moneyblog

nib Ultimate Health Travel Insurance

nib have introduced a complementary travel insurance benefit to their Ultimate Health and Ultimate Health Max products. Travel cover applies for all lives insured on the Ulitmate health insurance policy and cover multiple overseas trips of up to 38 days each, taken during a maximum 12 month period.

The cover includes a range of benefits including, emergency medical and dental expenses incurred overseas, cancellation costs, damaged luggage, personal liability and more. Below is a summary table of some of the limits.

 

nib Product Enhancements

nib have announced a number of enhancements to their Ultimate Health, Ultimate Health Max and Easy Health cover.

The changes will apply to new and existing Ultimate Health Max, Ultimate Health and Easy Health business and there is a complementary travel insurance cover for new Ultimate clients.

Below is a table of the new benefits and upgraded benefits to Ultimate Health Max.

You can click here to read more and access the brochures, policy docs and application forms. 

Compliance applies to everyone: surgeon failed to provide services with reasonable care and skill

Good records and note keeping is also a key theme from the recent FMA enquiry. This surgeon was among other things, specifically criticised for inadequate and illegible notes: "The surgeon did not inform the man of this diagnosis or discuss management options with him. The surgeon then noted that the white lesion had returned, and that an additional biopsy would need to be performed under general anaesthetic," the report by the Health and Disability Commissioner said. Click here to read more. 

Although I am very sorry for the patient in this case, and I know every professional has lapses from time-to-time, but I did want to highlight the importance of the basics: needs analysis is our equivalent of examination, recommendation is diagnosis and prescription, and note-taking is vital.

None of that is rocket science.

I saw an adviser on Tuesday that showed me outstanding fact-finds and statements of advice that are built using nothing more complicated than a form, in a $12 piece of software (notability) run on an Apple ipad. It includes the ability to record the interview, and then they prepare the SOA in a Microsoft Word document. Sure, there are opportunities to make this better, save time, reduce errors, and improve. There is also no reason that a fully compliant business cannot be run using basic tools, at low cost, using a high level of care and attention.

Terminally ill dad saves more than $200k bringing in cancer drugs from India

Baden Ngan Kee was diagnosed with terminal lung cancer in 2016 and it has now spread to his brain. He was told the drugs he needed were going to cost $23,000 a month and were not funded by Pharmac. Ngan Kee turned to Google and found the same brand-name drugs were available cheaply in India and there was a generic version which would cost even less. All three drugs he needed from India cost less then $1,300 per month. Concerned about quality, he had them tested:

'Using mass spectrometry, a contact tested both the brand-name and generic drugs he'd imported. They were chemically identical to the branded version available here.'

He even did a reasonable job of making sure that he could import the drugs, and meeting the requirements to do so. The whole process is remarkable. I bet very few people would have the intelligence, tenacity, and time required to do this. Even though I do not know this man I have some sense of what we will lose when he dies. New Zealand will be poorer without him.

Click here to read more. 

How and where growing numbers of Americans are taking their own lives

New Zealand is not alone in having a problem with a high rate of suicide. The United States has a bigger problem with gun ownership, and it generates a lot of headlines. What amazed me, however, was how much more prevalent suicide is because of the easy availability of guns. Although murder and misadventure are given many more column inches, two times as many people in the US die from self-inflicted gunshot wounds. Those deaths, too, are preventable.

33 people took their own lives last year but jumping off the Golden Gate Bridge last year, a suicide-prevention barrier has now been agreed on and will be completed in 2021 at the cost of $204m USD. 

'Though jumping is a relatively rare way to end one’s life, it is on the rise. There were 1,123 such deaths in 2016 compared with 788 in 2010. The same trend holds for suicides by gunshot, overdose and hanging, according to an analysis by The Economist of mortality files from the Centres for Disease Control.'

Click here to read more. 

Pricing for risk is a privilege for the insurance industry, and a valuable price-signal for society

Tower is looking at increasing premiums on properties which are earthquake prone or are in high-risk earthquake regions. Some people don't like the idea of risk-pricing, and see it as a 'backward step for society'. Click here to read more. 

I believe that risk pricing is one of many ways that the price signal helps to shape behaviour in ways that are helpful to individuals and society as a whole. I find that it is interesting that pricing for risk is condemned when it is conducted by insurers, but is considered a valuable good when applied to, for example, the tax on cigarettes.

Wind back the clock, if you like, to a time before any additional tax on cigarettes. Tax was neutral in the question of whether to buy an apple, or a cream bun, or a cigarette to enjoy at afternoon break. Should we return to such a situation?

Now consider the cost for insuring buildings that are more earthquake prone, or are built in areas that are more earthquake prone. I am not arguing for the relocation of Christchurch away from the fault-lines, but is it fair on someone who has built their property to a high standard to have to subsidise someone who has not? The price signal insurance sends can help to distribute development more sensibly. Earthquakes are just one issue. What about developments along an increasingly flood-prone coastline. Should inland dwellers (most of us) subsidise the increasing cost if insuring coastal mansions against climate change?

Risk-pricing is a privilege the insurance industry enjoys, and it happens to benefit many, indeed society as a whole, including those that have to pay a higher premium, through the signals it sends.

Quotemonster Heads to New Plymouth

Quotemonster are heading to New Plymouth on the 5th of June! Popular demand said we had to go to Taranaki, and I am very pleased to say I will be presenting that session myself. I love Taranaki and have friends there. Click here to register for the workshop. We also have have these events coming up in the next couple of weeks too and it's not too late to register:

• Queenstown – 23 April
• Invercargill – 24 April
• Dunedin – 24 April
• Rotorua – 1 May
• Whangarei – 3 May

Underinsurance: a significant cause of disputes

Underinsurance has always been a significant cause of disputes, and litigation, in general insurance - the Canterbury Earthquakes have just made it much more visible, with this case being just one more example.

But how significant has it been in life and health insurance? Historically, nothing like as significant. But as a cause of complaint it has been growing, and needs to be considered as a number of forces are making it more of an issue:

1. Information - in times past a new cancer treatment developed in the US or Europe took years to reach New Zealand. Now, courtesy of the internet, consumers are able to search for treatments, drugs, and research easily (like this case). The increased awareness has focused people on the limits of the public health system - which helps to push some towards buying insurance. At the same time it will make them more demanding as customers.
2. Education - consumers are better educated and more aware of their right to check, complain, and seek legal redress if they feel unhappy about something. Although, at the time, the focus of ABC's Four Corners investigation was more about definitions, Jame's Kessel's case could be seen as one of underinsurance: his policy paid out, it is just that the amount paid for the type of heart attack that he had, was low. If that had been a policy sold by a financial adviser, that may well have been the approach taken.
3. Product - in the past you either had income protection insurance, or more likely, you didn't. Today sales of modest sums of mortgage protection are very much more common. In the past  products offered a full payment for a trauma event, or nothing. TPD did not used to have partial payment features. The growth in options which pay out at a lower level increases the risk that clients will look at the headline number, and be disappointed when the payment is lower.
4. Media - a modest grumble in social media can quickly be picked up mainstream media and creates good copy.

I am a believer that you can safely offer affordable packages and products that obey the principle of indemnity, but they do require a good advice process. Sometimes less means more - you may have to do more work to ensure that an incomplete solution is not going to result in a complaint from the client.

 

Kepa takes a stake in the Financial Design Group

Risk Info NZ has this piece on Kepa taking a stake in the Financial Design Group. Link.

Waikato men told to see their doctor after being screened at health event

Over half of the men who attended a recent health event in the Waikato were referred to go and see their GP's after undergoing some screening tests. Click here to read more. Taking care of yourself isn't a form of self-indulgence, it happens to be one of the best ways to help the people you love. Go and get checked guys.

QPR Update

QPR V110 has just been uploaded to Quotemonster and the database has been distributed to institutional subscribers. This version includes the following changes:

1. Special Events incidence - change to 3.00% for Life & TPD.
2. AMP Essentials (Non-UW) life cover rated.
3. AMP Essential (Non-UW) trauma (standalone) cover rated.
4. AMP Esssential (Non-UW) IP Indemnity rated.
5. Sovereign Agreed Value / Indemnity / LOE - Enhancements rated.
6. Sovereign Mortgage Protection - Enhancements rated.
7. Review of Financial Planning and Legal Benefit

 

UK: ABI Publishes Gender Pay Gap Data

The Association of British Insurers has published diversity and gender pay-gap information which you can check out at this link. They have also published details of the gender make-up of their management team.

New Health / Medical Rates Comparison Update

We have just published a new Medical Comparison on Tableau Server. V64. The only company updated since v63 is nib, with rates update from 1^st April.

Why have my compliance people gone all surly?

Well, my compliance people haven't gone surly, because Rob Dowler is a reliably cheerful person. But if you are wondering why your compliance manager has gone surly, it might be because they are buried in work. Here, courtesy of Rob Dowler, is a list of all the current consultations.

Summary Consultations list – 17 April 2018 - Paper prepared by: Rob Dowler, Red Owl Consulting Ltd
Format: consultation on, notes, due date:

Government Tax Working Group – Submissions sought on the future of tax – Background paper released 14 Mar 2018. 30 April 2018
CWG - Financial Services Legislation Amendment Bill, Code of Professional Conduct – High level principles. 30 Apr 2018

NZX – Consultation on NZX Participant Rules covering:
• Off-market crossings
• Bringing orders to market
• International crossings and other
Due, 11 May 2018

Financial Services Legislation Amendment Bill, MBIE regulatory consultation on addressing misuse of the Financial Service Providers Register. 11 May 2018
FMA - Consultation on including an annual declaration of compliance in regulatory returns and updating the standard regulatory returns condition. 14 May 2018
FMA - Length limit exemption for dual-language PDS. 17 May 2018
Privacy Bill – Submissions to Select Committee. 24 May 2018
Financial Services Legislation Amendment Bill, MBIE regulatory consultation on Disclosure. 25 May 2018
NZX – Consultation on Main Board/Debt Market Listing Rules – Phase 2. 8 June 2018

There is a long list of consultations awaited, but I'll post that in a day or two.

Apologies for the outage

The good folks at Typepad provide pretty awesome service most of the time, but we were down for about five hours today - thanks to those who let me know, but it was scheduled maintenance at Typepad.

Guide to submitting on CWG paper and more

The guide you can find at this link, by Partners Life, is excellent for advisers considering submitting on the Code Working Group (CWG) proposals. I am very happy to publish links to other guides and discussion papers, so please send me them if you think they are worthwhile.

Sovereign Income Protection and Mortgage Protection Products Updated

Sovereign has updated income protection and mortgage protection products with a number of enhancements, including:

• Increased maximum cover limits
• Additional wait period options
• Indexation options for Mortgage Protection
• Removal of offsets from bed confinement benefit
• and other changes.

More details will be included in the quarterly life report, including the impact on the product index score for Sovereign and others.

Kris Faafoi interview - worth listening to

Philip Macalister's interview with Minister of Consumer Affairs, Kris Faafoi, is well worth listening to. The good bits really kick in at about 3.30 into the video. That is where Philip asks the minister about the Code Working Group, and the minister makes his expectations clear. Here is a small sample, but well worth watching the whole interview:

“My clear expectation was given to them at that first meeting that, along with the big players in the market who would serve the majority of consumers in the market, that small industry players who had voiced their concerns were to be consulted with as well, and that is still my expectation.”

He said he was primarily concerned that that the final product decided upon by the working group was for the benefit of consumers.

It is worth noting the three main parts of what is going on right now:

1. The law will go to select committee
2. The drafting of the Code
3. The consultation on disclosure requirements

At this stage I feel most comfortable with the last point. It is the interaction between submissions on the law and the drafting of the Code where the impacts on availability of advice for consumers, driven by competence requirements and costs that may weigh on advice businesses, could vary widely depending on choices made.

Congratulations to AA Insurance

AA Insurance is listed as the 4th most reputable New Zealand business. That's quite a feat, and nice to see an insurer make it. Congratulations folks!

nib on the IBM Watson journey

nib are trialling technology for six months to assess customer use, uptake and suitability in its overall digital strategy. 'With the analytics running in the background NIB are able to draw out the types of questions customers are asking, how they feel about the experience through its ratings, and understand what customers want to talk about to see if any refinements need to be made  in the conversation.'

Click here to read more.