Blue collar workers see biggest premium hikes
Members of not-for-profit superannuation funds are seeing the biggest premium hikes on death and total and permanent disability (TPD) insurance, Super Ratings reveals.
Data from the research house found that blue collar workers had seen the biggest premium increases between 2011 and 2015 (44.3 per cent for male workers, and 45.1 per cent for female workers), while those who held TPD cover through corporate funds saw their premium fall in the same period.
Despite the rising cost of death and TPD insurance through super, Super Ratings general manager, consulting, Wendy Tse, said it remained affordable.
"Whilst some form of cross-subsidisation is a key tenet of any group insurance policy, we believe funds can do more to individually tailor insurance premiums varying gender and occupational categories, rather than utilising a range of blended rates for all members," she said.
"This will ensure any future premium increases (or potential reductions) can be accurately targeted at those segments of a fund that claim more frequently."
Tse urged super funds to adopt a more proactive approach to engage with members to improve claims processing and minimise unnecessary legal involvement.
"With commentary regarding the non-payment of claims in the market, funds must remember insurance is provided to members as a protection mechanism in the event of unfortunate personal circumstances and making it more difficult for members to claim and receive a benefit cannot be a positive outcome for the industry as a whole," she said.
AUTHOR
Nicholas O'Donoghue
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