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.
Nick Astwick explains how Southern Cross Health Society remains economically sustainable
Nick Astwick, chief executive at Southern Cross, has spoken about how Southern Cross Health Society remains economically sustainable. He details the three key things that the not-for-profit friendly society relies on to keep it sustainable.
Nick Astwick, chief executive at Southern Cross, has spoken about how Southern Cross Health Society remains economically sustainable. He details the three key things that the not-for-profit friendly society relies on to keep it sustainable:
· Young and healthy members - Astwick talks about how having younger, healthier members keeps claims down.
· Prevention – a focus on preventing sickness from happening, like a pilot programme the Health Society is running that offers bowel cancer screening.
· Membership growth and retention – ensuring affordable coverage and accessible benefits to help maintain tenure.
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Swiss Re release report on the global economic and insurance market
Partners Life "Last Performance” campaign wins at Agency of the Year awards
The FSC welcome the incoming government
Southern Cross Health Society Annual General Meeting 6 December
Asteron Life customers can score a $50 Prezzy card for every $500 in new premium, up to $5000
MAS webinar 'Financial wisdom for a purposeful retirement' 5 December
Sharesies has launched its KiwiSaver scheme to the general public
David Green says mortgage lending should be taken out of the CCCFA and given its own legislation
Chubb has appointed Adit Witjaksono as property manager for Australia and New Zealand
FintechNZ Annual Meeting 2023 rescheduled to 6 December
Legal and regulatory update for the life and health insurance sector
30 Nov 2023 - The Financial Markets Authority (FMA) has signed a Consultation Agreement with The Financial Markets Standards Board (FMSB) which formalises cooperation between the FMA and FMSB. https://www.fma.govt.nz/news/all-releases/media-releases/agreement-signed-by-fma-and-fmsb/
4 Dec 2023 - The Reserve Bank of New Zealand will fund trials which will test new ways for people, including retailers, to withdraw and deposit cash, including change and takings, at little or no cost to them. https://www.rbnz.govt.nz/hub/news/2023/11/reserve-bank-community-cash-trials-to-start-next-year
4 Dec 2023 - FMA releases ‘5 mins with the FMA’ podcast #10: What is outcomes focused regulation? https://www.fma.govt.nz/library/podcast/5-mins-with-the-fma-podcast-10-what-is-outcomes-focused-regulation/
4 Dec 2023 - The Australian Securities and Investments Commission (ASIC) and Australian Financial Complaints Authority (AFCA) have signed a memorandum of understanding (MoU) setting out how they will continue to work together to support a fair and efficient financial services sector. https://asic.gov.au/about-asic/news-centre/news-items/asic-and-afca-sign-memorandum-of-understanding/
Australia’s Federal Government seeks feedback on the use of genetic test results by insurers
Australia’s Federal Government has opened consultation on the impacts of life insurers utilising genetic test results in underwriting.
Under the Insurance Contracts Act 1984 consumers have a responsibility to provide information requested by life insurers, including any genetic testing results. In 2018, a report by the Parliamentary Joint Committee on Corporations and Financial Services identified concerns that life insurers using genetic tests in underwriting was negatively impacting participation in health research projects involving genetic testing.
In 2019, Australia’s life insurance industry introduced a partial Moratorium on the requirement to disclose genetic testing results. Life insurers could only request or use the results of a genetic test if the total amount of cover a person has exceeded set thresholds. The Moratorium also stated that life insurers would not require or encourage applicants to take a genetic test as part of the application. The Moratorium was introduced due to concerns that people would not undergo genetic testing for personal health reasons or participate in medical research that involved genetic testing because they feared that it could negatively impact their ability to obtain affordable life insurance.
A report by researchers at Monash University investigating the impact of the Moratorium found it is discouraging consumers from participating in clinical genetic testing and in medical research which involves genetic testing. The report also found that life insurers were not complying with the Moratorium, and were asking applicants about genetic test results when the applications fell below the financial thresholds. The report also deemed the financial limits were too low. The report’s recommendations include the Government amending legislation to prohibit insurers from using genetic or genomic test results to discriminate between applicants for risk-rated insurance and that the Government consider ensuring insurers are subject to a positive duty to not discriminate. Consultation is open until 31 January 2024.
We spoke to Russell Hutchinson to get a New Zealand perspective on this issue:
Currently New Zealand has no legislated approach to genetic testing. There are similar consumer movements to that in Australia, which highlight the risks to consumers and their families when they delay obtaining genetic tests because they are concerned about the impact on their ability to obtain insurance coverage. A good synopsis of this from the medical viewpoint is given in this Radio New Zealand piece. It does not discuss the value of having a functioning insurance sector or examine how this relies on the ability to charge different premiums for different risks or in some cases, decline to insure a person. Naomi Ballantyne offers a succinct summary of an underwriter’s perspective in this article at Good Returns.
Occasionally, consumer fears may drive choices which are also damaging to the insurance market – for example, delaying a test to take out coverage and then lapsing the coverage if the test results show no increased likelihood of developing the condition. There may be value in offering some form of reassurance to consumers to limit the impact of genetic testing on insurance. Personally, right now, I would encourage anyone contemplating a genetic test to place their health first and obtain the test.
The Financial Services Council (FSC) regularly reviews its stance and industry guidelines on genetic testing to ensure they reflect best practice globally; they have reiterated that it is important insurers understand a customer's risk profile as part of the underwriting process.
"Some insurers may ask customers to disclose known information about the results of their genetic tests. This is consistent with asking customers other questions about their risk profile - for example, their family history.”
"Genetic testing is not something that any of our members ask their customers to carry out. Overall, FSC believes a fair position is one that balances the interests of consumers and the medical community to advance genetic science, and which manages financial risks to insurers and all policyholders."
Recently the FSC has held a discussion group with representatives from the insurance industry and the medical community to discuss the challenges that genetic testing present. A working group has been established to improve outcomes from genetic testing. Currently, RiskInfoNZ is running a poll to find out if people will see a time when genetic tests will play a part in clients applying for life insurance.
More daily news:
Gold Band Finance is the first non-bank deposit taker to get an FMA Financial Institution Licence
Proposed changes to the NZCFS Level 5 will be published on the Ringa Hora website early next year
AMP settles with Australian financial advisers for A$100 million
AMP has settled a legal dispute with hundreds of Australian financial advisers affected by unilateral changes to buyer-of-last-resort (BOLR) terms.
AMP has settled a legal dispute with hundreds of Australian financial advisers affected by unilateral changes to buyer-of-last-resort (BOLR) terms. After a long-running legal dispute AMP has settled, with no admission of liability, for A$100 million.
In August 2019 AMP made unilateral changes to adviser contracts that meant BOLR multiples were cut by almost 40%, from 4 times recurring revenue to 2.5 times (excluding grandfathered commissions).
In July an Australian Federal Court decision found AMP erred in altering the buyer-of-last-resort terms for two advice businesses operating under its brand. Justice Moshinsky ruled in favour of the two Australian advisory firms who bought suit, awarding Equity Financial Planners A$813,000 and Wealthstone A$115,000 and opening AMP up to 120 or more similar claims. AMP lodged an appeal in October but opted to settle following a mediation process in November.
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Jon-Paul Hale questions whether non-smoker rates are non-smoker rates
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$100 million programme for specialist mental health services is behind schedule
Advicemonster users can access business insurance!
Our latest update to Advicemonster adds business insurance.
Advicemonster Business Insurance beta now includes quoting, research, and needs analysis functions business for lump sum covers (Life, Trauma and TPD).
This means you can now produce a Business Statement of Advice (SOA) supported with pricing and research (on lump sum products only). If you or others in your organisation would like training on how to produce a business statement of advice (SOA) using Advicemonster, please email your request to aneel.ravji@qpresearch.co.nz
The next products on our radar are Key Person, Rural Cover and Business Expenses, and they are coming soon - so keep an eye out for more information on this. Also, if you’re an expert on these products and would like to provide us with some insight, please reach out to us on researcher@qpresearch.co.nz
Legal and regulatory update for the life and health insurance sector
27 Nov 2023 - APRA embarked on a multi-year pilot study with a selection of banks to gain insights into the status of data risk management. They have outlined their findings and highlight multiple areas where all APRA-regulated entities can improve their data management practices. https://www.apra.gov.au/news-and-publications/quality-data-as-an-asset-for-boards-management-and-business
28 Nov 2023 - The Financial Markets Authority (FMA) has cancelled Foundation Advice Limited (FAL)’s Financial Advice Provider (FAP) licence. FAL was an Auckland-based FAP offering advice on life and health insurance as well as KiwiSaver. The High Court put FAL into liquidation on 26 October 2023 following an application filed by the Inland Revenue Department. https://www.fma.govt.nz/news/all-releases/media-releases/fma-cancels-foundation-advice-limiteds-licence/
28 Nov 2023 - ASIC has issued guidance to financial advisers and Australian financial services (AFS) licensees about the new requirement for financial advisers to be registered. From 1 February 2024, financial advisers who provide personal advice to retail clients on relevant financial products must be registered with ASIC. https://asic.gov.au/about-asic/news-centre/news-items/asic-releases-guidance-on-the-registration-of-financial-advisers/
28 Nov 2023 - The FMA has agreed in principle to grant a class exemption for five years for each Climate Reporting Entity (CRE) which is in liquidation, receivership or voluntary administration from the duties in Part 7A of the FMC Act, comprising:
full relief for a CRE which is in liquidation (solvent or insolvent) and for managers that are CREs in respect of a registered scheme (or fund within a scheme) that is in wind-up.
deferral relief for up to two years for CREs in receivership or voluntary administration.
The effect of full relief is that the climate reporting duties are cancelled. The effect of deferral relief is that climate reporting duties are deferred but must still be complied with at a later date.
Fidelity Life launch a range of product enhancements
Fidelity Life launch six product enhancements to the market in response to adviser feedback.
Fidelity Life launch six product enhancements to the market in response to adviser feedback.
· Monthly mortgage repayment - cover benefit percentages have increased from 110% to 115% of mortgage repayments and 40% to 45% of income.
· Special events and Future insurability – new triggers have been added to Special events as reasons for optional cover increases such as buying investment property, land, holiday home, co-signing a child’s mortgage or supporting a child with fulltime tertiary study. In addition, some exclusions for Special events and Future insurability (i.e., for customers with loadings or special terms) have been removed to give a wider range of customers access to these benefits.
· Key person new to business and Key person for farmers - monthly cover limits have increased from $4,000 to $6,500 for Key person new to business, and from $5,000 to $9,000 for Key person for farmers covers.
· Repatriation benefit – now available on applicable life covers, the newly added benefit is on top of the life cover sum insured and is accessible to repatriate a body home from or to New Zealand.
· Stand-down period commencement - the stand-down period for specified trauma conditions have been adjusted for new covers to start on the date of a completed application submission, not on underwriting.
· Increased sum insured limits for children – new limits for children now stand at $250,000 for both Life cover and Trauma cover - standalone.
More daily news:
AIA extend One Month’s Premium Free offer to 30 November 2023
Apple Watch Benefit is back in the AIA Vitality app as an option for AIA Vitality members to earn
From 9 November 2023, AIA have made some adjustments to loadings for BMI
Asteron Life and AIA awarded at the ANZIIF NZ Insurance Industry Awards
The Australian and New Zealand Institute of Insurance and Finance (ANZIIF) held the 11th New Zealand Insurance Industry Awards on 22 November. Asteron Life were awarded the Life Insurance Company of the Year award. AIA were recognised as winners of the Excellence in Workplace Diversity and Inclusion (D&I) and Excellence in Environmental, Social and Governance Change categories.
The Australian and New Zealand Institute of Insurance and Finance (ANZIIF) held the 11th New Zealand Insurance Industry Awards on 22 November.
Asteron Life were awarded the Life Insurance Company of the Year award. It is the fourth time they have won this award, having also won it in 2013, 2014 and 2021. Judges were impressed by Asteron Life’s Voice of Customer program, which provides insights into the customer experience; their high customer satisfaction scores overall; their policy wordings being accredited with the WriteMark standard; and attention to helping customers with affordable levels of cover. In particular the judging panel praised the variety of customer and people initiatives Asteron Life have implemented, ranging from Connected Care to Kids Cover to a Professional Supervision Programme.
AIA were recognised as winners of the Excellence in Workplace Diversity and Inclusion (D&I) and for Excellence in Environmental, Social and Governance Change. At AIA all leaders are expected to take responsibility for DE&I measures in recruitment, development, remuneration and the overall workplace environment. AIA recently achieved the Accessibility Tick and implemented a Menopause Tookit initiative. AIA has a five-pillar ESG strategy that incorporates sustainable operations, investment, health and wellbeing, people and culture and effective governance. They have committed to being net zero by 2050 and have already put in place many actions to work towards that goal, including new buildings aligning with green standards. They are committed to ethical investment and have a co-created employee wellbeing strategy in place.
More daily news:
Fidelity Life are holding three Adviser practice manager and admin summits across NZ in February
Fidelity Life are accepting registrations of interest for Adviser Edge 2024
Fidelity Life's last commission run for 2023 is 28 December
Southern Cross announce winners of the 2023 Southern Cross Health Insurance Wayfinder Awards
ASB launch two new Aggressive Funds
Pinnacle Life voted Most Trusted Online Life Insurance Company
Graeme Edwards takes on role of Lifetime Group director and chairman
FSC circulate submission template for feedback on FMA's approach to outcomes focused regulation
Legal and regulatory update for the life and health insurance sector
21 Nov 2023 - The Australian Prudential Regulation Authority (APRA) has released its Quarterly Superannuation Performance publication and the Quarterly MySuper Statistics report for the September 2023 quarter. https://www.apra.gov.au/news-and-publications/apra-releases-superannuation-statistics-for-september-2023
21 Nov 2023 - The Financial Services Council has today released its initial report outlining the challenge to update the permitted operating model for defined benefit (DB) workplace savings schemes by enabling them to consolidate, thereby benefiting both members and employer sponsors through improved cost-effectiveness and simpler administration. https://blog.fsc.org.nz/media-release-21-november-2023
22 Nov 2023 - The Australian Prudential Regulation Authority has released its quarterly private health insurance (PHI) publication for the September 2023 quarter. https://www.apra.gov.au/news-and-publications/apra-releases-quarterly-private-health-insurance-statistics-for-september-5
22 Nov 2023 - The Australian Prudential Regulation Authority (APRA) has released a response to consultation on its proposed amendments to three private health insurance (PHI) reporting standards, following amendments to PHI legislation. https://www.apra.gov.au/news-and-publications/apra-responds-to-consultation-on-amendments-to-private-health-insurance
23 Nov 2023 - The Privacy Commissioner has announced that his Office will be consulting on new rules specifically for biometrics. Biometrics are increasingly collected by facial recognition technology (FRT), retinal scans, and voice recognition. The exposure draft will be released early in 2024 and will be available for everyone to comment on. https://privacy.org.nz/publications/statements-media-releases/privacy-commissioner-to-consult-on-new-rules-for-biometrics/
24 Nov 2023 - FMA released its Audit Quality Monitoring Report for 2022/23 https://www.fma.govt.nz/library/reports-and-papers/audit-quality-review-report/
27 Nov 2023 - Medical Assurance Society (MAS) are to pay a $2.1 million penalty for making false and misleading representations to customers, following proceedings brought by the FMA. In September 2023, MAS admitted it breached section 22, one of the Fair Dealing provisions of the Financial Markets Conduct Act 2013 (FMCA), by failing to correctly apply multi-policy discounts and no claims bonus discounts to some customers who were entitled to them, failing to correctly apply inflation adjustments on some customer policies, and miscalculating benefit payments. https://www.fma.govt.nz/news/all-releases/media-releases/medical-assurance-society-to-pay-2-1-million-penalty/
27 Nov 2023 - The Australian Prudential Regulation Authority (APRA) has released for consultation a new cross-industry standard to centralise APRA's existing standards on definitions for authorised deposit-taking institutions and general, life and private health insurers. https://www.apra.gov.au/news-and-publications/apra-consults-on-new-cross-industry-standard-to-centralise-existing-standards
Te Whatu Ora to roll out 24/7 telehealth primary care service in rural areas
Te Whatu Ora are rolling out a new telehealth primary care service aimed at supporting rural health staff and improving access for patients living rurally.
Ka Ora Telecare, a partnership between Reach Aotearoa, Practice Plus and Emergency Consult, is partnering with general practices in rural areas to deliver the telehealth service. The aim is to support practices by creating extra capacity, including providing overnight support and taking on overflow patients during usual hours. The service should also help redirect patients from emergency departments outside of practice hours.
The service is subsidised by Te Whatu Ora, with free nurse consultations and co-payments for GP consultations.
More daily news:
Financial advisers criticise FMA's withdrawn campaign
The Workforce Development Council puts together the working group involved in the NZCFS review
Southern Cross Health and Life insurance win gold at the Reader's Digest Quality Service Awards 2024
Suncorp New Zealand’s employees raise over $340,000 for charities
ANZ's economists lower their OCR forecast; no longer expect RBNZ to hike above 5.50% in February
RBNZ’s Household Expectations Survey finds kiwis expect inflation to fall slowly