When looking for risk policies it can be easy for consumers to focus solely on the cost of insurance rather than the benefits each policy can provide, says insurance comparison company Lifebroker.
Lifebroker general manager Alex Homer said clients do not realise that insurance policies are not all the same, so when comparing policies they often look at the price rather than the benefits or exclusions of the policies.
“To compare them on cost alone, without other features being taken into account, unrealistically lumps them all in one basket,” Mr Homer said.
“[This] can lead to unpleasant surprises when you need to call on your policy,” he added.
Mr Homer claims that this is where Lifebroker’s new comparison tool can help Australians make more informed decisions and assess policies by criteria other than cost.
It allows for more meaningful information on factors such as company size, financial strength and claims experience, conditions covered and policy exclusions, Mr Homer said.
“This represents a change from similar research over recent years and, I would hope, is an example of consumers’ increasing understanding of the benefits of life insurance, beyond cost.
“Further, we know that a significant number of our customers want to make a comparison on the detailed features and benefits of life insurance policies rather than solely on price. Our answer has been to develop this tool,” Mr Homer said.
Since launching the new comparison tool, Mr Homer said that while 44 per cent of users are opting for a simple price comparison, 37 per cent have chosen a more comprehensive comparison.
“Accurate and meaningful comparison of life insurance will help people make the right decisions about a crucial aspect of their financial wellbeing, minimising worry and hopefully helping them to sleep soundly at night,” Mr Homer concluded.