Over the last 20 years the insurance industry has experienced a phase of rapid evolution and growth. This has resulted in a significant product innovation as well as increased variety in the products on offer.
These days you can’t watch TV for more than 20 minutes without seeing an ad for ‘Direct’ insurance products. These products are generally a simplified, more costly version of traditional ‘retail’ insurance products
‘Direct’ insurance products, often involve no underwriting or a less thorough underwriting process as they often offer a blanket exclusion for any claims relating to or connected with any pre-existing condition that you may have suffered from. Underwiting is then done at the time of claim which can often cause unnecessary stress. This lack of certainty is a distinct disadvantage of buying a “direct” product.
Contrary to public perception, most direct products are very much more expensive than the quality retail products available through professional advisers such as ourselves.
As you can see below, we have sourced insurance rates for a generic scenario for someone looking for life insurance. The results are staggering, with Real Insurance quoting a premium in excess of double what can be found through one of the retail insurers that Curo uses. This highlights just how much more money you could be paying a direct insurer, offering no advice as opposed to purchasing your cover through a financial adviser that offers ongoing professional advice and service.
Scenario: 40 year old male, non-smoker living in NSW, working in an office as a manager that is looking for $500,000 Life Insurance*
| Insurance Company | Premium | How much more expensive is it? |
|---|---|---|
| Cheapest available through Curo Financial Services | $20.50 per month | $0, this is the cheapest available |
| AAMI Life Insurance | $66.50 per month | $46 per month, over 220% more expensive |
| ANZ Insurance | $43.92 per month | $23.42 per month, over 100% more expensive. |
| NRMA Insurance | $63.53 per month | $43.03 per month, over 200% more expensive |
| Zurich Direct Insurance | $43.28 per month | $22.78 per month, over 100% more expensive |
| Woolworths Insurance | $76.50 per month | $56 per month, almost 400% more expensive |
*Rates reflective of quotes completed on the 8th of October 2020
It is also vital to remember the value that a professional life insurance adviser can add to your insurance policy. You purchase insurance so that you have the ability to claim should the need arise. When you take out a policy through a qualified adviser they will accompany you every step of the way.Curo’s Insurance advisers handle claims on a regular basis and their ability to expedite and provide far greater results in the claims process is unquestionable. With some claims being finalised in as little as two days, it is important to remember why you are buying insurance and that there is a lot more to it than a 20 minute phone call to a call centre operator at a direct insurance company.
General Advice Disclaimer
General advice warning: The advice provided is general advice only and in preparing it we did not take into account your investment objectives, financial situation or particular needs. Before making an investment decision on the basis of this advice, you should consider how appropriate the advice is to your particular investment needs, and objectives. You should also consider the relevant Product Disclosure Statement before making any decision relating to a financial product.
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