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.
WHO warns loneliness is a pressing global health threat
The World Health Organisation (WHO) has proclaimed that loneliness is a pressing global health threat. The WHO has launched a three-year commission that will attempt to shape global policy by analysing high-risk areas of social isolation and encouraging government to foster new mental health solutions.
The World Health Organisation (WHO) has proclaimed that loneliness is a pressing global health threat. The WHO has launched a three-year commission that will attempt to shape global policy by analysing high-risk areas of social isolation and encouraging government to foster new mental health solutions.
Research shows that social isolation and loneliness can have serious impacts on older people’s physical and mental health, quality of life and longevity. Lonely and socially isolated elderly people are at higher risk of cardiovascular disease, stroke, diabetes, cognitive decline, dementia, depression, anxiety and suicide. Loneliness can have comparable effects on mortality as other risk factors such as smoking, obesity and physical inactivity, with a 2015 meta-analysis found that people with chronic loneliness had a 26% increased risk of mortality. While more often experienced by people of an older age, young people are at risk too, with an estimated 5% to 15% of adolescents experiencing loneliness.
The issues presented by loneliness and social isolation are getting more recognition by those in leadership, with the United Kingdom appointing a ‘loneliness minister’ in 2018 and Japan following suit in 2021.
The WHO suggest a range of individual, community-level and societal-level strategies and interventions that can help reduce social isolation and loneliness. Suggestions range from social skills training and social activity groups at the individual level to improving infrastructure such as transport to creating laws and policies that address social cohesion and socio-economic inequality.
If you’re experiencing loneliness there are a range of organisations that can offer you help.
Financial advisers’ mental health and wellbeing has improved, though still worse than the average NZ worker
AIA NZ has released a report looking into financial advisers’ health and wellbeing, following on from the research they sponsored in 2021. While overall wellbeing showed signs of improvement, stress was still a concerning factor.
AIA NZ has released a report looking into financial advisers’ health and wellbeing, following on from the research they sponsored in 2021. While overall wellbeing showed signs of improvement, stress was still a concerning factor. In 2021, government regulation was the highest cause of stress for advisers (61%); this year’s highest stressor was compliance, with 50% of respondents rating it as ‘highly’ or ‘very highly’ stressful. In both years, work overload was the second most stressful issue (at 42.2% in 2021 and 36.7% in 2023).
The number of advisers who have said they will continue in the industry has increased significantly, up to 93% from 84% in 2021. Work life balance has improved, with 37.2% of those surveyed working 35 to 40 hours per week and 8% less working over 50 hours per week compared to 2021.
The report includes a breakdown of where advisers spend their time, showing the wide variety of tasks that make up an adviser’s job. Only 12.23% of their time is spent on actually providing advice.
Recommendations for improving wellbeing and mental health include: seek help from industry support services; be an active member in networks; engage in recovery activities like exercise, meditation, hobbies, social activities; seek admin help to free up time to focus on client work; use systems that automate processes; get support from counsellors or psychologists when experiencing mental stress; minimise crossovers between work and home; and focus on the business.
Sharron Botica, AIA NZ Chief Partnership Distribution Officer, says
“…it’s encouraging to see signs of improvement across the board, however, the impact that stress is having on adviser health and wellbeing is a concerning factor which needs to be addressed,”
“We believe our role as leaders in the industry is to ensure our advisers have the tools and support to be mentally healthy, focus on their wellbeing, and have the opportunity to thrive and do what they do best every day.”
The research was conducted by Dr Adam Fraser, founder of The e-lab, and Dr John Molineux from Deakin University and participants included life and health insurance advisers, business owners, home loan advisers, investment advisers, risk advisers, sole trader advisers, and general advisers, aged 18 to over 60, who were either qualified, partly-qualified, or unqualified.
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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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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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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 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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FSC release Money & You: Young People and the Cost of Living report
The Financial Services Council (FSC) have released ‘Money & You: Young People and the Cost of Living’ report. The report found that Gen Z and millennials had lower levels of financial wellbeing, financial literacy and financial confidence than older respondents. Some of the key findings from the report include:
Mental health and wellbeing is the number one health concern for both Gen Z (78%) and millennials (52%), with nutrition coming in second place and oral/dental health coming in third place.
61% of Gen Z and 52% of millennials worry about money daily or weekly, compared to only 29% of baby boomers.
Buy now, pay later (BNPL) and personal loans are more likely to cause Gen Z and millennials issues than other age ranges.
Only 42% of Gen Z and 51% of millennials would be able to access $5,000 in a time of emergency without going into debt.
41% of Gen Z and 58% of millennials feel very or somewhat confident about planning for their retirement despite 74% of Gen Z and 61% of millennials not having calculated how much money they need in retirement. 45% are contributing the minimum 3% to their KiwiSaver.
52% of Gen Z and 72% of millennials feel very or somewhat confident about choosing an insurance policy. 28% have life insurance, 13% have income protection insurance, 31% have health insurance, 7% have total and permanent disablement insurance and 11% have trauma or critical illness insurance.
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PWC publish New Zealand Workforce Hopes & Fears Survey 2023
PWC have published their New Zealand Workforce Hopes and Fears Survey 2023, exploring views on business viability, worker sentiment, workforce skills, emerging technology, work environment and climate action. 1,000 respondents shared their views and in general, kiwis were more optimistic than others Asia Pacific countries, with 72% believing that their employer will still be in business in the next decade.
New Zealanders were consistent with the rest of Asia Pacific in terms of 57% of both areas being very or moderately satisfied with their jobs, however kiwis were less likely to ask for a pay rise (37% vs 43%), ask for a promotion (23% vs 38%) or change employer (20% vs 28%).
Only 25% of kiwis believed the skills for their job would change significantly in the next 5 years (versus 44% of those in the Asia Pacific region). In terms of technology, kiwis seem to think AI will be less disruptive and provide less opportunities than Asia Pacific respondents: 35% don’t think AI will impact their jobs, much higher than Asia Pacific as a whole at 16%; 22% believe AI will help them increase their productivity/efficiency at work (vs Asia Pacific 41%); only 18% think AI will create opportunities for them to learn valuable new skills (vs Asia Pacific 34%); only 12% believe AI will create new job opportunities for them (vs Asia Pacific 25%); and 44% think that digital skills are important to their career (vs. Asia Pacific 59%).
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Southern Cross financial results released
Southern Cross Health Society have released their financial results for the year ended 30 June 2023.
$1.466 billion premium revenue
$1.295 billion paid out in claims – equal to paying 88.4 cents in claims out of every dollar received in premiums (compared to an industry average of 65.9 cents)
Premium prices were up approximately 5.1% compared to the previous year
Southern Cross Health Society had a $5.4 million deficit, while the wider Southern Cross Health Society Group had a deficit of $16.5 million
Group reserves (net assets) of $597.3 million
Paid $3.4 million claims
99% of claims are now being submitted electronically
Membership grew by 31,929 to reach 940,105 members
223 businesses buying health insurance on behalf of their employees joined this year
Southern Cross makes up 60% of NZ’s health insurance market
More than 20,000 members accessed virtual appointments via CareHQ, more than double the year prior
Members accessed 6,912 online mental health sessions with Raise, 6,324 annual health checks with MedPro and 20,663 virtual GP consultations delivered via CareHQ
Employee engagement score of 82%
Nick Astwick, Chief Executive, commented on Southern Cross’ goals around keeping premiums affordable and helping members lead healthier lives.
“…the affordability of their premiums is critical. So, we’re going to do a little bit more in prevention rather than just treatment. You’re going to see us be a lot more active with our members and our healthcare providers to prevent high-cost things from happening earlier in the cycle and actually have more affordability options.”
“Also one thing we are going to focus a lot more on in the coming years is making our members aware of how they can live healthier lives and not just be there when they’re sick. So, you’ll see a lot more from Southern Cross around trying to increase the health span – the number of years you have that are healthy – and making our members aware of that.”
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