Australians are “panic buying” life insurance products amid growing concerns about the COVID-19 pandemic, according to research by GlobalData.
The data and analytics company found that 88% of Australian wealth managers have seen increased demand for life insurance among high-net-worth investors due to the virus.
This rise in demand is higher than in any of the other 19 countries studied, and came prior to Victoria declaring a “state of disaster” after a spike in coronavirus cases.
GlobalData also found that 83% of Australians were “quite concerned” or “extremely concerned” about the outbreak of COVID-19 earlier this month, with another 12.1% “slightly concerned”.
In addition, 61.5% of Australians believed that the situation will get “a bit” or “a lot worse” over the next month, compared to just 28.7% who said the same at the beginning of May.
“Panic buying does not end with food,” explained Heike van den Hoevel, senior wealth management analyst at GlobalData
“In the face of growing concerns surrounding infections, Australian high-net-worth investors are looking for ways to care for their families.”
The research involved surveying wealth managers across Australia, Belgium, Canada, China, Denmark, France, Germany, Hong Kong, India, Indonesia, Norway, Singapore, South Africa, Sweden, Switzerland, Taiwan, the UAE, the UK and US.
The findings also suggest that trust in life insurers has deteriorated, with 96% of wealth managers agreeing that customers have lost confidence in the industry as a result of the COVID-19 pandemic.
“This is a worrying statistic – the reputation of insurers has taken a battering amidst COVID-19 and high-net-worth investors will be more likely to buy insurance products via a third party,” van den Hoevel said.
“The crisis has been a double-edged sword – COVID-19 is driving demand but has also had a negative impact on the insurance providers’ image.”
Author: Chris Seekings
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