The reinsurer stated that it will not seek new clients in the life insurance segment until the market demonstrates a clear shift towards sustainable product design. However, Swiss Re will continue to support its existing life insurance partners, ensuring that there is no impact on advisers writing business with insurers.
Paul Murray, CEO of Life and Health Reinsurance at Swiss Re, emphasized the need for the industry to balance protection with long-term sustainability to avoid increased premiums, which can contribute to making insurance unaffordable. The company plans to work with existing retail clients, the broader industry, and regulators to redesign products that reflect evolving societal needs and provide consumers with greater certainty for future planning.
This move has prompted the Australian Prudential Regulation Authority (APRA) to engage actively with the life insurance industry to address challenges facing the TPD product line. APRA acknowledges the complexity being experienced with TPD, including those related to mental health claims, and expects the industry to take proactive leadership to improve the sustainability of TPD and create better customer outcomes.
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