How you can get an appropriate policy and advice for your situation

Direct life insurance can 'appear to be' the saving grace to many of our worries. It's cheap, easy to apply for and can be done in no time at all – which makes it the clear choice for many time-poor consumers who want to do the best they can with what they have.

While seeking the advice of a financial adviser might seem like money and time that could be saved, the benefits of seeking out professional advice when it comes to life insurance far outweigh the cost savings.

Direct life insurance isn't always the best option, for a number of reasons, three of which we've outlined for you below.

1. No Personal Advice:
How do you know that the policy you're signing up for is an appropriate policy for you? When you purchase direct from the insurance company, chances are you're not acting on any external advice from a financial professional.
This can definitely be detrimental to the security you think you're getting. A survey done in 2016[1] shows that more people than ever are purchasing life insurance direct and that 69.86% of all people surveyed receive no advice whatsoever when it comes to their life insurance.
The pitfalls of this could mean that you're purchasing an inappropriate policy for your situation, or one that doesn't cover any pre-existing conditions that you might have. After all, you can only go by what the company has advertised in their TV commercial, and usually there's much more to it than that. A financial adviser can help you find a policy that's tailored to your financial situation.

2.  Unclear Terms & Policies:
Once you've found the 'perfect' life insurance policy for you, it's time for all the paperwork, red tape and terms and conditions. For the average person, it can be easy to skim these or be confused by all of the jargon and terminology used.
Sometimes, direct life insurance policies are intentionally confusing, like in this case[2] where a life insurance policy was using outdated terminology for medical conditions and procedures – something that most consumers wouldn't know, but that a professional would spot.
Having a financial professional go through the terms and conditions of the policies with you will make you feel better about your decision and will mean you know exactly what you can claim and after how long (as some policies have waiting periods). There would be nothing worse than going to make a claim and finding out that you're not actually covered for that particular illness or injury.

3. No Assistance when making a Claim:
The moment you hope will never happen, even though you're prepared for it, is needing to claim on your policy. The mountain of paperwork is not something you ever want to do, especially if you're in a position where you just want to rest and recover. Nor do you want to put all that stress onto your loved ones in what is most likely a difficult time.
Obtaining life insurance through a financial adviser means that if ever you need to claim on the policy, you have the advantage of a professional who knows the process and is familiar with your claim.
On top of that, an ASIC review[3] found that there was a higher rate of denial of claims that came from consumers with no financial advice, as opposed to those with advisers or group insurance policies.
For something as important as life insurance to take care of yourself or your family, it really is the best course to seek the advice of a financial professional to help you get an appropriate policy for your situation. Not to mention, then you also have a professional to lean on in your time of need who can take the hassle and confusion out of processing a claim if ever you have to make one. Make getting life insurance as simple and easy as possible with the help of someone in the know.


Direct life insurance can seem like the best thing that we can do for ourselves, our families and our loved ones, but sometimes going direct isn't the best thing you can do. Disadvantages like no personal advice, unclear policies and no assistance when it comes to making a claim, make it a much better idea to seek out a financial adviser to help you purchase a life insurance policy that's appropriate for you and your situation.

Want more information or help with purchasing Life Insurance?

If you'd like more specific advice to compare direct life insurance against a personally tailored life insurance policy, please email Murray Nankivell Financial Planning on or call us on 08 8762 1544.

About Murray Nankivell Financial Planning
Murray Nankivell Financial Planning is licensed through the Lonsdale Financial Group (AFSL 246934), and Tony Bedworth (Authorised Representative of Lonsdale) is based at Naracoorte, providing a full range of financial planning services tailored to your personal circumstances and situation.
Being licensed through the Lonsdale Financial Group allows Murray Nankivell Financial Planning access to support and resources of a large leading provider of quality financial services in Australia.
This support allows us to remain informed and up to date with the latest research, advice and legislative changes in the financial planning industry. Combined with our extensive local knowledge, we are able to provide a winning formula for you.

About the Author - Tony Bedworth

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