In short

• Despite a dramatic improvement to the insurance sector’s performance over the past decade, the public’s general perception is that there is a lot more work to do.
• Media coverage of insurance failures, coupled with a lack of coverage of successes and advancements, creates a serious challenge for the reputation of the sector.
• Insurers are focusing on upskilling within their own organisations, as well as offering public education campaigns targeting myths and misperceptions, to begin to change the narrative.

Like clockwork, the minute a natural disaster occurs, the media begins reporting on home and contents insurance failures. If the event is in another country, that coverage might instead focus on travel insurers. And if numerous people die during or after the disaster, life insurers are also likely to be placed under the microscope.

A level of scrutiny can be a positive thing — it ensures constant improvement and a pursuit of excellence across the sector. At the same time, however, it can have a negative impact by ignoring advances in the industry and creating or further reinforcing misconceptions among customers.

Some of these misconceptions seem as old as insurance itself. In the field of life insurance, says Jane Barron, marketing and digital manager at Pinnacle Life in New Zealand, some of these include: a belief that customers will get their premiums back if they don’t claim; that a health loading is a personal judgement indicating the insurance company does not wish to provide cover; and the suspicion that life insurers won’t pay out.

Misconceptions also exist in travel insurance. Todd Nelson, CEO of Cover-More Australia, lists some of the most problematic myths:

• Travel insurers hide nasty surprises in the fine print.
• Travel insurance doesn’t provide cover for many medical conditions.
• Customers won’t be covered if they have a drink while on holiday.
• All policies are the same.
• Travel insurers won’t approve claims.

“While we work actively to debunk these myths, including publishing content on our website and social platforms, it is difficult to get good traction when online channels and platforms and the mainstream media are much more likely to focus on negative stories and declined claims,” says Nelson.

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