Life Insurance Takes Backseat in Cost-Cutting Measures
Life Insurance Takes Backseat in Cost-Cutting Measures
The information on this website is general in nature and does not take into account your objectives, financial situation, or needs. Consider seeking personal advice from a licensed adviser before acting on any information.
As Australians tighten their belts in the face of rising living costs, life insurance is rapidly being placed on the chopping block.
The Council of Australian Life Insurers (CALI) reports that individuals are more likely to reduce life cover rather than home or car insurance.
Recent findings indicate a significant disparity between those holding different types of insurances. Approximately 79% of the population has motor insurance, yet only 34% have life insurance according to the independent research conducted by the council.
The survey, which examined the behaviors of 5,000 people, highlights a particularly stark gap among individuals aged 55 to 64. More than 80% maintain motor or home insurance, but a mere 29% have acquired life insurance. Age groups 35-54 show that 38% hold life cover whereas this number drops to 32% for younger adults.
Interestingly, working Australians are three times more likely to drop their life insurance as compared to home or car policies, underlining a trend that could have long-term financial ramifications. Additionally, about 50% of those surveyed suggest they would stop superannuation contributions if it meant reducing expenses.
According to CALI CEO Christine Cupitt, the situation accentuates the “advice accessibility crisis in this country.” She explained, "The advice needs of Australians are not being met, particularly for those who can’t afford to pay for a financial adviser in a cost-of-living crisis."
Cupitt stresses the importance of receiving proper financial guidance, stating, “Getting the right advice can set them up for the future, getting no advice can leave them with nothing to fall back on when times get tough.”
Despite recognizing the importance of advice, over 40% of respondents expressed a desire for customized financial guidance. This need could potentially be met through tranche two of the federal government’s Delivering Better Financial Outcomes reforms, designed to bridge this gap.
This push for enhanced financial advice platforms underscores a larger narrative about the necessity for accessible, affordable advisory services, especially during challenging economic climates. According to the original report covered by the Council of Australian Life Insurers, ensuring Australians are adequately insured and advised is essential.
Published:Tuesday, 3rd Dec 2024 Author: Paige Estritori Sources
Please Note: If this information affects you, seek advice from a licensed professional.
In August 2024, a café and catering business faced significant challenges after a storm forced its closure. The establishment remained shut until January 2025, during which time the insurer, Suncorp, accepted the claim and completed necessary repairs. The insurer compensated the business with $280,570 for a year's gross profit loss and an additional $26,863 for increased operational costs. - read more
In December 2025, a landlord faced a denied insurance claim after failing to disclose that the upper floor of their building was used for weekly religious meetings. Initially insured as a restaurant, the premises' change in use was not communicated to the insurer, AIG. Following a theft claim in 2023 amounting to $99,295, AIG declined coverage, citing non-disclosure of the building's actual use. - read more
In November 2024, leading Australian hospitality and business organisations launched RespectInHospitality, a microsite dedicated to providing resources, training, and templates aimed at fostering respectful and safe workplaces within the hospitality sector. This collaborative effort includes the Australian Hotels Association NSW, Night Time Industries Association, Independent Bars Association, Clubs NSW, Restaurant & Catering Association, Business NSW, and Hospitality Industry Insurance. - read more
In a significant move to accommodate the evolving landscape of strata developments, CHU, Australia's leading strata insurance underwriting agency, has more than doubled its maximum single risk capacity. The agency now offers coverage up to $690 million, a substantial increase from the previous limit of $300 million. This enhancement applies to both residential and commercial strata properties, reflecting the trend towards larger and more complex strata developments across the country. - read more
CHU, Australia's premier strata insurance underwriting agency, has expanded its suite of insurance products to better serve the diverse needs of strata communities. The agency now offers tailored landlord insurance and home and contents cover specifically designed for individual lot owners, regardless of who holds the association's common property policy. This initiative provides lot owners with the flexibility to select coverage that aligns precisely with their property and occupancy circumstances. - read more
Life insurance can seem complex at first, but understanding the basics can help demystify this important financial product. At its core, life insurance is a contract between you and an insurer, where the insurer promises to pay a designated beneficiary a sum of money upon your passing, in exchange for premium payments. - read more
When you’re young, life is all about new experiences and making plans for a promising future. While factors like travel, career, and relationships often take centre stage, one aspect often overlooked is life insurance. It might seem like something to consider later in life, but starting a policy while you're young can be a savvy financial move. - read more
Life insurance is a crucial part of any comprehensive financial plan, providing peace of mind that your loved ones will be financially secure in the event of your passing. - read more
For many millennials, navigating the complexities of personal finance and future planning can feel like a bewildering journey. Among these financial responsibilities, life insurance emerges as a paramount consideration. More than just a safety net, life insurance can be the cornerstone of a sound financial strategy, providing peace of mind for both the policyholder and their loved ones. - read more
Welcome to a pivotal guide dedicated to empowering you with the essentials of income protection insurance in Australia. As we navigate through times of uncertainty, safeguarding your financial wellbeing becomes not just a priority, but a necessity. Income protection insurance stands as one of the key pillars of financial security, ensuring a steady flow of income during periods when you're unable to work due to illness or injury. - read more
Start Here !
Apply now for your free Insurance assessment and price comparisons!
Knowledgebase
Trauma Insurance: An insurance that pays a lump-sum amount on the diagnosis of one of several critical illnesses or events
