Suncorp Life has called for more transparency in insurance product disclosure documents.

In a submission on the Financial System Inquiry’s interim report, CEO Geoff Summerhayes says the industry must focus on simplicity and services to consumers.

“This includes development of a simplified life, trauma, total and permanent disability and income protection product assessment questionnaire that could be accessed by consumers through the Australian Securities and Investments Commission MoneySmart website.

“I also support a move towards general categorisation of products.”

Mr Summerhayes says the interim report has raised concerns about legacy products and the need for a regulatory framework.

“I support this and recommend Treasury should issue a discussion paper on options for streamlining and simplifying the life insurance product rationalisation mechanism, including consideration of tax implications.”

Suncorp Life has also questioned the role of appointed actuaries in life insurance companies.

“The [position] has not kept pace with changing business structures and is too compliance-focused rather than being strategic,” Mr Summerhayes says in the submission.

“Corporate executive structures have evolved considerably, with new roles such as chief risk officer now in place and a huge step up in governance and risk management practices.”

He says changes to life insurers’ corporate structures have added to the complexity and demands of the actuary’s role.

“The appointed actuary now sits as a first, second and third line of defence,” Mr Summerhayes says. “There is an inherent challenge between the interests of policyholders and commercial priorities.”

The company also calls for action on the issue of underinsurance.

“There should be consideration of public policy changes to improve take-up of private life insurance cover, including income, private personal injury and sickness cover.

“Analysis of the net financial impact of introducing appropriate financial tax incentives and disincentives… should be explored.”

Mr Summerhayes says the private health insurance industry benefits from a rebate system that “incentivises” take-up.