Zurich Life Australia has reduced the premiums on its death, trauma and permanent disability products for older consumers.

Premiums for older consumers have traditionally increased as they age due to higher mortality rates and this is leading to them cancelling policies or reducing their cover levels.

Zurich Life CEO Colin Morgan says the cost of cover has fallen in recent years but there has been a need to address the problem of premiums increasing as people age.

“The fact that people feel they can no longer afford cover at the time they are most likely to need it is worrying, and has contributed to Australia’s underinsurance problem,” he said.

“Our new pricing structure will make cover more affordable for older age groups, which we hope will encourage more Australians to keep or take out life protection.”

Mr Morgan says the fact consumers are working longer and carrying larger debts in later life is another reason to encourage consumers to keep their cover.

“A decade ago it was still the norm for people to be paying out their mortgage in their early 50s,” Mr Morgan said.

“Fresh research shows that today people are carrying mortgages all the way up to retirement, in many cases needing their superannuation to pay off the last remnants of their home loans.”

The new pricing is already in effect.