Research released by the Association of Financial Advisers (AFA) has found consumers don’t want to pay for advice on life insurance.

The research by Coredata has found 56% of those surveyed would not pay an upfront fee for financial advice if it was not part of their corporate superannuation fund fees.

Those superannuation fund members who do receive financial advice on insurance (32.6%) prefer to pay for it through a commission from the product provider to the adviser.

AFA CEO Richard Klipin says the findings show that people who use a financial adviser for their life insurance needs are well informed about the type and amount of cover they hold.

“Disturbingly, many would not pay for it if commissions are abolished,” he said.

The research also found two in five respondents to the survey didn’t list fees as their preferred payment option for advice.

“This implies that some of the few people actually receiving life insurance advice in today’s environment would exit the market if forced to pay a fee for service,” Mr Klipin said.

The survey was commissioned before the Future of Financial Advice reform proposals were announced last week.

The AFA has predicted banning commissions will impact consumers as the underinsurance problem will rise dramatically.

“Fewer would get advice and even fewer would have life insurance,” he said.

According to the research, 52% of respondents said they had life insurance, but two in five said they would never insure their lives.

Those that did have life insurance were underinsured, with the average cover being five times earnings.

This is half of what actuarial firm Rice Warner has recommended for the minimum level of cover.