ClearView Call to Action on Risk Commissions

ClearView Wealth has undertaken a series of initiatives intended to consolidate support for the retention of life insurance commissions.

ClearView’s Head of Distribution Strategy, Kathryn Williamson

Risk Commission Survey

In the shadows of a Federal Election, the insurer has been asking advisers to participate in a brief survey that seeks both information and opinion from advisers regarding their remuneration and the impact on their business of the Banking Royal Commission remuneration recommendations, if implemented.

In a message to advisers this week, ClearView’s Head of Distribution Strategy, Kathryn Williamson, has conceded that the industry has failed to get its ‘value of advice’ message to gain meaningful traction in the mind of the consumer.

Referring to the current debate on the future of risk commissions, Williamson says “…we – as an industry – haven’t done a good enough job of telling others about the value of professional advice and why commissions are a valid form of remuneration.”

In seeking to rectify this collective failure, Williamson is calling on the four thousand advisers who she says do business with the insurer to share with ClearView details about their businesses, their experiences and their concerns. Armed with this information, she says ClearView will then raise these issues with key regulators and policy makers.

Commission Advocacy Meetings

Williamson’s message follows a similar call earlier this month by ClearView’s GM Distribution, Christopher Blaxland-Walker who, in addition to promoting the adviser survey, told advisers the insurer has recently facilitated meetings in Sydney and Melbourne between key Liberal and Labor party advisers and financial advisers/dealer principals: “These forums were a unique opportunity for advisers to talk about the good work they do and for both parties to discuss financial services policy,” said Blaxland-Walker.

These recent initiatives by ClearView follow the public declaration made by its MD, Simon Swanson, at the FSC’s annual Life Insurance Conference in Sydney in March, at which Swanson strongly advocated for the retention of risk commissions (see: ClearView Statement in Support of Commissions).

Click here to link to ClearView’s survey on life insurance commissions.

  • Jeremy Wright

    From day one, many Risk Advisers have been advocating for a separation of Life Insurance advice from Investment advice. WHY?

    The reason all those years ago, is the same reason today and the fiasco we are now in, is because no-one listened back then and very few are listening now.

    We have a situation where the Government, the Regulators, the FSC, the FPA and even many of the Life Insurance Companies do not understand that Life Insurance advice is a very different industry to everything else and a most difficult Industry to work in.

    The Commission reduction and 25 month responsibility period with nil restrictions imposed on Life Companies from increasing premiums within the responsibility period, plus the FASEA debacle that means experienced practice owners who have provided advice for decades, will be forced out of the Industry because they will not hold a bit of paper that has nil bearing on their service to the Industry and their clients, how is that BID.

    You do not need a crystal ball to see what is going to happen within 2 years.

    There will continue to be a decline in premium income to the Life Companies, a growing exodus of advisers who specialised in risk advise and a growing Under- insurance epidemic.

    And what will the Life Insurance guru’s do to overcome the rising claims and reducing premium income?

    They will do what they always do and increase existing clients premiums, which will further increase cancellations until the deck of cards collapses and it was all so unnecessary.

    • Squeaky_1

      You know Jeremy, a few of the life execs (TAL, Clearview, MLC and another I think) to their semi-credit have come out to champion commissions in the past few months. HOWEVER, they do NOT mention the points you make, specifically the responsibility period and no premium increases. I honestly deeply despair at this. Life companies prior to the 90s had real leadership that was an advocate for advisers, not now sadly. We could somehow manage the reduction in commission to where it is now but this 25 mth clawback is beyond reprehensible while the life companies bear zero responsibility or share of that potential clawback.
      .
      I’m afraid, after 34 years, I will be one of those of whom you speak – out within the next 2 years. I’m not going to waste SIGNIFICANT time and money to get a bit of paper that will do ZERO to benefit my risk clients. I am a pure risk adviser and I refuse to waste my time doing FULL blown financial planning exams just to continue helping clients with risk insurance. What if I fail? I’m a simple risk adviser and extremely good at it and dealing with people. I’m not that good at derivatives, CFDs, international currency exchange, complex retirement planning or investment theory/strategies. Any of those could fail me and for what?! It is ludicrous that risk advisers have to sit these subjects to get their ‘degree’ – beyond useless. May as well have doctors needing to do a degree in brain surgery before they’re allowed to be a GP.
      .
      It is an nothing less than an insult and the ‘powers’ forcing us to do this generally have little qualifications themselves i.e. politicians, ASIC, that ridiculous out-of-touch Hayne creature. I have not written new business since this new clawback period came in! I refuse to be beholden to a damn life company for income studiously and honestly earned and spent that they can whip back at a moments notice with no recourse on my part. That is just insane and Australian if you ask me. I refuse to be part of it anymore as it disgusts me.
      .
      The industry I loved and championed through my 20’s, 30’s and 40’s now completely disgusts me. I will service my clients as best I can and live quite comfortably from my renewals thank you very much. These life company execs that didn’t raise a finger to stop this criminal clawback period can whistle for their new business – they’re not getting any from me – and I used to write a LOT. Bugger them! I am NOT actively looking to write new business anymore. I refer my clients to a trusted younger adviser now for writing any new business if it is truly required but I’m not looking for it at all. It is his decision to take the clawback risk then. God love him and God help him.

  • Free and FAIR press

    Mortgage Brokers were successful in getting the government AND opposition to disregard the Royal Commission’s recommendation to ban upfront and trail commissions because the public would have been worse off and winners would have been the big banks.

    Mortgage Brokers succeeded because their two main associations worked TOGETHER and got the support of small banks and non-bank lenders both in terms of funding and resources.

    Can the AFA and FPA PLEASE work together with the insurers to meet with the Treasurer Josh Frydenberg and the Financial services ministerial team to help them understand that the logic is identical when it comes to the Royal Commission’s recommendation to ban Personal Insurances commissions because in this instance the big winners will be the superannuation funds whose insurance cover is typically more expensive and provides less cover and the losers will be the consumer who is not willing or unable to pay a fee for service for good financial and risk advice.

    Various insurers individually putting up with whitepapers to state why banning commissions is bad for the public, has limited effectiveness.

    The FPA rolling over and saying “we support the Royal Commission’s recommendations” is counterproductive to the cause.

    What is needed is a united effort led by the two main associations with the financial and resource support of insurers, to help the government understand the harm that banning insurance commissions will cause and why the Royal Commission’s recommendation recommendation to ban upfront and trail commissions is NOT in the public’s best interest!