A resurgence in the life insurance market, particularly in the income protection and disability benefits sector, has been attributed to greater education and understanding of major health issues in the community.
A resurgence in the life insurance market, particularly in the income protection and disability benefits sector, has been attributed to greater education and understanding of major health issues in the community.
As people become more aware of possible health issues, life insurance has become an attractive option for those looking to ensure their family is financially prepared in the case of ill health or loss of the major breadwinner.
Currently worth more than A$1.6 billion1 per annum, the Australian term life insurance industry grew by 11.2% in annual inflows last year (March 2001 to March 2002)2. This growth is expected to remain steady with an estimated average rate of 11.4% per annum to A$4.3 billion by 31 December 20113.
According to Norwich Union's CEO Elect Allan Griffiths, these figures are very positive and show a decidedly strong future for the life insurance market – an area that has been previously considered to be lagging in financial services.
"Over the past few years we have seen informed consumers becoming more conscious of their health and associated risks. People better understand the risks with their health now and know what it would do to their family if the main breadwinner was incapacitated due to bad health or worse," said Allan.
Raising the profile of health has been a priority in many different areas. In 1999 – 2000 the Federal Government spent A$166 million on programs such as injury prevention, nutrition, mental health awareness, suicide prevention, exercise and physical activity, personal hygiene and sun exposure and protection4.
As health issues become higher profile so too do the benefits of the life insurance market.
"Of course with education, people are also discovering how to live healthier lives. One of these ways to is to reduce stress, and the purchase of life insurance is often one way that people can stop worrying about not being prepared for a major change in their own or their family’s lives," said Allan.
Over the past 12 months, Norwich Union has enhanced its life insurance offer and reduced fees where possible.
Navigator (which is part of the Norwich Union Group) has recently launched Wealth Protection – a suite of life insurance products available through independent financial advisers using the funds administration platform.
"I expect we will see an increasing use of life insurance products on Navigator as advisers recognise their responsibility under the 'know your client rules' to grow and protect wealth in all areas of financial services," said Allan.
"A major part of Norwich Union's business is our life insurance arm and we are committed to continued development of our products against market demands."
Allan Griffiths is available for interview.
For further information, please contact:
Bernadette Collins
Public Affairs Manager
Norwich Union Australia
(03) 9829 8892
0407 966 632
1Term Life Analysis, A survey of Australian Term Life, TPD and Trauma Benefits Vol 1 Ed 13, Jan 2003, Sydney.
2Media Release, Life Insurance Industry Results – March 2002, Plan For Life Pty Ltd.
3Term Life Analysis A survey of Australian Term Life, TPD and Trauma Benefits Vol 1 Ed 13, Jan 2003, Sydney.
4Media Release – Public health less than 2% of health expenditure, National Public Health Expenditure Report 1999-00, December 2002, Canberra.
Note to editors:
- Norwich Union Australia is a group of two specialist financial services companies; Navigator and Norwich Union Life. Portfolio Partners, the Australian funds management arm of Aviva plc, is a sister company to Norwich Union. Through these companies we provide products and services in the areas of wealth creation, wealth management and wealth protection for more than 300,000 customers throughout Australia.
- Globally, Norwich Union Australia is part of Aviva plc, the world’s seventh largest insurance group, the largest insurer in the UK and one of the top five life companies in Europe. Aviva was formed in May 2000 through the global merger of CGU plc and Norwich Union plc.
- Aviva is the world's seventh-largest insurance group and the biggest in the UK. It is the leading provider of life and pensions products to Europe and has substantial businesses elsewhere around the world. Its main activities are long-term savings, fund management and general insurance. It has premium income and investment sales from continuing operations of A$73.7 billion, and more than A$520 billion of assets under management (as at 1 April 2003). The group has more than 59,000 employees and 25 million customers worldwide.