Independent research commissioned by the Council of Australian Life Insurers (CALI) has shown that additional superannuation contributions would be one of the first things people are most likely to cut from their budgets, impacting their future financial health.
“The advice accessibility crisis in this country is leaving far too many people underinsured and unprotected when it comes to their future financial security,” CALI CEO Christine Cupitt said.
“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.”
The research showed that Baby Boomers and Gen Xs approaching retirement are the most likely to insure their material possessions over their financial future. Ninety per cent have cover for their car and more than 80 per cent for their home, while less than a third have life insurance.
On average, working Australians are almost three times more likely to cut life insurance from their budget compared with cover for their car or home.
“This is about people building strong financial safety nets for themselves and their loved ones. 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,” Cupitt said.
“With ongoing cost-of-living pressures, people need someone to talk to about their financial future now more than ever.”
Currently, Australia’s life insurers are restricted to providing their customers with advice that is general in nature only.
The data shows that more than 40 per cent of people want advice that’s more personalised and helps them decide how much cover they need and the products that best suit them.
Under tranche two of the federal government’s Delivering Better Financial Outcomes legislation, this is the kind of advice life insurers would be able to provide customers when they ask for it, at no extra cost.
“Less than a quarter of people are telling us they want basic information only, proving just how critical financial advice reforms will be to giving Australians the kind of advice they want, when and where they want it,” Cupitt said.
