Suncorp subsidiary Asteron has rejigged its life insurance underwriting procedures to mitigate the spillover effects of a Federal Government decision to reduce limits on concessional contributions to superannuation.

Asteron says the decision has encouraged many Australians to cancel life cover provided through super in order to maximise their retirement contributions.

It says many advisers are moving their clients’ insurance outside of super due to cost concerns driven by the global downturn, a large number of consumers approaching retirement and the reduction in super concessional contribution limits.

The reduction of concessional contributions to $50,000 a year for people aged over 50 and $25,000 for those under 50 means investors are forced to choose between funding life cover through super, or maximising their super contributions.

“In many cases, that means life insurance is being cancelled,” Asteron GM Jordan Hawke said.

The insurer has responded by waiving the common requirement for customers to undergo repeat underwriting – a process that can often ramp up the cost due to the policyholder’s advanced age.

Clients will also keep their existing premium.