Push to close insurance gap

Richard Gilbert

Just a week out from its national conference, the Investment and Financial Services Association has called on both the Federal Government and regulators to back industry efforts to help overcome Australia’s underinsurance problems.

What is more, IFSA research has suggested that the insurance gap could be closed for many people for as little as $2.83 a day.

In a “headland” statement released this week, IFSA has also proposed a policy review of the life insurance industry to examine the “public good” nature of life insurance and income protection products and to examine the underlying social and economic consequences of the underinsurance problem.

IFSA chief executive Richard Gilbert said the review would also look at new ways of encouraging the take-up of life insurance and income protection products and ways of reducing impediments to their take-up.

He said IFSA believed that industry, Government and regulators needed to collectively devote more attention to making it easier for Australians to protect their income, their families and their lifestyle.

Gilbert said that among the more interesting findings relating to underinsurance was that for an average 31-year-old married man with two children earning $75,000 a year, it would cost an average of only $2.83 a day to fund $750,000 in life insurance and $4,700 a month in income protection insurance.