A hot topic this week was direct insurance and the lack of consumer protection or understanding of what they are signing up to.
In the article Advisers angry at claims experience
, risk adviser Anita Muecke talked about her experience with a client who had purchased life insurance – thinking she and her husband would be paid out should one of them die – without the bank-owned insurance company asking health questions or explaining the broad exclusions, which included any condition the insured had for the six years before the date of application.
It seems other advisers are also upset the public are not receiving any advice from bank-owned life insurance companies, before they take out insurance.
James Agar cfp
wrote: “Disgraceful - what would you expect from the large banks & life offices. What about transparency, client best interest, research, strengths & weaknesses options for stepped and level premiums. All advisers and clients should be complaining to ASIC and the government ( Local member ).”
advised: “What people need to do is to take advantage of the cooling off period and get some formal advice in regards to the policy they have applied for. The so called fine print such as pre-existing conditions need to be made more apparent to the future policy holder. For example travel insurance is pretty upfront about pre-existing conditions so why can't life insurance do the same thing?”
Sue Laing – The Risk Store
wrote in response to AFA CEO Brad Fox, who was quoted in the article: “Brad I agree that this is an issue that is well within the AFA's remit, but not for you to tackle alone. However given that all of the organisations responsible for either underwriting and/or distributing all the direct products on the market are full members of the FSC (on their latest published list) - that approach would be a hiding to nowhere.”
And Paul Levy
stated: “STOP DIRECT SELLING....CLAIM TIME IS NOT THE TIME A CLIENT WANTS TO HEAR THAT THEY WERE NOT COVERED!!”
Read the article and more comments here.