Young advisers need to take more active role

Young advisers need to take a more active role in tackling the underinsurance problem by talking to young clients and convincing them of the need for insurance, according to Synchron director Don Trapnell.

Trapnell said a typical client for a young adviser is a generation X or Y member, and it is these people who are typically underinsured and need to be convinced of the need for insurance.

Trapnell also said the Government could provide incentives for people to take up more insurance, for example, by reducing life insurance premiums with tax deductions.

Richard Gilbert, chief executive of the Investment and Financial Services Association, said the majority of Australians who are underinsured are predominantly members of the younger generations.

However, while younger advisers were the way of the future, there were increasing numbers of advisers, young and old, who saw insurance protection as part of the portfolio for all their clients, Gilbert said.

Richard Klipin, the chief executive of the Association of Financial Advisers, said young advisers needed to develop the skills to give appropriate insurance advice, including the ability to communicate “frankly” with their clients on the need for insurance.

"It’s an area that needs a lot of work," he said.

Trapnell also said the Government could provide incentives for people to take up more insurance, for example, by reintroducing tax deductions for life insurance premiums.