{"id":45908,"date":"2019-08-08T09:45:21","date_gmt":"2019-08-07T23:45:21","guid":{"rendered":"https:\/\/riskinfo.com.au\/news\/?p=45908"},"modified":"2019-08-14T07:24:13","modified_gmt":"2019-08-13T21:24:13","slug":"unprecedented-change-to-slow-growth-in-life-risk","status":"publish","type":"post","link":"https:\/\/riskinfo.com.au\/news\/2019\/08\/08\/unprecedented-change-to-slow-growth-in-life-risk\/","title":{"rendered":"\u2018Unprecedented Change\u2019 to Slow Growth in Life Risk"},"content":{"rendered":"<p class=\"p1\"><span class=\"s1\">Growth of the retail wealth management market segment has been projected to slow, according to a recent <a href=\"http:\/\/www.dexxr.com.au\/\" target=\"_blank\" rel=\"noopener\">DEXX&amp;R<\/a> Market Projections Report.<\/span><\/p>\n<p><!--more--><\/p>\n<p class=\"p1\"><span class=\"s1\">It stated this was to allow for the impact of:<\/span><\/p>\n<ul>\n<li class=\"p1\"><span class=\"s1\">Change in ownership in several currently bank owned wealth managers<\/span><\/li>\n<li class=\"p1\"><span class=\"s1\">Acquisition of life insurers with some now closed to new business<\/span><\/li>\n<li class=\"p1\"><span class=\"s1\">Dismantling of several vertically integrated large wealth managers<\/span><\/li>\n<li class=\"p1\"><span class=\"s1\">Outcomes of the Hayne Royal Commission including the banning of grandfathered commissions, the impact of fee for no service and remediation<\/span><\/li>\n<li class=\"p1\"><span class=\"s1\">Impact of these changes and the phasing in of minimum educational standards for advisers on the advice distribution channel, the primary source of new business for retail wealth managers and life insurers<\/span><\/li>\n<\/ul>\n<p class=\"p1\"><span class=\"s1\">The report noted that the personal advice distribution channel, including aligned and unaligned financial planners and bank based advisers has traditionally generated the majority of new Individual Risk Product premium. <\/span><\/p>\n<p class=\"p1\"><span class=\"s1\">\u201cThe disruption caused by the breakup of vertically integrated product manufacturing and divestment of Life insurance and dealer group subsidiaries is expected to have negative effect on projected Risk segment growth rates,\u201d it stated.<\/span><\/p>\n<p class=\"p1\"><span class=\"s1\">\u201cThe impact of these changes can be seen in the current slowdown in new sales in the individual risk market. Group risk premiums are also showing little growth as the switch to opt-in for under 25\u2019s is adopted by some large industry funds.\u201d<\/span><\/p>\n<p class=\"p1\"><span class=\"s1\">The report highlighted the shift in life company ownership away from banks since 2016, in the graphic below.<\/span><\/p>\n<p class=\"p1\"><span class=\"s1\">It noted the major Australian banks are in the process of selling their life insurance companies, except for Westpac and have held a significant share of the Australian life insurance market for the past 20 years. <\/span><\/p>\n<p class=\"p1\"><span class=\"s1\"><a href=\"https:\/\/riskinfo.com.au\/news\/files\/2019\/08\/Screen-Shot-2019-08-12-at-3.10.27-pm.png\"><img loading=\"lazy\" decoding=\"async\" class=\"aligncenter wp-image-45914 size-full\" src=\"https:\/\/riskinfo.com.au\/news\/files\/2019\/08\/Screen-Shot-2019-08-12-at-3.10.27-pm.png\" alt=\"\" width=\"1342\" height=\"694\" srcset=\"https:\/\/riskinfo.com.au\/news\/files\/2019\/08\/Screen-Shot-2019-08-12-at-3.10.27-pm.png 1342w, https:\/\/riskinfo.com.au\/news\/files\/2019\/08\/Screen-Shot-2019-08-12-at-3.10.27-pm-300x155.png 300w, https:\/\/riskinfo.com.au\/news\/files\/2019\/08\/Screen-Shot-2019-08-12-at-3.10.27-pm-768x397.png 768w, https:\/\/riskinfo.com.au\/news\/files\/2019\/08\/Screen-Shot-2019-08-12-at-3.10.27-pm-1024x530.png 1024w\" sizes=\"auto, (max-width: 1342px) 100vw, 1342px\" \/><\/a>They accounted for 46 percent of in-force business at December 2016 but this figure will drop to seven percent once all announced sales are completed and overseas owned life insurer parent companies will account for over 90 percent of the Australian market. <\/span><\/p>\n<p class=\"p1\"><span class=\"s1\">Total Risk In-Force premiums are projected to increase by an average annual rate of 5.1 percent to $42.2 billion at December 2028.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Growth of the retail wealth management market segment has been projected to slow, according to a recent DEXX&amp;R Market Projections Report.<\/p>\n","protected":false},"author":20,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[],"class_list":["post-45908","post","type-post","status-publish","format-standard","category-general"],"_links":{"self":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/45908","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\/20"}],"replies":[{"embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/comments?post=45908"}],"version-history":[{"count":0,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/posts\/45908\/revisions"}],"wp:attachment":[{"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/media?parent=45908"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/categories?post=45908"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/riskinfo.com.au\/news\/wp-json\/wp\/v2\/tags?post=45908"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}