Why pay for advice? Consumers opt for “Robo” Life Insurance

Australians are increasingly looking to “cut out the middle man” when it comes to Life Insurance, with the majority of people not willing to pay for financial advice.

Earlier this year NobleOak released the results of a 2017 study1 into the impact of technology on the Life Insurance industry.

One of the most interesting findings was the fact that the majority (55.9%) of respondents are unwilling to pay anything for Life Insurance advice.

So what exactly is this statistic telling us?

• DIY Life Insurance is getting easier.

Life Insurance has traditionally been a complicated purchase that many people choose to outsource to a professional. Now, through improved technology and better to information, it’s becoming easier to research and compare Life Insurance policies online.

• Financial advice has little perceived value.

There’s no doubt that financial advice is helping many Australians become more financially secure. The challenge for financial advisers is convincing people that they need to pay for this advice, bearing in mind many advisers now operate on a fee-for-service basis rather than relying on built-in commissions.

• Price is a key factor when purchasing Life Insurance.

Cost of premiums was cited by 80.5% of respondents as one of the most important factors when purchasing Life Insurance. This helps explain why so many consumers are not willing to pay more for financial advice.

What we’re doing about it

At NobleOak, we have a proud history of offering Life Insurance directly to customers. We believe this is a great way to keep the costs of Life Insurance down, provided people can get the right information and support to ensure their cover is suitable for them.

Over the years we’ve found that one of the most common questions around Life Insurance is how much cover people need. To address that need, we’ve created a Life Insurance Assessment Calculator. It only takes about 5 to 10 minutes to complete and is free to use.

If you’re interested to know how much Life Insurance you should have, or whether your current cover provides the right protection, we invite you to give it a try.

You can download the full “Life Insurance in Australia – Consumer Behaviour Transformation” research paper here.

 

1 Research conducted by Pureprofile in November 2017 with 1,006 Australian resident respondents.