"If you look at the numbers for group insurance in Australia, it is the most efficient insurance system in the world in terms of life insurance, pay out ratios – and value. The cost to the government and the broader economy of removing the default insurance system in superannuation is $5.7 billion annually – when you look at lost tax revenues, reduced spending, and social security benefits.” Read more about the value of default cover in our recent submission to the Productivity Commission inquiry assessing the competitiveness and efficiency of the superannuation system here.
“As an industry we are making a measurable economic difference to society.”
Damien continued to break these numbers down. “Over the last three years over $13 billion has been paid out in claims, but what do those numbers mean? It means that, as an industry, we were collectively there for over 200,000 Australians and their families.
“From here, we should always be looking at the courage of our convictions; what we do to make a difference as an industry. If we continue to be on the fringes of where our beliefs are, then we will continue to meet with distrust. But if we can be strong in our beliefs and acknowledge where our failings are – and where we’re looking to improve industry-wide – then we can engender that trust.
Referring to member trust as one such success indicator, he continued to demonstrate its value. “I actually think we don’t have to have the media telling our stories, instead let’s look at how members and customers can positively tell our story instead.”
Damien also touched on the vehicle of superannuation as a means to deliver more customer value, along with the industry need to address issues around inequity and cross subsidisation, given the impact this can have on younger and older members when it comes to providing a default cover across all of Australia.
“We’ve got to attack this issue,” Damien said, in closing. “To make sure we get the balance right between the erosion of the account to cover insurance – and how to engage members to not just rely on their default cover but to help them make the choices that they need to make; to get the right cover in place.”
To read more about the Summit, follow the links below.