Life insurers remain under the spotlight, with the Australian Prudential Regulation Authority (APRA) questioning the industry’s sustainability.

Deputy Chairman Ian Laughlin says insurers’ problems are self-inflicted.

Addressing least week’s Financial Services Council conference, he raised doubts over underwriting standards and claims management, and questioned whether covering consumers without medicals was wise.

APRA has previously criticised group life insurers, but now the wider industry appears to be in the cross-hairs.

Mr Laughlin says decades-old, complex policy definitions should be reconsidered if insurers are to improve profitability.

He says some advisers who have pursued awards for products and services might not have worked in the industry’s best interests.

Changes to the life industry can take a long time to kick in, but Mr Laughlin says when APRA put pressure on group life insurers to reform pricing, it achieved results in years rather than decades. Price rises of 100% or more have not been uncommon.

Meanwhile, the Australian Securities and Investments Commission is putting pressure on advisers.

Deputy Chairman Peter Kell says the regulator will publish a report next month on life sales through banks. He says commissions are a problem, and the industry has done little to tackle it.

Life commissions are currently excluded from conflicted remuneration rules under the Future of Financial Advice legislation. But Labor and the Greens are expected to table a motion to again debate changes to the legislation when the Senate resumes sitting from August 26.