MLC Life Insurance has welcomed the Albanese Government’s commitment to implement 14 of the 22 recommendations made by the Quality of Advice Review, while also calling for more Australians to be given access to simple personal advice from their insurer.

“We’re pleased to see the Albanese Government delivering better financial outcomes for Australians, with clear reform to make financial advice more accessible and the intention to allow members of superannuation funds to access advice on an affordable basis through their fund,” says Kent Griffin, Chief Executive Officer of MLC Life Insurance, “but more can be done to look after those that need access to affordable, simple advice.”

“Australia’s superannuation system is world-class, in providing consistent wealth creation to working Australians while providing them a default base cover of insurance,” says Kent Griffin, “and the government’s announcement to allow super funds to provide advice to their members is a terrific step in the right direction.”

“The same notion that would see super funds provide customer service so their members have access to personalised information to make the right choice for their circumstances, is also true for Australia’s life insurers,” he said.

Life insurance plays a critical role in providing financial security and peace of mind for Australians and protecting them in life’s most vulnerable moments, but currently millions of Australians are unable to speak to their insurers about their personal circumstances to ensure they have the right coverage.

“Australians are asking pretty basic questions, all ultimately seeking appropriate coverage that’s affordable and accessible,” says Michael Rogers, Chief Individual Insurance Officer for MLC Life Insurance, “and it is virtually impossible to help if we can’t provide simple advice to our customers that suits their personal circumstances.”

“Every day, customers contact us for help as they seek to ensure they have the most appropriate cover at an affordable price. In instances where the customer no longer has an adviser, the current advice rules mean we’re simply not allowed to assist them,” says Michael Rogers. “This isn’t about making sure more people have more insurance, we want to make sure our customers have insurance that’s affordable, accessible and appropriate.”

“From a consumer protection perspective, most people believe they are seeking basic customer service and the Quality of Advice Review clearly identified that the current situation doesn't provide enough choice for Australian consumers who are seeking simple insurance advice that isn't comprehensive.”

In most cases, customers are simply seeking guidance to help them make a decision about their coverage in the face of changing life circumstances, including the birth of a child, the purchase of a home, or a change in their employment.

“For many Australians a financial adviser is an important investment, but for some they are simply looking to check their coverage or review their policy,” says Michael Rogers.

“Like super funds, insurers are governed by an obligation to act in the interests of our customers, including section 13 of the Insurance Contracts Act of 1984, which imposes a statutory duty of utmost good faith on life insurers, and has been interpreted by the courts as requiring the insurer to look to the interests of the policy holder,” says Kent Griffin.

This provision allows for damages as well as imposing penalties for breaches.

“These obligations are in addition to the many consumer protection and conduct obligations by which life insurers are currently restricted to operate only in the interests of customers and potential customers,” says Kent Griffin, “including the requirement to operate efficiently, honestly and fairly, anti-hawking requirements, product design and distribution obligations, prohibition on misleading and deceptive conduct, and the imminent Financial Accountability Regime.”

Life insurers, like trustees and super funds, operate in an environment where the interests of customers are at the core of the business, both culturally and because of a robust regulatory environment.

“It is clearly in the customer’s best interest to enable them to get the help they need from their insurer, to help them understand the appropriateness and affordability of their cover,” says Michael Rogers, “and some key guardrails will help ensure consumers are protected.”

MLC Life Insurance has joined industry calls for legislating consumer protections including education standards, quality assurance and oversight, clear limits to the scope of simple advice, as well as the expansion of the Life Insurance Code of Practice.

“These protections are all about making sure consumers are given the advice that’s appropriate to their needs,” says Michael Rogers, “so we can offer affordable and appropriate insurance to everyone, not just those that can afford financial advice.”