Life Insurance Consolidation Will Affect Aussies
TOWER Insurance Australia has warned that Australians will suffer higher product margins and limited products if the life insurance industry continues to consolidate.
"In terms of increased life market consolidation, we see major consumer concern impacts around consolidation and believe the ACCC and Government should look at this closely. We do not believe this is in the best interests of Australians as consumers." said Mr Minto, Tower's Managing Director.
"The transformation of the market to fewer, larger players creates a concern that Australians will lose choice amongst life insurance providers as well as see a loss of independent companies and innovative solutions. We will potentially see Australians being offered higher margin products as a result. Life insurance is not a price and value sensitive consumer commodity product and large players with power can create reduced choice and higher prices."
"Life insurance is not well understood by the wider community but many have benefited from it in a difficult time in a person's or family's life. Life insurance can help give people dignity and choices in times of illness and bereavement."
Mr Minto said that life insurance delivered a large social benefit and that the company was proud of its purpose and the value it delivered.
"We believe the life market which has grown at over 10% per annum for 15 years will continue to grow strongly driven by the tremendous purpose and value life insurance delivers and the large underinsurance levels of Australians.
"TOWER Australia's broad distribution footprint has helped us to sustainably grow at or in excess of market rates. It is the strength of the strategy and overall positioning coupled with execution that has stood us in good stead competitively."
He said the company was very positive about the year ahead with writing sustainable business and improving the company's return on capital as some of the key priorities.
TOWER Australia Group Limited has continued to grow strongly in 2009 and this momentum has continued into 2010.
For more information on Life Insurance Consolidation Will Affect Aussies please refer to www.xLife.com.au
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