New figures from life insurer NobleOak reveal that the number of Chartered Accountants Australia and New Zealand members who opt for income protection * (IP) when taking out one of its life insurance policies has halved since 2020.

That’s despite a recent whitepaper, commissioned by NobleOak, that surveyed more than 1000 Australians and found that income protection (also known as disability income insurance) is the type of insurance Australians are most likely to purchase in the next five years.

IP pays a monthly amount to eligible policyholders who can’t work due to sickness or injury. It’s designed to help the person insured cover expenses, such as mortgage or rent payments, and everyday essentials.

“IP is about having peace of mind that, should something terrible happen, you’ll have one fewer thing to worry about.”

According to NobleOak CEO Anthony Brown, one reason for the reduced numbers could be regulatory changes to IP across the industry that were introduced by the Australian Prudential Regulation Authority in 2021.

“Changes were brought in to deliver better outcomes for customers,” he tells Acuity. “They make IP more sustainable, manage the risks and ensure benefits are adequate.

“It’s been a tough few years for Australian families. Budgets are tight and cost-of-living concerns high, so it’s completely understandable that people are looking for ways to cut back. It is a concern, however, that foregoing income protection could leave people in serious financial stress if they’re suddenly unable to earn a living.”

Value for money

For Brown, it’s important that families get the right cover for their circumstances. To do so, as their situation changes, they may need to review the level of benefits or the period of time over which they are payable.

Choosing the right plan

Shopping around for the right policy could be critical, as there can be variations between them. “For example, some build in a degree of inflation protection by adjusting benefits when prices rise. They’ll also cover additional expenses that help you get back to work, such as rehabilitation,” he reveals.

This year, Brown has seen an encouraging increase in CA  ANZ members taking up IP. He’s still concerned, however, that many individuals may be unprotected. “IP is about having peace of mind that, should something terrible happen, you’ll have one fewer thing to worry about,” he says. “It’s worth taking the time to consider all the implications before deciding the best option for you and your family.”

Find out more

Fully underwritten income protection insurance is available under NobleOak’s Premium Life Direct product. NobleOak also offers life cover, trauma cover and total and permanent disability insurance. Find out about benefits available to Australian CA  ANZ members here or  call 1300 108 490.

_{*Data based on NobleOak report on Australian CA  ANZ members and NobleOak partnership. Numbers were run on June 22, 2023. NobleOak whitepaper available at
nobleoak.com.au/tools-guides/whitepapers Important information: Cover available to Australian residents only. The target market determination for NobleOak’s Premium Life Direct insurance is available on site. NobleOak Life Limited ABN 85 087 648 708 AFSL No. 247302 issues the products. This information is of a general nature only and does not take into consideration your objectives, financial situation or needs. Always consider the product disclosure statement (PDS), available at nobleoak.com.au to see if the product is right for you.}