Insurance was emerging as a potential differentiator as funds and financial-service providers design MySuper products, according to speakers at the AIA-Conexus Financial Group Insurance Summit this week.
Damian Hill, chief executive officer of REST Industry Super, told the summit that his fund was “looking to take advantage” of the opportunity to include innovative insurance options in its MySuper product.
Insurance was part of the “value proposition” of MySuper, and there was some flexibility on what funds could offer.
Insurance for all
“Differentiating on investment in MySuper is hard to do,” said Hill. “But insurance is a rich area, which will almost be open slather in terms of differentiation.
“Will it be vanilla or chocolate chip? There are opportunities in the market to make major changes.”
Melanie Evans (pictured right) the head of superannuation and retail at BT Financial Group, told the summit that BT had changed its view of insurance in default plans and would be introducing default insurance to all members “in the next month”.
When average isn’t enough
Beyond default, there was the possibility of customising insurance and designing insurance products “for people who are not the average.”
“You can put your head in the sand or you can move forward,” Evans said.
“There’s a whole legislative change coming to the industry and you have to stay ahead of the curve.”
Ian Fryer (pictured right), head of research at Chant West, told the summit that default income-protection (IP) cover, for example, was one way to begin engaging with fund members on the issue of insurance.
“If people have some level of IP cover, you can at least talk about it and ask if it is enough,” said Fryer.