11 October 2016
ASFA supports Life Insurance Code
The Association of Superannuation Funds of Australia (ASFA) has welcomed the Life Insurance Code launched today by the Financial Services Council (FSC).
ASFA Interim CEO Mr Jim Minto said the FSC Code is a very good first step towards implementing life insurance codes to improve consumer outcomes.
“It will help enhance consumer rights and lift standards and consistency in the application of processes, like claims and product management, across the life industry,” he said.
Following the launch of the FSC code that addresses life insurance outside of super, ASFA will now begin work with other industry bodies and participants on a code for life insurance delivered through superannuation.
Today 70 percent of life insurance benefits are provided to Australians through superannuation.
“This is enormously efficient and effective with very significant increases in claims payouts over the past five years in particular,” Mr Minto said.
“It has not been highlighted previously but there has been a revolution in productivity in terms of the cost of delivery of life insurance benefits to people.
“In terms of the percentage of claims paid compared to premiums collected, the superannuation sector is the most efficient in the world.
“Huge productivity gains have been secured particularly over the past five to ten years and these benefits have flowed directly to superannuation fund members through higher payouts.
“As the Australian Ambassador of the International Insurance Society I’ve seen many different models for delivery of life insurance throughout the world and I’m very proud of our Australian super system for the way it delivers benefits to members.
“The downside is that as tremendous growth has occurred, we have not seen the development of consumer protections and uniformity of practice occur at the same rate.”
Mr Minto said the superannuation industry would now embrace the opportunity to work together to lift consumer protections and standards, building from the strong base of the FSC life code launched today.
For further information, please contact:
Teresa Mullan, Media Manager, 0451 949 300.
About ASFA
ASFA is the peak policy, research and advocacy body for Australia’s superannuation industry. It is a not-for-profit, sector-neutral, and non-party political national organisation, which aims to advance effective retirement outcomes for members of funds through research, advocacy and the development of policy and industry best practice.
