Chatswood serves the life and health insurance sector in New Zealand with market intelligence, data, and bespoke consulting services. Some of these are provided in conjunction with Quality Product Research Limited - a subsidiary that brings you Quotemonster.
We believe that good decisions are more likely to occur when we have good information about the market environment in which we operate. Intuitive leaps and creative decisions are always required, of course, but the more they are based on a firm foundation of observation, the better they tend to be.
nib release their 2023 State of the Nation Parenting Survey
nib have released their 2023 State of the Nation Parenting Survey, which has found parental concern for children’s mental health has skyrocketed and shows just how severely the current cost of living crisis is affecting families. The survey canvassed the views of 1,206 parents, step-parents and guardians across NZ in June 2023.
Some of the key findings include:
46% of all parents say their biggest worry for their children is the future state of their mental health (up from 40% in 2022).
57% say they are worried about their children’s current mental health.
49% of parents say they are concerned about their child’s physical health (which increases to 59% of Māori parents).
Parents reported the top three physical health concerns impacting their children as sleeping problems (34%), behavioural issues like tantrums, problematic eating and bullying (28%) and diet and exercise (25%).
46% of parents have health insurance (up from 44% in 2022), with 64% having made a claim. Key reasons for taking up private health insurance were peace of mind (52%), quicker access to health services (48%) and confidence they can access health services (48%).
31% of parents are unable to access the support they need to address their child's health concerns.
The survey found that almost all kiwi parents were facing financial stress (93% of households).
49% of parents said financial uncertainty is the main source of household stress (up from 41% in 2022 and 35% in 2021).
66% of parents’ top concern for their kids’ future is cost of living.
19% of parents have gone without essentials such as petrol, heating or skipping meals over the last year.
Food choices are being impacted by increasing financial pressures, with 52% of parents saying they are eating less or differently; 23% keeping grocery spend the same but eating less; 51% eating less fresh vegetables; and 40% eating more processed foods.
Parents have said that increasing costs are negatively affecting their relationships and social lives with 31% reporting a negative impact on their relationship with their partner, 42% having their social lives and connection to friends negatively affected and 25% experiencing a negative impact on the amount of time spent with their children.
14% of families are choosing to delay having more children.
13% of families’ main caregiver is needing to return to work.
Nathan Wallis, nib’s resident parenting expert and neuroscience educator has some tips for families doing it tough right now.
“Parents are under increasing financial pressure and many feel like they don’t have the time, energy or resources to care for their kids and look after themselves but it’s really important that parents find ways to look after their own wellbeing”.
“It’s really important that parents look after their own mental and physical health so that they can show up for their kids. Proactively looking after your own health and wellbeing also has the added benefit of role modelling good behaviours to your kids. When parents role model healthy eating habits and exercise their kids tend to follow”.
“It might be as simple as coming together for a family meal or taking the kids for a walk or kick a ball around at the park. These healthy habits are great ways to bond with your kids and set them up for success”.
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Swiss Re write about redefining sustainability in life and health insurance
Daisy Ning, Head Life & Health Re APAC ex. China, writes about how sustainability can be applied more broadly in the insurance and reinsurance context. Swiss Re believe sustainability aligns with what they refer to as the ‘3A’s’ of life and health insurance:
accessibility (the ease of acquiring coverage), availability (whether suitable plans and products exist to cover the full range of L&H needs), and affordability (whether products and plans are priced fairly and within consumers’ means).
Ning advocates for formulating strategies that manage risk, improve adaptability and explore opportunities – regardless of market conditions; assessing trends and value delivered to clients and adjusting as necessary; and enhancing value delivered to clients by making insurance solutions more relevant.
The global protection gap in 2022 was sitting at US 406 billion in premium equivalent terms, up 1.5% since 2021. A recent Deloitte estimate has the Australian public at 60 – 80% underinsured. A Swiss Re estimate of NZ’s mortality protection gap was USD 435 billion (NZD 670 billion) or more than USD 540 000 for each household, as of 2020.
Ning suggests we need to leverage connectivity and digitalisation to make products more affordable; leverage big data and advanced analytics to uncover insights into market trends, customer behaviour and risk factors and create products that address emerging needs discovered through this process; look at digital health underwriting; and increase reach through building alliances with online platforms, aggregators, fintechs and other digital players.
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Legal and regulatory update for the life and health insurance sector
17 Oct 2023 - The Australian Prudential Regulation Authority (APRA) has released its Life Insurance Claims and Disputes Statistics publication, covering a rolling 12-month period from 1 July 2022 to 30 June 2023. https://www.apra.gov.au/news-and-publications/apra-and-asic-publish-latest-data-on-life-insurance-claims-and-disputes-7
18 Oct 2023 - The Australian Prudential Regulation Authority (APRA) has released its 2023 authorised deposit-taking institutions (ADIs) points of presence statistics.
The points of presence statistics are a detailed listing of the physical banking service channels provided to Australians, including branches, ATMs and EFTPOS facilities. https://www.apra.gov.au/news-and-publications/apra-releases-latest-points-of-presence-statistics-for-authorised-deposit
19 Oct 2023 - The Australian Prudential Regulation Authority (APRA) has released observations on credit risk provisioning practices for locally incorporated authorised deposit-taking institutions (ADIs). https://www.apra.gov.au/news-and-publications/apra-releases-observations-on-credit-risk%C2%A0provisioning-practices-for-locally
19 Oct 2023 - The FMA has reviewed an existing class exemption notice that allows product disclosure statements to be provided in full in both te reo Māori and English (dual language PDSs) and granted the extension to continue this relief. https://www.fma.govt.nz/business/focus-areas/consultation/dual-language-te-reo-maori-pds/
20 Oct 2023 - Peter Boshier, Chief Ombudsman, publishes his 2022/2023 Annual Report https://www.ombudsman.parliament.nz/news/trust-and-demand-ombudsmans-services-higher-ever
Industry-relevant changes as new government is ushered in
With Labour soon to hand over control to a National and ACT led government (perhaps with support from NZ First), the question on everyone’s lips is what does this mean for our sector?
National have previously come out against the proposed Income Insurance Scheme, with Christopher Luxon calling the levies required to fund the scheme a ‘job tax’. One of National’s 100 day action plan pledges is to stop work on the so-called ‘job tax’. This change could be seen as a positive move as last year Risk Info NZ ran a poll with 80% of respondents not supporting the introduction of a state-backed income insurance scheme.
National promised to repeal the Conduct of Financial Institutions Act (CoFI), due to come into force in March 2025, which they’ve said “makes credit more expensive and harder to obtain even for basic services such as overdrafts and mortgages”. Meanwhile, Katrina Shanks, chief executive of Financial Advice NZ, has said it would be ‘preferable’ to tweak CoFI, rather than scrap it altogether, as the industry is very supportive of legislation that endorses good conduct and culture within the sector.
National has promised to roll back measures brought in by Labour including the Credit Contracts and Consumer Finance Act (CCCFA), with their rebuilding the economy plan saying they will “Cut financial red tape that is stifling investment, including significantly reducing the scope of the CCCFA which has restricted access to credit.”
National has said they will allow people to split their KiwiSaver between multiple providers, which they say will ‘drive innovation, boost competition and put downward pressure on fees’, though industry players have reservations around the complexity and added costs of doing this. Another tweak to the KiwiSaver scheme they have promised is allowing young people to use their retirement savings to pay a rental bond. Instead of tinkering with the scheme, the FSC is instead calling for a comprehensive review of KiwiSaver settings.
One of the agenda items on National’s 100 day action plan is to remove the Reserve Bank’s dual mandate (of managing inflation and supporting maximum sustainable employment) to get the RBNZ purely focused on getting inflation down to targeted levels.
From a health perspective, National’s 100 day action plan includes extending free breast cancer screening for women aged up to 74, from the current cutoff of 69 years of age. National have said they will allocate $280 million in ring-fenced funding to PHARMAC over four years to pay for 13 cancer treatments not currently funded in NZ. National have said they will deliver faster access to mental health services through their Mental Health Innovation Fund, which will initially see up to $20 million in matching funds distributed to community mental health organisations who are delivering strong results for Kiwis in need. They have pledged to extend free postnatal stays for mothers of newborn babies to three days and provide free continuous glucose monitors to type 1 diabetics aged under 18.
National’s five major targets for health will be:
· Shorter stays in emergency department – 95% of patients to be admitted, discharged or transferred from an emergency department within six hours.
· Faster cancer treatment – 85% of patients to receive cancer management within 31 days of the decision to treat.
· Improved immunisation – 95% of two-year-olds receiving their full age-appropriate immunisations.
· Shorter wait times for first specialist assessment – a meaningful reduction in the number of people waiting more than four months to see a specialist (target to be set in government).
· Shorter wait times for surgery – a meaningful reduction in the number of people waiting more than four months for surgery (target to be set in government).
To attract and retain more healthcare workers they have said they will incentivise more people to study nursing and midwifery with a bonding scheme that will pay their student loan for five years if they commit to working in New Zealand. They have said they will establish a relocation support scheme, offering up to 1000 qualified overseas nurses and midwives relocation grants worth up to $10,000 each to support their move to New Zealand. National have pledged to establish a third medical school at the University of Waikato, with satellite training centres in regional areas. They’ve also said they will increase the number of medical school placements at Auckland and Otago by a total of 50 per annum from 2025.
We will be closely following these proposals and will report back as and when things change.
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AIA updates the benefits of its living products
AIA has released a raft of changes updating the benefits that apply to its living products covering critical conditions, progressive care, life cover, and family protection, including changes to selected closed Sovereign, TotalCareMax, AIA Trauma and AIA Life Cover products.
Some of the key changes, which are applicable to new claim events on or after 10 October 2023, include:
· The minimum coverage age for standalone children’s trauma has been lowered from two years to three months.
· Extension of the life buyback reinstatement period from 30 to 60 days.
· Removed the benefit for new business that pays on the diagnosis of medically or occupationally acquired HIV, and introduced a new benefit that pays on the diagnosis of advanced AIDS – regardless of transmission method.
· Changed the terminal illness definition to clarify that life expectancy is less than 12 months, despite all reasonable medical treatment.
· Increased bereavement support benefit from $15,000 to $25,000 in cases where there is joint policy ownership.
· Removed the 5% limit to pay up to $20,000 as an early payment if the life assured dies overseas to return their body to either New Zealand or their home country.
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nib says insurance can help families navigate increasing mental health concerns
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FSC webinar 'Leading Lawyers Australia' 31 October
Jon-Paul Hale believes some providers are asking advisers for too much
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Legal and regulatory update for the life and health insurance sector
12 Oct 2023 - The Australian Prudential Regulation Authority (APRA) and the Australian Securities and Investments Commission (ASIC) have published two joint discussion papers on plans to enhance the data collections for the life and general insurance industries. APRA and ASIC plan to collect more granular data as part of the Insurance Data Transformation (IDT) project, which will enable regulators, policymakers and insurers to undertake a more comprehensive assessment of the risks facing the industries. APRA and ASIC invite written submissions on the discussion questions by 22 December 2023. https://www.apra.gov.au/news-and-publications/apra-and-asic-release-consultation-on-general-insurance-and-life-insurance
13 Oct 2023 - Minister of Commerce and Consumer Affairs, Hon Dr Duncan Webb, September 2023 diary released with no financial services sector related meetings noted https://www.beehive.govt.nz/sites/default/files/2023-10/September%202023%20Proactive%20Diary%20Hon%20Dr%20Duncan%20Webb.pdf
13 Oct 2023 - The Australian Prudential Regulation Authority (APRA) has published its Annual Report for the 2022-23 financial year. https://www.apra.gov.au/news-and-publications/apra-publishes-2022-23-annual-report
Quotemonster Online Training (with tips and tricks)
Over 2,500 Financial Advisers in New Zealand have crunched over 15 million quotes in the last 12 years using Quotemonster, and we invite you to see why!
We welcome you to join our upcoming introductory training session scheduled on Wednesday, 18 October 2023 11:00 am-12:00 pm
In this session, hosted by Kelly, our National Partnerships Lead, we go over the basics of using Quotemonster and how to make the most of your Researchmonster subscription along with:
How to generate a premium comparison between insurers
How to set up your Product and Provider Settings screen
How to directly compare two insurers for replacement business (Head-to-Head)
How to download our detailed comparison and client-friendly benefit overview or heat map report
How to add banks and non-adviser companies to your Research comparison
How to find legacy policy documents
If you would like to register for this session please send us an email on info@quotemonster.co.nz
We look forward to seeing you there!
Research and website upgrades: what you need to know!
QPR Database V15.5 has been released!
Our Research team have made some monstrously good updates to the QPR database recently. If you’ve noticed we’re running a bit slower than usual, please refresh your page and scroll down to ensure that you’re on our latest version – QUOTE ENGINE V.3.0 B1 | QPR V.15.5 | WEB V4.5.1
Our latest updates to Researchmonster include:
- Medical claims model update
o claims scenario increased to $100K
o new benefits added: ‘Child Features’, ‘Skin Lesion Surgery’ and ‘Medical Tourism’
o item removed: ‘Product Flexibility’
o ‘Minor Surgery’ updated to ‘GP Minor Surgery’
- Chubb Life – new policy document for Assurance Extra Business Life, Trauma and TPD effective 26 June 2023
o rating changes applied
o standalone trauma cover added and rated
- Partners Life – TPD item in Trauma updated to optional effective 6 October 2023
- Accuro – new policy document for SmartCare and SmartCare+ effective 1 September 2023
- AIA – new policy document for AIA Living Umbrella, Income, and Mortgage Protection effective 31 July 2023
o rating changes applied to ‘Inflation Adjustment’
- AIA Legacy renamed to AIA Real
Reviews:
- Life Income: re-weight made to ‘Terminal Illness Booster’
- Trauma: remediation to ‘Cancer Benefit Booster’
- Income and Mortgage Protection: remediation to ‘Offsets’
- TPD: ‘TPD Main Cover Definition’ – revisions to make Any Occupation rating scale appropriate when considered alongside Own Occupation ratings
Standalone Head to Head is a powerful tool subscribers can use to:
- Compare legacy products for replacement business – a list of the products available in this feature can be found here
- Compare products from the same provider; e.g., AIA Critical Conditions vs Progressive Care
- Compare different product sets; e.g., Severe Trauma vs Comprehensive Trauma
- Quick research comparisons
Please note this feature is still in Beta version so please reach out to us if you have any feedback that you would like us to consider in our next round of development.
Our latest updates to Advicemonster include:
Business Insurance quoting, research and needs analysis functions for lump sum cover (Life, Trauma and TPD).
You can now produce a Business Statement of Advice (SOA) supported with pricing and research (on lump sum products only). If your organisation would like training on how to produce a Business SOA using Advicemonster, please contact us.
Please note this feature is still in Beta version so please reach out to us if you have any feedback that you would like us to consider in our next round of development.
A highly requested infographic Health Benefit Maximum is now available to Researchmonster and Advicemonster users and is in the Research Tools option in your main menu. This quick reference guide aims to help advisers quickly identify some of the important differences when it comes to health cover benefit maximums. It doesn't include every individual niche benefit that some insurers offer, and some benefits can only be claimed on under specific circumstances (e.g., within 12 months of surgery).
If you have any questions regarding these please feel free to email us on info@quotemonster.co.nz
Happy Crunching!
PWC summarise changes outlined by the CoFI regime
PWC have produced a useful summary of the key changes outlined by Financial Markets (Conduct of Financial Institutions) Amendment Act (CoFI), which was passed on 29 June 2022. License applications opened in July this year and CoFI will come into force in March 2025. The Ministry of Business, Innovation and Employment (MBIE) is working on regulations to support the CoFI regime, which are expected to be released later this year.
In short, the key aspects of the CoFI regime are:
· Promoting good conduct and culture.
· Complying with a set of duties and obligations that help protect customers and promote good conduct.
· Financial institutions need to be licensed by the Financial Markets Authority (FMA) to operate in New Zealand.
· The FMA has increase supervisory and enforcement powers.
· A focus on delivering good outcomes for customers.
Penalties for breaches of CoFI’s regulatory requirements include:
· The FMA taking enforcement action which could include imposing fines, giving directs to take corrective action or taking the institution in breach to court.
· Maximum penalties of $5 million for companies and $500,000 for individuals.
· The FMA could order compensation for customers.
· The FMA could suspend or cancel the licence of a financial institution.
· Reputational damage.
PWC set out a helpful guide of activities you can do now and in future to prepare for COFI. The FMA has information on Fair Conduct Programmes and more detailed information on CoFI, including how to apply for a financial institution licence here.
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nib release 2023 sustainability, community and climate-related disclosure reports
nib Group have released their 2023 sustainability, community and climate-related disclosure reports. Some highlights from the reports include:
· 25,990 HealthChecks were undertaken by nib members.
· Employee Experience Surveys in FY23 found an overall engagement score of 81%.
· 289 staff volunteered 1,546 hours across 14 charities.
· 34 suppliers completed continuous improvement plans to manage modern slavery risk.
· The strategic procurement team has taken a proactive step toward reducing nib’s carbon footprint by introducing environmental criteria into the Request for Proposal (RFP) process.
· nib introduced a new values-based employee recognition program where all employees have the opportunity to nominate their colleagues and vote on the most extraordinary achievements.
· nib worked with Ngāti Whātua Ōrākei to facilitate the ‘Cultural Coalition’ Program (Whatua te Aho Tukurua). This six-week program teaches participants Māori language and values, encouraging employees to integrate these learnings into regular work activities and practices.
· Gender pay equity gap has reduced to 2.75%.
· 985 Kiwis visited Clearhead’s Te Reo Māori website and chatbot
nib has identified climate-related risks including:
· increased market pressure to provide community support and insurance affordability for those experiencing climate hazards;
· increased illness & comorbidity due to chronic and compounding climate change hazard;
· trauma, illness, property destruction and disruption leading to high rates of psychological distress;
· increased incidents and severity of climate hazards causing pressure on discretionary income;
· chronic and compounding climate change impacts putting pressure on health services;
· energy and emissions performance standards creating compounding capital expenditure and operational costs;
· limitations of current regulatory and pricing mechanisms to respond to climate hazards;
· risk nib won’t meet growing mandatory reporting and regulatory requirements.
nib has developed a risk-management framework to manage and mitigate its material risks, and their board and management regularly identify and analyse risks and the effectiveness of the controls in place to manage these risks.
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