusing.
NobleOak chief executive, Anthony Brown, said: “For some, the need for life insurance is more apparent in their 30s and 40s when achieving milestones such as buying a house or starting a family.
“However, life insurance still remains important through the different stages of your life. It is concerning that some people may not be getting the cover they most likely need.”
For those that did not have life insurance, the research found, 65% said they would rely on savings if they contracted a major illness and was unable to earn income, 52% would use health cover or Medicare, and 31% would rely on family and friends.
“Confusion and lack of trust continue to be a barrier for people when considering life insurance. The most common questions consumers have are, what type of cover should I have and how much do I need?” Brown said.
“An increasing number of consumers are underinsured and would rely on savings and family and friends should a crisis occur. Unfortunately, these funds often aren’t enough.”