Partners Life have announced a few product changes effective 1 October. They wrote:
We are pleased to bring you some exciting new products, benefit enhancements and increased commission options. The enhancements to existing policy wordings are passed back to existing clients under our Guaranteed Upgrade of Future Benefits feature. Please remember that while benefit improvements are applied to existing clients, any claims events arising before the effective date are determined according to the policy wording before the enhancements are added.
We trust these enhancements will be of great value to you and your clients, if you have any questions please contact your Sales Manager.
You can find out more about their new commission options, which includes a return to upfront medical commission of 125% with a renewal commission of 7.5% - details here. They will now allow Mortgage Repayment Cover to be based on income, read more here. Some improvements have been made to Severe Trauma and Trauma Cover conditions which can be viewed here.
A tough definition of robo advice could be: “Can enable a compliant personalised advice recommendation to be made without the requirement for a human adviser to be responsible for the advice”. We aren't alone in choosing that definition. We think it is what MBIE has in mind when it writes about robo-advice licensing, because they view a law change as necessary to meet this definition.
On the other hand you may take the view that robo-advice is the involvement of technology at any point in a process which may result in a sale, whether that contains 'financial advice' as defined by law. We have some different terms for that - we call them 'adjacent' to the strict definition of robo-advice, here are some current examples to illustrate:
Adjacency 1: robo ‘nearly-advice’ – best example: LifeDirect, it is robo, but it is a sale without financial advice.
Adjacency 2: ‘nearly-robo’ advice – uses technology to make the adviser much more efficient at the actual advice process – we think Quotemonster, and QPR fit into this category - these are adviser tools.
Adjacency 3: ‘technology enhanced advice’. In this case the technology doesn’t play a role in working out the advice (it doesn’t capture requirements and help make recommendations) but it facilitates the process of doing that. Specialised examples include some kiosks and Suitebox.
Adjacency 4: 'robo-to-advice' which uses combinations of tools to help clients self-qualify, or complete aspects of the advice process themselves, to bring them better prepared into an advice-giving discussion with an adviser.
There is a lot of room for development of effective services in each of these areas. We are very interested in developing services for advisers in the last category.
Part seven in our series in building the best insurance report with the least wasted time.
Financial advice is fundamentally about solving a problem that the client has. So understanding what the customer wants, while being clear about what you can and cannot do fulfills two important goals:
The first is that it gets the advice on the right footing – being about the client. That’s good for sales, and also, not by accident, happens to be one of the critical steps to creating a recommendation compliant with our laws and regulations.
The second goal it meets is that by putting your services on show it both supports the whole idea of financial advice, and getting advice from you in particular. That all adds up to defining the engagement.
So that’s why the second step of the needs analysis on quotemonster.co.nz is all about defining client objectives.
If you are not sure about how to find this page it’s simple. At Quotemonster.co.nz hit the ‘get crunching’ button and put in basic information to enable you to do a quote, hit next. Then look at the top of the screen and find the ‘needs crunching’ button and click on that. You need to complete the scope and priorities page, click next and you are at objectives.
Clients can select up to four objectives. We have given you a drop-down list of the most common types of objectives that clients have for insurance-focused financial advice. You do not have to have as many as four objectives, of course. We do recommend that you choose at least one. Look through the objective list – familiarise yourself with the choices from ‘Get a reasonable package of insurance for my budget and circumstances’ to ‘ensure my family keep our home if I cannot work…’
The last box does not have the drop-down list but allows you to record an objective in your own words – or even better, the words the client used, those are the ones they will connect with emotionally, creating more emotional motivation for a good solution.
After that we suggest you are your client the questions in the list ‘What area would you like help with.’ Having worked with a number of advisers that have had legal disputes with clients we cannot tell you how helpful it is to check with them on these questions.
Now look at the drop down box. Notice that there are three possible answers. “Yes” and “No” and “Help me understand this”. This helps you to identify and address any financial literacy issues. Or put another way, if you are moving a bit fast and the client isn’t sure what you are talking about, look for those signs here. Explain how your service works and move on when the client is ready.
When you have completed the page click next to progress to the next stage – which will be financial details.
The next part in the series looks at the one-page approach to capturing basic financial information necessary to form an initial view on insurance recommendations.
Southern Cross have come under fire for not approving digital tomosynthesis, the latest technology in breast cancer screening. According to this article researchers say it can help detect the disease 40 per cent earlier using more detailed 3D images of breast tissue than a standard 2D mammogram.
Gen Re has this article on critical illness definition standardisation, for an Asian perspective. It includes some commentary on the UK experience as well. One gets the feeling that Gen Re is a supporter of standardisation, talking up the benefits of consumer confidence. That was supported by the UK's experience. However, the ability to vary 'above' standards would be a minimum, for me, otherwise, it squashes competition and experimentation.
You should talk with a financial adviser if you are 'stuck' on a money issue, that's a good place to start.
Most financial advisers deal with clients who are already wealthy, but a few do excellent plans to help people with high incomes, but who are in a mess - or stuck - somehow. If you are on a low income and you are struggling the best place to start is with a budget adviser, you can find one by searching online for a member of the New Zealand Federation of Budget Advisers, or visiting a citizens advice bureau.
You have some big goals and you think its worth planning.
It is always worth planning. Anything that takes more effort than checking if you have enough cash in your wallet right now probably deserves a plan. If you are saving for a house, planning on starting your own business, looking at retirement, that big goal up ahead whatever it is, is worth planning for. You will not know how useful the plan is until you sit down and write it. You can get a book and read some self-help stuff online, but a real human asking you hard questions and holding you accountable for a proper answer, that can create real change in your life - and that's what you want really isn't it?
Things just changed in a big way
Sometimes you aren't looking forward to a change, change just barged into your life: someone died, you get married, a child comes into your life earlier than you thought. What do we do now? You can get some advice. Getting good financial advice can help take the breathless panic out of a sudden change, or just expand your range of options if you are locked into thinking about something just one way. Getting someone to think creatively about your situation can help you a great deal.
You unexpectedly receive a large sum of money
An inheritance, a bigger bonus than you thought, a tax refund. A very large sum is one year's salary or more. These can be life-changing: accelerating you towards your goals. But they can so easily be wasted. A few month's salary applied to your home loan could tip the balance enough to help you get debt free years earlier than planned. Or be frittered away on a slightly newer car. Of course, if you need the car more than anything else, fine, but maybe take advice?
You need to think about what happens when you are gone
When our favourite wizard knew he was about to die it was a great relief Albus Dumbledore turned up - even if that incarnation was only in Harry's mind. A plan for when you die - a will, documents organised, an executor, a list of wishes, and so on: these can provide that wise counsel to your loved ones at just the right time.
SOUTHERN CROSS RESULTS SHOW GROWING DEMAND FOR PRIVATE HEALTHCARE
Southern Cross Health Society released its annual financial results today, showing growth in both membership and the number of elective surgical procedures performed.
The 2016 financial year saw the Health Society membership grow to 820,469 – a net increase of just over 9000 members – and the number of elective surgical procedures grow by 10%, reaching 200,000 for the first time.
During the year the Society received $871m in premiums and paid $749m in claims. This included:
206,000 surgical procedures
428,000 specialist consultations
726,000 GP visits
Southern Cross Health Society CEO Peter Tynan says the growth in members is pleasing as the Society’s focus is on organic growth and retention.
“The Health Society continues to attract new members by providing excellent value for money – we pay 86 cents for every dollar received in premiums.”
The growth in new members and accompanying lower levels of claiming has resulted in a surplus of $35 million. This will be used by the Society to mitigate future premium increases, to improve services and to maintain reserves at appropriate levels.
“Because we don’t have to pay dividends to shareholders, here or overseas, any income not used to fund healthcare services is used for the benefit of members – either expanding policy coverage, improving services, strengthening reserves or running the Society,” says Tynan.
“However, our key concern remains the rising cost of medical treatment and how we deliver value to our members in this environment.”
In the past year the business has continued to grow its Affiliated Provider programme – Southern Cross’ vehicle to mitigate medical inflation where specialists and providers provide healthcare services at agreed prices – to the point where it now accounts for over 50% of all claims costs.
The business has also continued to invest in digital transformation projects that make it easier for members to claim for healthcare services such as the My Southern Cross online platform and app where members can manage their policy online, as well as growing the Easy-claim network of providers.
“We want our members to make the best use of their policies– one way of doing this is by making the claiming process as easy as possible. We believe we’re on the right track as 71% of all claims received are now done electronically.”
ANZIFF have announced the finalists for 2016 New Zealand Insurance Industry Awards in a media release yesterday.
The Australian and New Zealand Institute of Insurance and Finance (ANZIIF) is pleased to announce the finalists of the 2016 New Zealand Insurance Industry Awards.
The Awards, which are now in their fifth year, recognise excellence and achievement by the top performing individuals and businesses in the industry.
"The New Zealand Insurance Industry Awards are an opportunity to reflect on and celebrate what is great about New Zealand insurance: the sense of community, the commitment to excellence and the many successes that has enabled it to become a true global leader. This year's Awards recognise the highest achievers in the industry, but they also work to celebrate and highlight the contribution that those in insurance make to the community." said Prue Willsford, CEO, ANZIIF.
You can view the finalists at this link and also register for the event which is being held on Thursday the 10th of November 2016 at the Sky City Convention Centre.
Lemonade is the new name in P2P insurance. It has launched offering homeowners and renters cover for New Yorkers. The way in which it is P2P doesn't seem quite the same as the way, say, Harmoney, is P2P. We shall follow their development with interest, however, as we share their interest in the future. Link.
AMP Australia have recently posted an article titled '6 tips for managing money and memory loss' which can be found here. Although this is a general financial management tip what drew our attention to it was the issue of accessibility for aged people: it needs to take into account issues like declining sight and memory, and eventually, competence.
This recent announcement from the FMA states that in November Auckland will be hosting the first Fraud Film Festival in the country. The festival is timed to coincide with November’s Fraud Awareness Week. Click here to read the press release. Here are what we consider to be the top 10 movies about finance:
The Wolf of Wall Street
Too Big to Fail
The Big Short
Glengarry Glen Ross
The Bonfire of the Vanities
We could do a book festival too: The Coffee Trader by David Liss is a masterpiece. There are many others, of course.
This piece in the New Zealand Herald by David Sweanor, Clive Bates, Murray Laugesen makes a number of good points about the health benefits of widening the availability of e-cigarettes. It is worth a read. If the actual benefits from switching to e-cigarettes are this large, and medical opinion from the Royal College of Physicians in the UK suggests that it is, then there may also be a case for a rating difference for insurance.
Seven life and personal lines insurance companies re-priced a total of 17 insurance products in the quarter to 15 September. That's up from three companies in the previous quarter.
Eight companies revised policy wordings for a total of 14 insurance products in the quarter, up from five companies revising twelve products the quarter before.
That highlights the pace of change - and just how important it is to actually check the wordings and pricing for the products you are either offering, recommending, or buying depending on your role in the value chain. The market is becoming more dynamic almost quarter by quarter at the moment, reinforcing a trend that is at least three years long.
More details will be available to subscribers of the Quarterly Life report, which should be released at the end of the week.