Direct life insurance sales down in 2014

Plan For Life’s Direct Life Insurance Report shows year-on-year premium sales in the direct life insurance channel declined by 3.6 per cent in 2014.

This was compared to the positive growth the channel experienced for the previous five years.

“The total Australian life insurance industry premium sales, including lump sum and income protection products, totalled $2,043 million as at the end of December 2014, compared to $2,080 million at December 2013,” a statement from Plan For Life said.

“Of this, $538 million was via the direct channel, compared to $558 million December 2013.”

Plan For Life also found that term life, TPD and trauma business continued to dominate sales in the direct risk market, collectively accounting for 51 per cent of sales over the past year.

In terms of in-force direct lump sum risk business, the research house found the telephone channel accounts for 47.9 per cent of the market, down from 55.7 per cent.

Comparing the direct market to the retail channel, the research house also found direct channel average premiums have remained higher than those for the retail channel.

“Specifically life insurance has seen a small increase (from 14 per cent to 17 per cent),” the statement said.

“Trauma average prices have reversed the increase seen in 2014 with the gap back at 10 per cent, the same as 2013. Income protection at 28 per cent remains the same as 2014.”