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How life insurance is purchased affects the payout Buying life insurance through a superannuation fund often results in fewer disputes, faster processing times and higher "payout ratios" than other ways of purchasing cover, new data show. Statistics from the Australian Prudential Regulation Authority for the year ended June 30 reveal that insurance bought through super funds paid out 85 cents of every dollar of premium in claims for death and 95 cents for total and permanent disability (TPD) claims. When it comes to life insurance, it pays to read the fine print.CREDIT:GABRIELE CHAROTTE For insurance purchased through financial advisers, the payout ratio plunged to 42 cents in the dollar for death policies and 49 cents for TPD. The Australian Securities and Investments Commission's (ASIC) life insurance comparison tool, which uses the same APRA data, shows that for TPD claims there were 19 disputes per 100,000 claims for cover obtained through group insur…

Australians urged to check superannuation balances amid severe insurance premium increases

Australians have been warned to check their superannuation balances after severe increases in insurance premiums come into effect by the end of the year.

Funds have blamed government legislation designed to sweep away inequities in the super system for the increases in premiums, which can range from double-digit increases on death and disability cover to more than 60% for income protection insurance in some schemes.

But with millions of workers not regularly checking their super accounts for new fees and charges, consumer advocates have warned that people could be paying for expensive cover that they do not want or need.

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