We should expect to see closer collaboration between life insurers and superannuation fund trustees on group life cover offered to fund members. Group life premium pricing has been a vexed issue for some time and it remains to be seen whether premiums for fund members might increase in coming years.
APRA's Prudential Practice Guide LPG270 - Group Insurance Arrangements was released in October 2014. In a letter to Superannuation Fund trustees on 18 May, APRA requests life insurers to consider no fewer than 30 issues relevant to their management of group life insurance and the associated risk oversight and business implications.Superannuation fund trustees may infer from this that their group life providers will continue to raise the bar when renewing or extending support to fund members. Trustees may need to consider the ability of their systems, processes and resources to provide reporting and data to insurers. Insurers may require better data than in the past enable them to adequately price the risks they are accepting for the membership base covered.Trustees may need to be alert to changed eligibility, automatic acceptance limits, exclusions and benefit definitions affecting their members.