Research reveals Aussies unaware of insurance risks for older Australians

• New research from Allianz reveals that over half of Australians acknowledge they are unaware of the specific insurance risks faced by older Australians¹.
• Furthermore, 65 per cent of surveyed Australians are unsure of how to support a loved one who has experienced elder abuse whilst navigating an insurance claim².
• Allianz has partnered with the National Ageing Research Institute (NARI) to conduct research to identify the issues encountered by older people during the insurance claims process, and to help develop solutions to prevent financial abuse occurring.
• In alignment with the Insurance Council of Australia’s (ICA) newly unveiled industry Action Plan (PDF 1 MB), Allianz is actively working to bridge this significant knowledge gap to better support vulnerable groups, such as older Australians, within the insurance industry.

Over the past decade there has been a growing awareness around different types of elder abuse. New research from Allianz Australia reveals a staggering 84 per cent of surveyed Australians⁴ are aware that elder abuse can occur in the form of financial abuse. Awareness is driven through news reports (58 per cent) or second-hand accounts (41 per cent). Despite this awareness, 65 per cent of surveyed Australians acknowledge they’re unsure of how to assist a loved one encountering elder abuse related to an insurance claim.

While awareness has increased, the specific risks older Australians face regarding insurance policies remain largely unknown, with over half of Australians admitting they are unaware of these risks³. 

With the increased frequency and severity of weather events, the need to protect and support older Australians is more important than ever. Allianz has partnered with the National Ageing Research Institute (NARI) to conduct research to identify the issues encountered by older people during the insurance claims process, and to help develop solutions to prevent abuse occurring.

“It is concerning to see the ways in which older Australians can experience financial abuse, including from an insurance perspective. As Australia’s older population continues to grow, addressing elder abuse within services like insurance becomes even more critical. We hope that the research and report we developed with Allianz is the first step of many to understanding how elder abuse and mistreatment can present in different context and ensuring older Australians are treated with dignity and have access to safe, supportive services,” said Dr. Marina Cavuoto, Senior Research Fellow, NARI.

The NARI report, titled The risks facing older Australians with insurance, outlines the most common insurance risks experienced by older Australians including insufficient insurance coverage, challenges with meeting home maintenance obligations in insurance policies, vulnerability to fraudulent builders and claims management companies, risks with cash settlements and heightened susceptibility to scams following natural disasters. These findings echo the ICA’s call to action for enhancements to the General Insurance Code of Practice in addressing the needs of vulnerable groups.

Allianz claims data indicates that the most common incidents causing Australians over 65 to make an insurance claim include minor property damage (17 per cent), storms (16 per cent), and fire (16 per cent).

The report details many examples of scams, particularly following natural disasters, where older Australians are approached at their homes by people claiming to come from previous disasters, offering their help. In some cases, unscrupulous trades people offer to make emergency repairs and either do subpar work, fail to show up or never complete the repairs after being paid.

Claims management companies target vulnerable people, promising to get a better settlement or make the process smoother, but often provide no real assistance, leaving the home owner out of pocket and with a bigger financial burden.

The report details a recent incident involving Jack⁵, a 91-year-old resident of a small country town affected by a bushfire, which caused damage to part of his property. Jack, who has mild memory problems, was approached by a woman who knocked on his door offering assistance. She claimed to represent a service familiar with handling insurance claims in such situations and mentioned her recent work in another bushfire-affected town, helping older individuals like Jack for a small fee. Trusting her intentions, Jack agreed to her help.

The service did engage with the insurance company to file and resolve the claim. However, they pressured Jack into accepting a cash settlement instead of opting for property repairs. From this settlement, they deducted a 25% service fee. Although Jack was satisfied with the outcome, there is uncertainty about whether the remaining funds are adequate for the necessary repairs and if Jack has been able to find a tradesperson to assist him.

Data from the Australians surveyed in the Allianz research highlights that there is an expectation that insurance companies should take proactive steps to better support older customers. Suggestions include simplifying information in insurance policies (58 per cent), training staff to better assist older policy holders (56 per cent), and establishing dedicated teams to manage claims for customers who need additional support (49 per cent).

These findings support the work underway to update the General Insurance Code of Practice, including strengthened protections to improve customers’ claims experience and maturing industry capability in supporting customers experiencing vulnerability. Allianz supports this work and has already implemented safeguards to better support older Australians during the claims process, such as bespoke training for Allianz employees on the risks of cash settlements and elder abuse, referrals to support services, case management support via Allianz’s High Care team, and on-the-ground support following disasters, including welfare checks. This initiative includes making outbound phone calls to customers over the age of 75 to check on their wellbeing, provide an opportunity for customers to inquire about the claims process and assist them in proactively lodging a claim to ensure they receive their entitlements and support.

With Ex-Tropical Cyclone Alfred recently impacting Southeast Queensland, Allianz proactively reached out to customers over the age of 75 as well as set up a dedicated helpline for these customers where they could make a claim, book a loss adjustor and get help securing temporary accommodation, if required.

“At Allianz, we recognise the urgent need to address the financial abuse of older Australians, as it relates to insurance. We have worked closely with the team at NARI to develop this report to better understand how we can support older Australians in the insurance claim process. The report has highlighted risks older Australians are more susceptible to and has provided practical insights to enable Allianz to better support customers. We hope that our work in the space will raise awareness and empower individuals and their loved ones to better safeguard their families and navigate the claims process with confidence,” said Matt Anderson, Head of Retail Property GI Claims at Allianz Australia.

• Make sure you have the right policy coverage in place. Contact your insurance company every year at the time of renewal to make sure that your property and contents are covered adequately.
• Keep your home repaired and maintained. As a home ages, it is more likely to need more frequent repairs and maintenance. Overlooking regular home maintenance may lead to problems with your property and could potentially affect future insurance claims.
• Contact your insurer directly to make a claim: If disaster or an accident strikes and you need to make a claim, it is important to contact your insurer directly. There are a number of scams or companies that may take advantage of you during your time of need.
• Protect yourself during the claims settlement process: If you decide to take a cash settlement, it is important you ensure the money goes into your account, rather than someone else’s, and you are prepared to arrange the repair process. However, given insurance companies are experts in managing repairs you may be better off requesting they manage the process for you. This ensures that everything is up to standard, making sure you stay covered in the long run.
• Seek help with managing your claim: It can be overwhelming managing a claim in the wake of a disaster or accident. Financial counsellors can help support you during the Claims process. You can find a financial counsellor in your local area through the National Association of Legal Centres or The National debt hotline.

1. 53 per cent of Australians are unaware of the risks facing older Australians when it comes to insurance
2. 65 per cent of Australians wouldn’t know how to support a loved one who has experienced elder abuse via an insurance claim
3. 53 per cent of Australians are unaware of the risks facing older Australians when it comes to insurance
4. The example scenario featuring ‘Jack’ included in this release represents an amalgamation of common abusive issues experienced by older people during a claims process