AIA Australia to launch new Income Protection cover before APRA guidelines

09 December 2020

AIA

AIA Australia is a leading life, health, and wellbeing insurer driven by a purpose to help people live healthier, longer, better lives.

Ahead of the APRA Income Protection guidelines due to come into effect in October 2021, industry-leading life and health insurer AIA Australia is set to introduce a new form of cover to its Income Protection (IP) suite on 18 January 2021: Income Protection CORE cover (IP CORE).

Released in December 2019, APRA’s sustainability guidelines on Individual Disability Income Insurance (IDII) saw agreed value withdrawn from new business sales at the end of March 2020, with additional product changes scheduled for the following year. The measures are in response to a history of heavy losses in respect to IDII, which APRA Executive Board Member Geoff Summerhayes has stated risk seeing insurers withdraw from the market.

Introducing IP CORE

This first-to-market product release marks the latest initiative by AIA Australia to deliver products that offer greater value to customers amid significant changes impacting the industry. In October 2020 the insurer introduced Crisis Extension, making it possible for customers to purchase more affordable and flexible cover for major crisis events, and its science-backed health and wellbeing program, AIA Vitality, was the first of its kind in the Australian market, offering members rewards and incentives to learn more about their health and take steps to improve it.

Set to be run in parallel with IP, IP CORE is designed to ensure advisers can begin transitioning their education, business and customers ahead of the APRA guidelines becoming an industry standard, and will also allow time for the product to be refined according to adviser and industry feedback.

How IP CORE works for you and your clients

Like regular IP cover, IP CORE provides a monthly benefit to customers who become Totally or Partially Disabled. By combining Crisis, Crisis Extension and TPD, IP CORE enables a customer’s premiums to be managed through all benefits. If, for example, your client suffers an injury but returns to work, they’ll still have additional cover in place to protect them for future issues or if their condition deteriorates further down the track.

When working with your clients, it’s important that you’re able to identify where IP CORE could be utilised as an alternative to their current IP cover. Benefits for you and your clients could include addressing long-term affordability concerns, increasing retention, minimising premium rates and initiating a stepping stone insurance strategy.

At AIA Australia, supporting and protecting the financial security of our clients is what matters most. Key to this commitment is maintaining a strong insurance industry that delivers sustainable, affordable, flexible products that create value for customers, advisers and insurers alike.

Copyright © 2020 AIA Australia Limited (ABN 79 004 837 861 AFSL 230043). This is general information only, without taking into account factors like the objectives, financial situation, needs or personal circumstances of any individual and is not intended to be financial, legal, tax, medical, nutritional, health, fitness or other advice.\

  • You may also be interested in