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APRA releases insurance claims statistics

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Significantly more death, total and permanent disability (TPD) and disability income (DII) claims are being declined by insurers if they come from non-advised customers compared to financial advisers.

The latest Australian Prudential Regulation Authority life insurance claims and disputes statistics show the admittance rate for death claims from individual advised clients is nearly 97%, compared to 88% for non-advised clients. And 85% of TPD claims are accepted from individual advised clients compared to 73% for non-advised clients.

Nearly 95% of DII claims are being accepted from advised clients compared to 85% from non-advised clients. The rate is the same for trauma claims (87%).

The claims-paid ratio is widely variable between advised and non-advised clients among the different types of cover. Individual advised TPD policies have a claims-paid ratio of 46%, against 58% for non-advised policies. The claims ratio for trauma for individual advised customers is 59%, against 41% for non-advised. Individual advised death policies have a claims-paid ratio of 42% against 39% for non-advised customers.