The facts about life insurance….
So much emphasis is placed on insuring our cars, property and homes that we rarely consider how we’d pay for all these things if we were to lose our health, life and ultimately our ability to earn an income – our most important asset!
Insurance is often seen in an unfavourable light. This page looks to de-bunk some common misconceptions.
Myth: “Insurance companies don’t pay claims”
Fact: The Financial Ombudsman reported 98% of insurance claims are paid without dispute4. This is a significant percentage of claims that were accepted and simply disproves the myth. As at 30 June 2011 ALI Group had paid a total of $20.2 million5 in claims!
We often share our claims statistics so you can see the variety of claims received, the amount they were compensated and how long the process took.
Myth: “Life insurance is not affordable”
Fact: Premiums can cost less than the price of a daily newspaper or coffee.
81% say life insurance is too expensive, yet 61% overestimate cost6. An important feature of ALI Group’s loan protection is the flexibility to adjust the level of cover, making it even more affordable.
Myth: “My super fund already covers me”
Fact: One in two industry super fund members are underinsured by $100,000 or more7
- 50% are underinsured by $100,000 for life insurance
- 74% are underinsured by $100,000 for TPD
It’s estimated that life insurance cover within super is on average only 20% of what is needed. The average insurance amount payable from super is $70,0008 – for those who take the default level of cover.
1AAMI Fact Sheet, Shopping for Car Insurance, September 2008 | 2Australian Trade Commission Report, Insurance in Australia, 2009 | 3IFSA, A Nation Exposed, Closing the Protection Gap, 20051 General Insurance Code of Practice – Overview of the Year 2009 – 2010 I 4ALI Claims were paid by the registered life insurer of the loan protection products distributed by ALI Group I 5OnePath Life (formerly ING Life) Australia’s Attitudes Towards Life Insurance, Dec 2008 I 62008 survey by Australian Institute of Superannuation Trustees (AIST) and Industry Funds Forum (IFF) – AIST Media Release, 3rd June 2008 I 8Rice Walker Actuaries, Analysis of Insurance Needs, May 2005