The new Income Insurance products launching industry wide, as a result of APRA’s sustainability measures, are going to reduce the income replacement ratio along with some of the additional benefits that have been added to these products over time. This creates a new challenge for Advisers as they consider how they utilise a range of product solutions for clients to provide the benefits and protection they need, at a price point that is affordable.

To support these conversations, we have pulled together some considerations for the role lump sum covers may play when the new Income Insurance products go live on 1 October 2021.

The role lump sum covers (TPD & CI) may play post 1 October 2021.

With the changes to the design of Income Insurance products, there could be an increased need and consideration of complementary lump sum covers such as TPD & CI.

Changes to income replacement ratios for Income Insurance and growing pricing pressure on longer term benefit periods will mean that advisers need to deeply consider the combination of covers that best meet a client’s needs, objectives and overall budget.

Matching shorter term Income Insurance benefit periods such as 2 & 5 years with complementary lump sum covers is expected to be part of the considerations that advisers will make as a result of the changing industry landscape.

Lump sum covers, such as Total and Permanent Disablement (TPD) and / or Critical Illness (CI), provide long term protection and cover for significant costs like mortgage repayments or extra-ordinary medical expenses.

Other unexpected expenses could include things like accommodation, grief support, child support, overseas assistance, bed confinement, family support, or home care. All these and more are included in our Care Support Package which is provided at no extra cost on all lump sum covers as part of Integrity’s Here For You product.

The total income replaced will not be 100%. If your client becomes permanently disabled or critically ill, income insurance may not be enough.

And yet many Australians use 100% of their income each month. So how do you cover all the expenses of managing a sickness, accident or illness that potentially impacts a client’s financial situation?

Critical Illness Cover offers a lump sum payment to manage medical expenses if your client is diagnosed with a specified medical condition which may have an impact on their ability to meet their financial commitments. Together, Income Insurance Cover combined with Critical Illness Cover can provide support to clients financially to cover both household costs, as well as medical expenses.

Higher levels of TPD cover may need to be considered, to help financially support clients if they suffer a significant life-changing illness, accident or injury. Put another way, if your client is unlikely to ever work again, TPD is an option to ensure significant and ongoing medical costs are taken care of as well as any home modification adjustments needed to adapt to their ‘new normal’.

Please note: This information has been prepared without considering your personal objectives, financial situation or needs. Before acting on it, please consider its appropriateness to your circumstances.

Advances in medicine have meant that people living with HIV (PLHIV) have a life expectancy that is approaching the same as the general population¹. In fact, PLHIV who are taking and adhering to antiretroviral therapy (ART) cannot sexually transmit the virus to others².

Furthermore, with increased education and the introduction of the drug Pre-Exposure Prophylaxis (PrEP), HIV in Australia continues to decline³. Despite the facts, there is still a lot of disproportionate fear in the community which often creates stigma against those with HIV. This can lead to further health issues for PLHIV as well as a reluctance to seek treatment, which further complicates eradicating the transmission of the disease⁴. Similarly, Hep C also elicits a response that hasn’t kept pace with medical treatments and advancements⁵.

Below are some common questions we get from Advisers and their clients with Integrity’s position based on the most current research and thinking.

Q: If a medical practitioner needs to be tested for HIV or Hep C, would they be eligible for Income Insurance benefits, as they would be unable to work for up to 6 months, right?

A: The window period for HIV is now 18-45 days with some very, very rare cases taking up to 6 months to show up, so it’s very unlikely they would need to be away from work for an extended period of time. Additionally, the current guidelines⁶ don’t require a medical practitioner to cease practicing while they are waiting on test results unless there is a very large chance that they know they were exposed to someone who is a carrier for an infectious virus.

For Hep C, a special kind of blood test called a nucleic acid test (NAT) that detects HCV RNA (also called a PCR test) can tell if a person is infected within 1–2 weeks of exposure⁷.  

Q: What if the medical practitioner was advised in an official capacity (by their employer or official Association) that they’re not permitted to work, would we pay a monthly benefit then?

A: Generally, yes. If a medical practitioner is compelled not to work in an official capacity, then we would consider paying a monthly Income Insurance benefit.

Q: If they do end up having HIV or HEP C, doesn’t this mean they won’t be able to work? And therefore, would we pay Income Insurance benefits?

A: Contracting HIV or Hep C in Australia in 2021 is not a death sentence. Medical practitioners living with HIV or Hep C are permitted to continue performing the duties of their usual occupation as long as they are under the care of another doctor and following the prescribed treatment and guidelines. Additionally, due to privacy legislation associations such as Royal Australasian College of Surgeons (RACS) and Australian Health Practitioners Regulation Agency (AHPRA) are not even allowed to ask if a person is HIV/Hep positive as all. Medical practitioners are required to follow universal precautions to prevent the transmission of HIV (regardless of their status).

HIV or AIDS?

“HIV (human immunodeficiency virus) is a virus that attacks cells that help the body fight infection, making a person more vulnerable to other infections and diseases. It is spread by contact with certain bodily fluids of a person with HIV, most commonly during unprotected sex (sex without a condom or HIV medicine to prevent or treat HIV), or through sharing injection drug equipment. If left untreated, HIV can lead to the disease AIDS (acquired immunodeficiency syndrome). The human body can’t get rid of HIV and no effective HIV cure exists. So, once you have HIV, you have it for life. However, by taking HIV medicine (called antiretroviral therapy or ART), people with HIV can live long and healthy lives and prevent transmitting HIV to their sexual partners. In addition, there are effective methods to prevent getting HIV through sex or drug use, including pre-exposure prophylaxis (PrEP) and post-exposure prophylaxis (PEP). First identified in 1981, HIV is the cause of one of humanity’s deadliest and most persistent epidemics.”

“AIDS is the late stage of HIV infection that occurs when the body’s immune system is badly damaged because of the virus. In [Australia], most people with HIV do not develop AIDS because taking HIV medicine every day as prescribed stops the progression of the disease. A person with HIV is considered to have progressed to AIDS when: the number of their CD4 cells falls below 200 cells per cubic millimeter of blood (200 cells/mm3). (In someone with a healthy immune system, CD4 counts are between 500 and 1,600 cells/mm3.) OR they develop one or more opportunistic infections regardless of their CD4 count. Without HIV medicine, people with AIDS typically survive about 3 years. Once someone has a dangerous opportunistic illness, life expectancy without treatment falls to about 1 year. HIV medicine can still help people at this stage of HIV infection, and it can even be lifesaving. But people who start ART soon after they get HIV experience more benefits—that’s why HIV testing is so important.” ⁸

References.

1. https://www.nih.gov/news-events/news-releases/science-clear-hiv-undetectable-equals-untransmittable
2. https://medicalxpress.com/news/2020-11-hiv-australia-declined-years.html
3. https://napwha.org.au/wp-content/uploads/2019/04/HIV-and-Ageing-in-Australia-New-Frontier-April19.pdf
4. https://www.acon.org.au/wp-content/uploads/2020/11/HIV-Stigma-Paper_v8.pdf
5. https://www.healthline.com/health/hepatitis-c/can-it-be-cured
6. https://www1.health.gov.au/internet/main/publishing.nsf/Content/cda-cdna-bloodborne.htm
7. https://www.cdc.gov/hepatitis/hcv/cfaq.htm

https://www.hiv.gov/hiv-basics/overview/about-hiv-and-aids/what-are-hiv-and-aids

The latest Adviser Ratings survey has been released and it’s not great news for some large, established insurers. The 2020 survey shows that Advisers are deeply unhappy with the service levels and support they’re receiving. This continues to trend downwards from 2019… despite lots of feedback from the industry. The message from these large, established insurers to advisers is pretty clear. If it were a romantic relationship they are saying “We’re just not that into you.”   

Time to break-up?

Why stay trapped in an unhappy relationship when you have choice? Perhaps it is time to break up. Integrity Life brings no baggage to a new relationship. We are digitally enabled and legacy free. We are very proud to be on the podium and ranked second in the industry for adviser advocacy in the latest Adviser Ratings Survey for:

• Ease in underwriting
• Platform functionality
• Insurer competitiveness
• Adviser support and
• Overall NPS (pictured).

In addition to that, we got the highest rating on the charts for both ‘New Adviser Support’ and ‘Easy to understand documentation’ which are two areas we know are important to Advisers.

As the ‘new kid on the block’ we’re really happy with these results and it’s an achievement we couldn’t have made without the support and feedback from Advisers. We have always believed that listening, learning and then acting on Adviser feedback would be the secret to success, so to have this validated by the largest industry survey of its kind is absolutely wonderful!  

On behalf of Integrity, I would like to thank all the Advisers who have taken the time to provide their feedback through the Adviser Ratings survey. I hope that over the last 2+ years, Integrity has demonstrated a commitment to co-creating the kinds of product and service models that support Advisers in the ways they need to deliver the best outcomes for their clients.  

What your business needs is more of you. So, let’s free up your time.

Our focus for 2021 is to continue to drive efficiency in how we do business and how we work with Advisers, partners and their clients. It’s not just so that you’re not spending time ‘dealing with us’, we also want to support you in having easier client interactions, simplified compliance, and help you manage renewals. We believe that’s what Advisers need.

Maybe it’s time for you to see other people?

We would love to get to know you better and you should know, we’ve been working hard on ourselves. So, if you haven’t had a look at Integrity for a while there have been some big improvements you may not be across.

One of our most recent product updates included enhancements and changes that Advisers requested, with more to follow later in the year. Integrity’s retail products are now more flexible and easier to compare and with additional included value and features. Plus, all this was delivered without any changes to pricing (something Advisers also asked for!) You can read more about this significant update here.

There have also been a lot of positive changes to improve the application and underwriting process – making it even smoother. Examples include the new paramedical provider panel and Application Concierge – which is speeding up the applications with great initial results.

Got an idea or feedback?

We would love to hear from you. Integrity is committed to being the best ‘partner for life’ and that starts with listening. Please get in contact via this form or pick up the phone and we can arrange a time to chat.

We’re looking forward to delivering even better results with your support – and of course, your invaluable feedback.

If you would like to learn more about what else we’re up to, I invite you to see how Integrity is the perfect partner – for life!