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How premium re-pricing helped group insurers
The Government’s Protecting Your Super (PYS) legislation has certainly dragged on the major life insurers, but it has not been all bad balance sheet news, according to specialist life/risk research house, Dexx&r.
The latest Dexx&r analysis has found that while the PYS measures meant fewer members had default cover, re-pricing existing benefits had enabled life companies active in the group market to increase total premium received.
It noted that total in-force group risk premium increased by 2.1% from $6.1 billion at September, 2019, to $6.2 billion over the 12 months to September, 2020.
The Dexx&r analysis said that over the twelve months ending September 2020 one of the top five companies in the group market recorded an increase in in-force group premiums with TAL’s in-force business increasing by 31% to $2.3 billion.
“TAL’s large increase in inforce business over the 12 months to September 2020 is largely due to inflows following the transfer of Rest Super’s group insurance mandate, previously with AIA Australia,” it said.
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The $135 billion fund has transitioned away from TAL Life Insurance following an “extensive tender process”.
The $80 billion fund is facing legal action over allegedly signing up new members to income protection insurance by default without active member consent.
In a Senate submission, the Financial Services Council has once again called for further clarification that the government will assess the consumer outcomes of group insurance against the enshrined objective of superannuation.
TAL has launched a digital solution TAL Connect for its superannuation fund partners that links super and insurance for members, with Aware Super as its launch partner.
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