Advisers help improve financial literacy around life insurance, according to a new report from the Financial Planning Association (FPA) and Zurich Financial Services.

Their Life Insurance Literacy Index shows the average literacy score among people without financial advisers is 4.5 out of 10.

This rises to 6.7 among clients of financial advisers who discuss life insurance.

The report, prepared by CoreData, claims to be the first of its kind.

It shows most Australians hold some form of life insurance (59.9%), with most of these policies (62.7%) secured through super funds.

About 21% keep their super fund’s default cover, because they trust their fund or employer to know the correct level for them.

FPA CEO Mark Rantall says more work is needed to improve financial literacy, to create better-informed and protected consumers.

“The report is a tangible and significant reinforcement of the value of financial advice and financial advisers,” he said. “The area of life insurance, specifically the issue of mis-insurance of Australians, is a major concern for the FPA.

“Ensuring Australians are appropriately protected is of national importance and Zurich and the FPA are committed to supporting… members, so they can continue to educate clients about the benefits of insurance and the right products for their particular needs.”

Zurich GM Retail Life & Investments Philip Kewin says the index highlights an opportunity for advisers.

“Our report proves advisers are effectively educating customers about different types of insurance, including super-based life cover,” he said. “By teaching clients about what insurance products are right for them at different life stages, they are continuing to prove their value, but more importantly will turn more clients into advocates.”