{"id":29436,"date":"2015-04-21T16:26:11","date_gmt":"2015-04-21T06:26:11","guid":{"rendered":"https:\/\/riskinfo.com.au\/news\/?p=29436"},"modified":"2015-04-21T16:26:39","modified_gmt":"2015-04-21T06:26:39","slug":"synchron-calls-for-insurance-product-innovation","status":"publish","type":"post","link":"https:\/\/riskinfo.com.au\/news\/2015\/04\/21\/synchron-calls-for-insurance-product-innovation\/","title":{"rendered":"Synchron Calls for Insurance Product Innovation"},"content":{"rendered":"

The objectives of the Trowbridge report could be achieved through improved product design and smarter underwriting, according to Synchron, which is urging insurers to step up to the plate.<\/span><\/p>\n

<\/p>\n

\"Synchron<\/a>
Synchron Independent Chair, Michael Harrison<\/figcaption><\/figure>\n

The risk-focused licensee said it believes John Trowbridge\u2019s report on the life insurance advice industry chose to focus too heavily on adviser remuneration and did not put enough pressure on insurers to make changes to products and systems.<\/p>\n

The comments follow an overseas fact-finding mission undertaken by Synchron Director, Don Trapnell, and Synchron Independent Chair, Michael Harrison. Mr Trapnell and Mr Harrison met with a range of stakeholders from the UK\u2019s advice and insurance sectors, seeking information on the recent changes to the UK\u2019s financial advice regulation regime and how these have impacted products, advice quality and business models.<\/p>\n

Synchron said the results of its fact-finding exercise have led to the determination that the issues of mis-selling and \u2018churn\u2019 could be more effectively addressed through improved product design and product implementation solutions, rather than through remuneration measures.<\/p>\n

…we now intend to seek partners that are prepared to offer life insurance products that meet our specifications<\/h6>\n

Synchron\u2019s report noted that \u2018\u2026 in both the UK and South Africa the [insurance] companies acted to eliminate churn (which in turn eliminates the alleged nexus between high upfront commission and bad advice) by introducing longer responsibility periods, whereas in Australia the companies have declined to act and are seeking Government intervention or regulation, and blaming all the issues on the advice channel.\u2019<\/p>\n

The licensee is attempting to drive the Australian industry forward by approaching insurers with a list of desired product and technology solutions.<\/p>\n

\u2018We believe the Trowbridge objectives can be met by improved product design and smarter underwriting and we now intend to seek partners that are prepared to offer life insurance products that meet our specifications, in the same way that general insurance cluster groups are successfully seeking underwriters to support their product design,\u2019 Synchron said in its report.<\/p>\n

Among the product developments being proposed by Synchron are:<\/p>\n

    \n
  • An electronic underwriting system that incorporates a simple point of sale assistant to assist with the process<\/li>\n
  • Level premium fixed term products, with a hybrid commission model<\/li>\n
  • An \u2018advance payment\u2019 option allowing advisers to draw on future commission earnings to enable them to recover the full cost of writing new business<\/li>\n
  • Flexible products which allow advisers to shape premiums to more accurately serve the needs of consumers<\/li>\n<\/ul>\n

    Speaking to riskinfo after returning to Australia, Mr Harrison said he was confident the \u2018bottom up\u2019 approach could yield results within a relatively short timeframe.<\/p>\n

    \u201cI\u2019m hoping that we will have some things ready to go to market by July 1,\u201d Mr Harrison said. \u201cIt may just be some small product innovations to start with, but most life companies already have the systems to do what we want to do. It\u2019s not that radical, it\u2019s just there\u2019s been no pressure or demand from advisers or licensees.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"

    The objectives of the Trowbridge report could be achieved through improved product design and smarter underwriting, according to Synchron, which is urging insurers to step up to the plate.<\/p>\n","protected":false},"author":7,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8,6,4,270,7],"tags":[],"class_list":{"0":"post-29436","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-compliance-regulation","7":"category-dealer-groups","8":"category-products","9":"category-remuneration","10":"category-technology"},"_links":{"self":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/29436","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/users\/7"}],"replies":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/comments?post=29436"}],"version-history":[{"count":0,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/29436\/revisions"}],"wp:attachment":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/media?parent=29436"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/categories?post=29436"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/tags?post=29436"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}