Superannuation research and consultancy firm Chant West has issued a damning report on life insurance disclosure standards, calling for greater consistency across the super industry.

The firm’s Insurance in Superannuation report finds a wide variation in premium pricing and says it is almost impossible for people to compare life insurance products across different funds.

The report says that for the same member, the highest premium is almost 10 times greater than the lowest premium, rising to 20 times at age 60. It claims the cost of life insurance in some funds dwarves “all the other fees and costs put together”.

Chant West Principal Warren Chant says while insurance products are improving, “premiums, terms and conditions are still a dark art”.

“Quite frankly, that’s because it has suited some in the industry for it to be that way,” he said. “Most members wouldn’t have a clue whether the insurance premiums coming out of their account represent good value or not. And nor could they, because the level of disclosure in the whole area of insurance is so appalling.”

His report calls for an overhaul of insurance disclosure standards, including a requirement that funds show all premiums on the fund’s public website. It also calls for the disclosure of all premiums gross of tax and the separation of premiums from adviser commissions.

Other recommendations include the disclosure of the premium per $1000 of cover, as well as information that is based on the member’s current age. Additional administration or policy fees should also be illustrated alongside premium tables.