Zurich reduces TPD rates
Zurich Financial Services Australia has joined MLC by changing their total and permanent disability (TPD) premiums in the lead up to the Life Insurance Framework (LIF) transition in July next year.
Zurich said its changes were to increase simplicity, affordability, sustainability, and to deliver genuine benefits to advisers and customers.
Zurich's general manager for life and investments, Philip Kewin said "while this is only the first step, it's a very important one, as we are determined to see an industry response to LIF that goes beyond adviser remuneration and delivers genuine benefits to advisers and customers".
"The retail income protection market has faced many challenges in recent years, with rapidly deteriorating claims experience being reflected in a seemingly constant cycle of rate increases," he said.
The insurer's changes include simpler pricing structures, a reduction in term and TPD new business premium rates, and the launch of new income protection products.
Kewin said its wealth protection policies would benefit from at least two years of rate certainty.
"We are effectively keeping the underlying base rates unchanged for the first two years of the policy, to give advisers and customers added confidence and certainty about the cost of cover," Kewin said.
Recommended for you
The Federal Court has dismissed a conflicted remuneration case brought by ASIC against the director of life insurance distributor Freedom Group, where Bali holidays and Vespa purchases were among sales incentives.
Policy and advocacy specialist Benjamin Marshan has left the Council of Australian Life Insurers after less than a year, having joined in March from the Financial Planning Association of Australia.
The declining volume of risk advisers meant KPMG has found a rising lapse rate for insurance policies arranged by independent financial advisers, particularly in the TPD and death cover space.
The Life Insurance Code of Practice has transferred from the Financial Services Council to the Council of Australian Life Insurers.
