Asteron Life has released a range of new commission structures including a new hybrid rate and customised and wholesale rates which provide premium discounts for clients.
The new structure will retain upfront commissions at 110% in the first year and ongoing commissions at 11%, and level commissions at 27.5% for both the first year and ongoing, with neither offering a premium discount.
Asteron Life Executive Manager, Mark Vilo said the early addition of hybrid commissions was to allow advisers moving away from upfront commissions to prepare their businesses for the Life Insurance Framework (LIF) changes set to begin on 1 July 2016.
While the commission rates under the LIF legislation are set at 80% in the first year and 20% ongoing Asteron will offer a further 10% per cent commission for the first year resulting in an 88%/22% hybrid model (inclusive of GST), however, this will also not attract any premium discounts.
These instead will apply to customised premiums, which will range for 0-88% in the first year with ongoing commissions ranging from 0-22%, with the commission level dialled up or down by advisers in 2% increments. Premium discounts will vary accordingly from 0-25% depending on the commission chosen by the adviser.
Wholesale commission rates of 0% in the first year and ongoing will attract a 25% built in premium discount with a further 15% premium discount in the first year on offer to new clients of Asteron Life.
Vilo said the wholesale rate was being offered for advisers interested in transition to a full fee for service business model while the range of commission structures would allow advisers to tailor the cost of advice to individual clients.
The life insurer said the rate structure, which was announced in November last year, will take effect from 18 January 2016.
