The Financial Planning Association (FPA) has called for a standard to describe product features in life insurance documents.

Its submission to the Parliamentary Joint Committee on Corporations and Financial Services’ life insurance inquiry says it is difficult for consumers to compare products due to the complexity of documentation.

“At present, insurers define product features, definitions and standard terms differently,” the submission says. “They compete on overly complex policy definitions, creating knowledge asymmetry for consumers of their products and all but the most skilled intermediaries.”

The FPA says different formats and orders of sections make it hard for consumers to compare. As a result, they think life insurance companies are difficult to deal with, leading to falling coverage.

The association also wants standard medical client forms, which are submitted to doctors on behalf of insurers.

“Each insurance company has its own medical questionnaire, so where a consumer is applying for multiple life insurance products from multiple providers, a doctor may need to complete a number of different medical reports just for the purposes of underwriting.

“This again adds significantly to the complexity and cost of obtaining insurance cover.”