Investors value life insurance assets lower and the industry needs to boost confidence in the sector, TAL MD Jim Minto says.

“Markets value our assets lower and it is very common for life companies to trade at discounts,” he told the Financial Services Council conference on the Gold Coast earlier this month.

“If we are to continue to pay claims, we need to restore investor confidence in our [life] companies.”

OnePath Acting MD Gavin Pearce says providers of capital will go where they can get the best returns.

“Investors look at capital returns but in life insurance the cost of distribution draws on the capital,” he told the conference.

“Unless we change investors’ attitudes to life companies, we will fall down paying the claims.”

Mr Pearce says the attitude to ANZ, OnePath’s parent, has changed and there is more confidence in the organisation from investors, making capital-raisings easier.

AIA Australia CEO Peter Crewe says Hong Kong investors like his Asian parent company.

“We are in a fortunate position of being seen as independent and the share price has steadily been rising,” he told the conference.

Mr Crewe says investor perception of a life company is vital if it is to attract capital.

“It is about investor confidence and that is crucial,” he said. “People want us to keep paying the claims.”