There are areas in which the life industry could work with the National Disability Insurance Scheme (NDIS), says NAB EGM Retail Wealth Products David Hackett. But he admits such participation would not be without its risks.

“The life industry and the Government need to work together, and we can play a role,” he told the Financial Services Council life conference in Sydney last week.

“But the concern for the life industry is [that] people will cancel their cover because they think they are covered by the NDIS.”

Mr Hackett wants to see more education on the scheme and the different role of disability insurance.

“If we don’t end any confusion it could reduce the take-up of life insurance, and that will widen the insurance gap,” he said. “There is potentially also reputational risk for the insurance industry if there is consumer confusion.”

Mr Hackett says while questions have been raised about the scheme’s long-term viability, this is where the life insurance industry can play a role, helping to spread costs.

“There is a lot of upside for the industry and collaboration is appealing. We see the NDIS and life industry complementing each other.”

He says working together could bring scale advantages for both sides.