Under the current Royal Commission, Direct Life Insurance policies have come under scrutiny for poor claims outcomes, and high cancellation rates.
Purchased directly from an insurer, as opposed to buying through a financial adviser, Direct Life Insurance is obtained with minimal provision of individual medical information, and there is minimal underwriting, if any at all.
Yes- you have to ask yourself ‘Who would buy a car without checking under the hood?’ It’s a worrying practice.
Along with some Wolf-of-Wall Street selling techniques, the Pre-existing Conditions Clause has become a distinctively apparent clause for concern. Here’s why;

Pre-existing Conditions
If there is an ‘automatic acceptance’, and you provide no detailed medical information to obtain your insurance, then it is highly likely that anything considered a ‘pre-existing condition’ will not be covered. It’s as simple as that.
The evidence at the Commission has shown the extremely negative consequences of the direct insurance channel, and highlights the valuable contribution a financial adviser can make when ensuring that individuals are getting the right insurance for their own individual circumstances.

Case Study
One situation identified by the Royal Commission is mind-blowing, and grossly inappropriate.
In this instance, an insurer sold a policy to a man with an intellectual disability.
An internal email chain that was distributed within the Insurance Company’s Sale’s team highlighted the insurer’s intention to sell a particular product, despite the extensive negative impact it would have on the life of clients, especially someone with a pre-existing intellectual disability.
The email shows that there is $150 on offer as an incentive to sign up as many ‘lives’ as possible.

"Target is 400 lives by lunchtime."
"Everyone aiming for seven lives over the first two sessions — 3.5 lives per session, easy peasy — and we'll smash 400 lives to lock-in the incentive money for the last part of the day."
"Also the draw for Tuesday is coming up, let's smash it out folks and lock this cash money in."

Sorry to burst this giant bubble, but yes, a free gift voucher, free TV subscription and other gimmicks should ring alarm bells.
Do your research. There may be alternative motives that do not have your best interests at heart.
It’s a sad practice. One that Partners In Planning are determined to push aside.
Spending 20 minutes to consider your life insurance choices now, will avoid any confusion later. In our opinion, it’s the greatest gift you can give to both yourself and your family.
Find out more about the Life Insurance policy that is right for you by contacting Partners In Planning. There’s no better time.

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This article is published by Simon sharing information regarding Investment Advisor Melbourne