Investment Trends<\/a> 2016 Planner Risk Report, the research firm has revealed that while the commencement date for the proposed Life Insurance Framework reforms remains unclear, ‘…many planners have already begun adjusting their business models in anticipation of the reforms.’<\/p>\nA statement accompanying the release of this detailed annual report noted the average adviser ‘…has seen risk advice fall from 35% of their total practice revenue in 2015 to just 28%, the lowest since 2013.’ It added that a number of planners have even stopped providing risk advice altogether, with 12% not writing any new risk business in the last year, up from 10% in the previous study.<\/p>\n
…more than two in five planners expect their practice’s profitability to decline if the LIF reforms are implemented<\/h6>\n
Investment Trends Senior Analyst, King Loong Choi<\/strong>, commented that “The LIF reforms are already testing the business models of financial planners across Australia…Not only are they already reporting a fall in risk business, more than two in five planners expect their practice’s profitability to decline if the LIF reforms are implemented.”<\/p>\nThe research firm also revealed findings demonstrate that if the LIF reforms are implemented, many planners will look to make three key adjustments:<\/p>\n
\n- Provide insurance advice as part of a broader holistic package more often<\/li>\n
- Charge more for holistic advice<\/li>\n
- Focus more on higher balance clients<\/li>\n<\/ol>\n
“This shift is already underway, and planners intend to continue adjusting their business models in this way if the reforms are implemented,” noted Choi.<\/p>\n
Insurers must solidify planner relationships<\/strong><\/p>\nFocussing on the growing importance of retention, another critical finding in the research was that half of planners surveyed said they stopped writing new insurance business with at least one insurer in the last year.<\/p>\n
…the top reason planners switch insurers is because they found a better deal elsewhere for their clients<\/h6>\n
Recommending that life companies must actively promote the competitiveness of their offerings, the report documents the top reason planners switch insurers is because they found a better deal elsewhere for their clients:<\/p>\n
“The recent media scrutiny has triggered planners to demonstrate they are picking the best insurers for their clients,” said Choi, who also advocated that insurers should grow their brand awareness among consumers “…because it is easier for planners to recommend an insurer if the client has already heard of them.”<\/p>\n
Choi said insurers can improve retention and reduce attrition by being responsive to planners’ needs and keeping them satisfied. He said some of the opportunities for differentiation include:<\/p>\n
\n- Addressing any inefficiencies in the application process<\/li>\n
- Providing planners with great support<\/li>\n
- Improving their brand image among consumers<\/li>\n<\/ul>\n
“There are great opportunities for insurers to benefit from switching activity, but they also need to be careful to not lose out from this.”<\/p>\n
BT Life Achieves Top Honour<\/strong><\/p>\nIn collating adviser feedback on individual life companies, the Investment Trends 2016 Overall Satisfaction – Insurer Award, was won by BT Life, where it achieved the highest user satisfaction score in this year’s study. The top three life insurers by user satisfaction are:<\/p>\n
\n- BT Life<\/li>\n
- AIA Australia<\/li>\n
- TAL<\/li>\n<\/ol>\n","protected":false},"excerpt":{"rendered":"
New research hot off the press is reporting the proposed LIF reforms are already impacting the way advisers are positioning their business model, including their client proposition.<\/p>\n","protected":false},"author":3,"featured_media":34322,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8,3],"tags":[4247],"class_list":["post-34279","post","type-post","status-publish","format-standard","has-post-thumbnail","category-compliance-regulation","category-general","tag-feature"],"_links":{"self":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/34279","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\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/comments?post=34279"}],"version-history":[{"count":0,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/34279\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/media\/34322"}],"wp:attachment":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/media?parent=34279"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/categories?post=34279"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/tags?post=34279"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
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