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.
Legal and regulatory update for the life and health insurance sector
The Accident Compensation (Interest on Instalment Plans) Amendment Bill read a third time; FMA hold Q&A sessions on CoFI; FMA hold online session on how to apply for a financial institution licence; FMA publish their Statement of Intent and Statement of Performance Expectations.
25 Jun 2024 - The committee stage of the Accident Compensation (Interest on Instalment Plans) Amendment Bill was completed and The Accident Compensation (Interest on Instalment Plans) Amendment Bill was read a third time. https://bills.parliament.nz/v/6/00103c69-0b28-4ad1-a702-08dc80370942
26 Jun 2024 - The FMA are holding two Q&A session on CoFI fair conduct programmes on 3 & 9 July. https://www.eventbrite.com/cc/qa-session-on-cofi-fair-conduct-programmes-3444339
26 Jun 2024 - The FMA are holding an online session on how to apply for a financial institution licence on 24 July. https://www.eventbrite.co.nz/e/how-to-apply-for-a-financial-institution-licence-tickets-929411062507?aff=oddtdtcreator
26 Jun 2024 - The FMA have published their Statement of Intent and Statement of Performance Expectations. The Statement of Intent sets out how they will do their work, what they will deliver, and how they will measure progress over the next four years. The Statement of Performance Expectations sets out their performance targets for the financial year ahead and includes several new measures focused on guidance, engagement, and the delivery of streamlined systems. https://www.fma.govt.nz/library/corporate-publications/statement-of-intent/
Legal and regulatory update for the life and health insurance sector
Office of the Privacy Commissioner asks for submissions on guidance; RBNZ activates DTI restrictions; FMA holds webinars on how to apply for a COFI licence and how to submit FAP regulatory returns; FMA publish findings from monitoring FAPs; The Accident Compensation (Interest on Instalment Plans) Amendment Bill was introduced to Parliament; APRA emphasise importance of data backups; CEO of the External Reporting Board resigns; COFR release latest Quarterly Statement; RBNZ releases dates for Monetary Policy Statement publication; Commerce Commission files criminal charges against Kiwibank
22 May 2024 - The Office of the Privacy Commissioner asks for submissions on new guidance, Poupou Matatapu – doing privacy well. https://privacy.org.nz/news/consultations/poupou-matatapu/
28 May 2024 - The Reserve Bank of New Zealand - has confirmed the activation of Debt-to-Income (DTI) restrictions and loosening of Loan-to-Value Ratio (LVR) restrictions. https://www.rbnz.govt.nz/hub/news/2024/05/reserve-bank-activates-debt-to-income-restrictions
30 May 2024 - The Financial Markets Authority is holding a webinar on how to apply for a CoFI licence at 11am on 5 June. To attend, email cofi@fma.govt.nz
30 May 2024 - The Financial Markets Authority publish findings from the FMA’s supervision activities and monitoring of Class 1 and 2 licensed financial advice providers. https://www.fma.govt.nz/news/all-releases/media-releases/fap-monitoring-insights-report/
30 May 2024 - The Financial Markets Authority is holding a series of online sessions to help Financial Advice Providers submit their FAP regulatory returns.
Session 1 - Friday 14 June 2024 at 9am
Session 2 - Monday 24 June at 2pm
Session 3 - Monday 08 July at 10am
Session 4 - Tuesday 16 July at 10am
30 May 2024 - The Accident Compensation (Interest on Instalment Plans) Amendment Bill was introduced to Parliament https://bills.parliament.nz/v/6/00103c69-0b28-4ad1-a702-08dc80370942?Tab=history
3 Jun 2024 - The Australian Prudential Regulation Authority (APRA) has written to all APRA-regulated entities emphasising the critical role of data backups in cyber resilience. The letter details the common issues observed in backup practices that could hinder system restoration during an incident. APRA expects regulated entities to review their backup arrangements and address any identified gaps promptly. https://www.apra.gov.au/news-and-publications/apra-clarifies-expectations-on-cyber-security-and-adequacy-of-backups
4 Jun 2024 - The Chief Executive of the External Reporting Board (XRB), April Mackenzie, has resigned. https://www.xrb.govt.nz/news/latest-news/
7 Jun 2024 - The Council of Financial Regulators release their Quarterly Statement for June 2024. Kris Faafoi joined the meeting to discuss the insurance sector’s priorities, risks, and challenges. The conversation covered three priority areas: 1) insurance affordability; 2) resilience; and 3) the regulatory environment. https://www.cofr.govt.nz/news-and-publications/quarterly-statement-by-cofr-june-2024.html
11 Jun 2024 - The Reserve Bank of New Zealand has released the dates for publication of its quarterly Monetary Policy Statement, Monetary Policy Review decisions and the 6-monthly Financial Stability Report. The new dates cover the period from August 2025 to July 2026. https://www.rbnz.govt.nz/hub/news/2024/06/monetary-policy-announcement-and-financial-stability-report-dates-for-late-2025-and-2026
11 Jun 2024 - The Commerce Commission has filed criminal charges against Kiwibank Limited (Kiwibank), alleging systemic breaches of the Fair Trading Act. The breaches relate to issues that resulted in more than $7 million being incorrectly charged to over 36,000 customers for fees and interest rates in relation to home loans, credit cards and overdrafts, over a period of several years. https://comcom.govt.nz/news-and-media/media-releases/2024/kiwibank-faces-criminal-charges-following-issues-that-caused-over-$7m-in-overcharges
Legal and regulatory update for the life and health insurance sector
2 Apr 2024 - The Reserve Bank has announced two new members of its Monetary Policy Committee (MPC). Carl Hansen and Prasanna Gai are set to join the set-member MPC responsible for the crucial monetary policy decisions that uphold price stability in New Zealand. Hansen began his tenure April 1, succeeding Peter Harris. Gai will start on July 1, taking over from Caroline Saunders. https://www.beehive.govt.nz/release/reserve-bank-appointments
2 Apr 2024 - The Reserve Bank of New Zealand has welcomed progress on whenua Māori lending. The Māori Land Court recently released a practice note in regard to lending on Māori freehold land - whenua Māori. The note provides guidance to assist landowners, lawyers and the banking sector with lending against Māori freehold land. https://www.rbnz.govt.nz/hub/news/2024/04/rbnz-welcomes-progress-on-whenua-maori-lending
2 Apr 2024 - The Financial Markets Authority is considering a class exemption that would allow listed companies to bring certain green, social, sustainable, and sustainability-linked (GSSS) bonds to market more quickly and without incurring most of the regulatory costs of a full retail investment offer. This would operate on a similar basis to the same class exclusion available in the Financial Markets Conduct Act 2013 (FMC Act), that allows companies that are already-listed to raise further capital using simple, streamlined disclosure. Submissions close 30 April 2024. https://www.fma.govt.nz/business/focus-areas/consultation/consultation-proposed-exemption-for-certain-green-social-sustainability-and-sustainability-linked-bonds/
2 Apr 2024 - Changes to ACC’s Accredited Employers Programme (AEP) aim to deliver a better experience for businesses and workers whose work injury claims are handled by the organisation directly, rather than through ACC. Accredited employers will be given better insights into their performance, more support and guidance to help them improve their worker’s experience as well as injured workers being better supported by their employers.
The changes focus on 4 areas:
Claims and injury management assessment: An improved assessment of the claims and injury management that also better captures workers’ experience and remove unnecessary compliance.
Performance monitoring: A new performance monitoring model that will give accredited employers access to clear and up-to-date information on their performance, the ability to lift performance, and incentives to perform better.
New health and safety assessments: An updated ACC health and safety audit process and a new option of ISO 45001 certification will drive higher quality health and safety systems.
Updated pricing options: More choices under the Partnership Discount Plan, enabling employers to take on longer claims management periods, providing workers with complex injuries greater assurance and more continuity of support.
The changes will take effect from 1 April 2025, with 1 years notice, so accredited employers and ACC have time to prepare and adapt their processes and systems.
https://www.mbie.govt.nz/about/news/final-changes-to-accs-accredited-employers-programme-confirmed/
2 Apr 2024 - The Reserve Bank of New Zealand publish an op-ed by Reserve Bank Governor Adrian Orr. https://www.rbnz.govt.nz/hub/news/2024/04/rbnz-op-ed-on-cofr
Fidelity Life and Kaplan Professional join together to deliver Career Connect training
Fidelity Life has partnered with Kaplan Professional to deliver their Career Connect financial adviser training programme. Kaplan Professional will join as the programme’s education provider, in conjunction with Massey University.
Fidelity Life has partnered with Kaplan Professional to deliver their Career Connect financial adviser training programme. Kaplan Professional will join as the programme’s education provider, in conjunction with Massey University. Kaplan Professional will fund a new Women in Finance Scholarship, to join Fidelity Life’s existing six scholarships.
Applications are open for Career Connect’s 2024 intake, with 30 places, including 7 scholarships, available. The programme runs from May until December 2024.
The scholarships available are:
Women in Finance scholarship brought to you by Kaplan Professional, designed to assist female applicants to become financial advisers
Rural scholarship brought to you by FMG, designed for applicants with a rural connection
Pounamu scholarship, designed to assist Māori applicants
Kōwhai scholarship, designed to assist Pasifika applicants
Rāngi Po scholarship, designed to support underrepresented identities in our industry.
Toe Toe scholarship, designed to recognise outstanding young applicants.
Pāua scholarship, designed to recognise outstanding applicants who demonstrate excellence.
Kaplan Professional CEO Brian Knight said
“Programs like Career connect provide the ideal launchpad for a bright future in financial advice, so we are delighted to collaborate with Fidelity Life on what we believe is a terrific initiative to strengthen New Zealand’s talent pipeline.”
“We also remain steadfast in our commitment to encouraging and promoting diversity within the industry, so we are thrilled to be able to provide a scholarship for women in every intake of the program.”
There is a free online career evening on March 19 where those interested can find out more about becoming a financial adviser, what being a financial adviser is really like and how Career Connect can support you to gain the qualifications and skills necessary to become a successful financial adviser.
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Climate change and what it means for health and life insurance
The ‘Climate Change: What does the future hold for health and life insurance?’ report digs into the impact of climate on health and life insurance products and how availability, structure and pricing might be affected in future.
The Geneva Association and Wellcome have released ‘Climate Change: What does the future hold for health and life insurance?’ report. The report digs into the impact of climate on health and life insurance products and how availability, structure and pricing might be affected in future.
Estimates for those that live in climate-vulnerable locations across the world are approximately 3.3 – 3.6 billion people. Estimates for death directly attributable to climate change vary widely, from 250,000 to 3.4 million deaths annually.
While the short-term consequences for life and health insurers have so far been modest, the increasing frequency and severity of climate events may escalate the impact on insurers. Adverse health outcomes from climate change range from immediate to long-term and cover everything from injuries and fatalities resulting from extreme weather events to heat-related illnesses to disruption of ecosystems reducing crop yields and spreading vector-borne diseases to new regions. In addition, social unrest, displacement and economic hardship can all lead to negative health outcomes.
The report classifies climate-related risks into four categories:
Acute: risks that stem from the impacts of extreme heat, wildfires, floods and severe storms on mortality and morbidity.
Chronic: risks that emerge from prolonged exposure to adverse climate and environmental patterns.
Transitional: risks arising from transition to new technologies or climate transition policies.
Litigious: health-related legal challenges arising from the negative externalities of climate change.
The report calls out the lack of data that can be used to map climate events and patterns against incidences of mortality or morbidity and calls for insurers to resolve the actuarial gaps in understanding.
Those interviewed across 17 global health and life insurance companies agreed that prevention is key to preserving insurability – through things like underwriting that incentivises greener lifestyles and coordination on early warning systems.
“Most respondents do not perceive climate change as exerting any immediate impact on the liabilities associated with H&L insurance, nor do they anticipate short-term consequences for insurability and affordability. Nevertheless, there is consensus that this could change over the long term, although the level of impact may be tempered by multiple factors.”
The report has three key recommendations for insurers: assemble data prospectively to better understand areas of vulnerabilities; invest in innovation; play a bigger role in the policy environment and help strengthen public understanding.
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Te Whatu Ora approves funding that will allow for 1,000 more PET-CT scans a year
Legal and regulatory update for the life and health insurance sector
15 Feb 2024 - Income Tax (ACC Payments) Amendment Bill introduced into Parliament. https://bills.parliament.nz/v/6/37fe42b5-8ae1-47f8-408e-08dc2dc25b35?Tab=history
16 Feb 2024 - The RBNZ have published Adrian Orr's speech on the Monetary Policy Remit and 2% inflation delivered at the 2024 Economics Forum at The University of Waikato. https://www.rbnz.govt.nz/hub/news/2024/the-monetary-policy-remit
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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Jon-Paul Hale believes some providers are asking advisers for too much
ACC fund slips from ‘responsible investment leaders’ to ‘responsible investors’
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Suncorp New Zealand made an after-tax profit of $115m for the year to 30 June
Suncorp New Zealand made an after-tax profit of $115m for the year ended 30 June 2023. This was down 30% compared to the previous year.
Asteron Life performed well, making a profit of $50m, up $35m from the previous year. Asteron Life saw a 25% increase in new business and in-force premium growth of 6.7%.
Asteron Life’s Executive General Manager, Grant Willis, points to the support and engagement from independent financial advisers as one of the key factors in new business growth.
“We value our relationship with advisers and the partnership they have with us in supporting customers through every part of their life Insurance journey, from new business through to claims.
We were independently rated number 1 this year for adviser relationships and claims management, with our adviser net promotor score (NPS) rising from 44% to 66%. This has contributed to a new business market share increase from 10.5 % -11.3% (March figures).”
More daily news:
Katrina Shanks and Lyn McMorran claim finance sector fatigued in light of another CCCFA review
Legal and regulatory update for the life and health insurance sector
3 July 2023 - The National Anti-Scam Centre will coordinate an investment scam fusion cell to combat the growing problem of investment scams, which are costing Australians more than $1 billion a year. The fusion cell will be led by the ACCC and ASIC and include representatives from the banks, telecommunications industry and digital platforms. It will be the first fusion cell co-ordinated by the new National Anti-Scam Centre and will identify methods for disrupting investment scams to minimise scam losses. https://asic.gov.au/about-asic/news-centre/find-a-media-release/2023-releases/23-180mr-national-anti-scam-centre-s-first-fusion-cell-to-disrupt-investment-scams/
4 Jul 2023 - An Analytical Note by the Reserve Bank of New Zealand has found that Monetary Policy Statements are written in a way that matches the aims of monetary policy. https://www.rbnz.govt.nz/hub/news/2023/07/analytical-note-finds-monetary-policy-statements-text-meets-policy-aims
4 Jul 2023 - The New Life Insurance Code of Practice for the Australian market came into effect on 1 July 2023. https://riskinfonz.co.nz/2023/07/04/australia-adopts-new-life-insurance-code-of-practice/
5 Jul 2023 - NZ Banking Association publish their regulatory radar for June 2023 https://financialadvice.nz/wp-content/uploads/2023/07/June-2023-Banking-Sector-Regulatory-Radar.pdf
5 Jul 2023 - APRA working on independent tripartite cyber assessment study with more than 300 banks, insurers and superannuation trustees https://www.apra.gov.au/news-and-publications/cyber-security-stocktake-exposes-gaps
6 Jul 2023 - Changes to ACC’s Accredited Employers Programme (AEP) aim to deliver a better experience for workers whose injury claims are handled by their employers rather than through ACC directly. https://www.beehive.govt.nz/release/better-experience-workers-changes-acc-programme
6 Jul 2023 - NZ Police Financial Intelligence Unit released “The Suspicious Activity Report” for May 2023 https://www.police.govt.nz/sites/default/files/publications/fiu-monthly-report-may2023.pdf
7 Jul 2023 - The Government has issued a package of regulatory amendments to the Anti-Money Laundering and Counter Financing of Terrorism (AML/CFT) regime. The regulations will come into force in three stages from 31 July 2023 to 1 June 2025.
The first stage of changes, which come into force on 31 July 2023, are to provide immediate regulatory relief for many reporting entities where risk has been identified as being low.
The second stage, which comes into force 1 June 2024, introduces new obligations for entities that already have existing AML/CFT obligations.
The final stage, which comes into force 1 June 2025, introduces new obligations on sectors that were not previously subject to AML/CFT obligations.
https://www.dia.govt.nz/AML-CFT-Regulatory-and-Legislative-Changes-Anti-Money-Laundering-and-Counter-Financing-of-Terrorism
7 Jul 2023 - The Financial Intelligence Unit (FIU) are running free goAML training sessions in Timaru and Christchurch. These in person sessions will run for 2 hours and will cover an overview of the goAML system, along with how to submit suspicious activity and prescribed transaction reports. https://www.dia.govt.nz/AML-CFT-Free-goAML-training
Consultation on Customer and Product Data Bill opens
The Ministry of Business, Innovation and Employment (MBIE) has opened consultation on the Customer and Product Data Bill (sometimes referred to as the Consumer Data Right (CDR)), with consultation running until 24 July 2023.
The Financial Services Council (FSC) is collating member feedback to form an industry view on the on the exposure draft of the bill. FinTech NZ is hosting a roundtable discussion on July 17 to provide MBIE with direct feedback from our sector.
The purpose of the bill is to allow customers to safely access and exchange data held about them. The bill will impact all New Zealand businesses who collect and hold customer data. The bill will require businesses who wish to access data to be accredited and will only permit data exchanges when the customer has given consent.
The intention of the bill is to unlock the value of customer data and benefit consumers through reduced prices, improved product offerings, greater productivity and making it easier to compare products and services.
MinterEllisonRuddWatts has an article that explains some of the obligations the bill will create for organisations.
MBIE intend to roll out legislation on a sector-by-sector basis, with banking the first sector to be designated. CDR has begun to be implemented to an extent on a voluntary basis in the financial sector with Open Banking.
MBIE is running webinars for different audiences that will give people the opportunity to learn more about the draft law.
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