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.
Graeme Lindsay has died
Graeme Lindsay, a life insurance industry stalwart, has died of cancer. Adviser and pioneer insurance product researcher, his presence will be remembered and missed.
Graeme Lindsay, a life insurance industry stalwart, has lost his battle with cancer. Throughout his career Lindsay worked as an adviser, was involved in an industry association, was a member of Million Dollar Round Table, and founded Strategy Financial Services, a business that provides analysis to life and health insurance agents. He was a competitor of ours and yet we will miss his presence in the industry. Whether he was writing about products or insurers he was always keen to highlight the value of good insurance coverage and identify issues that needed to be addressed. He was a pioneer in our sector.
Last December, Lindsay posted on LinkedIn explaining his situation and advocating for everyone to review their insurance cover and make sure they had the right policies and cover in place.
The funeral for Lindsay is scheduled to be held on Monday.
We will miss his voice in our sector.
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nib quarterly premium review results in price increases
nib’s premium review results in price increases for current members and new policies sold this quarter.
As part of a quarterly review, nib have reviewed their health insurance premiums. The changes affect both current members renewing their policies and new policies sold this quarter. The changes for renewing customers are below, with the change in premium for each member varying depending on the benefits, options and excess they have selected, who the policy covers and whether the premium includes a policy fee.
Premiums included in quotations for prospective new members will be updated from 1 July 2024 and the new rates will be automatically updated in nibAPPLY. Quotations dated before 1 July 2024 will be honoured if the application goes into force within 30 days of the quotation date.
More details can be found on nib’s FAQ page or advisers can contact their nib Adviser Partner Manager.
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Legal and regulatory update for the life and health insurance sector
Privacy Commissioner clarifies guidelines on notification periods; The Customer and Product Data Bill introduced to parliament; Privacy study finds higher levels of concern among Māori; Minister of Commerce and Consumer Affairs April 2024 diary released
16 May 2024 - Office of the Privacy Commissioner clarifies guidelines around 72 hours notification period for privacy breaches. https://privacy.org.nz/publications/statements-media-releases/how-long-is-72-hours/
16 May 2024 - The Customer and Product Data Bill was introduced to Parliament. https://bills.parliament.nz/v/6/770a5f4e-2185-4f1f-1395-08dc75512299?Tab=history
20 May 2024 - A recent study by the office of the Privacy Commissioner of New Zealander’s attitudes to privacy shows higher levels of concern among Māori. https://privacy.org.nz/publications/statements-media-releases/maori-are-more-concerned-about-privacy-in-every-way/
21 May 2024 - Minister of Commerce and Consumer Affairs, Hon Andrew Bayly April 2024 diary released with the following potential financial services sector related meeting noted:
4 April 2024 – MEET: Westpac (Pip Greenwood)
4 Apr 2024 – MEET: Suncorp (Jimmy Higgins and Clayton Cosgrove)
8 Apr 2024 – VISIT: Commerce Commission (Commerce Commission Staff)
10 Apr 2024 –MEET: Insurance and Financial Services Ombudsman (Karen Stevens)
10 Apr 2024 – MEET: AIA NZ (Nick Stanhope)
10 Apr 2024 -MEET: Commerce Commision (Commerce Commission Officials)
23 Apr 2024 – MEET: Westpac (Catherine McGrath)
23 Apr 2024 – MEET: Takeovers Panel (Takeovers Panel members)
30 Apr 2024 –MEET: Commerce Commission (Commerce Commission Officials)
Contracts of Insurance Bill
Commerce and Consumer Affairs Minister Andrew Bayly talks about his three focus points; ombudsman welcomes changes; and where to find more information on how the Bill could affect you.
Commerce and Consumer Affairs Minister Andrew Bayly has said that insurance law reforms are “long overdue”, with some laws over 100 years old. Bayly has said his three focus points for the new Contracts of Insurance Bill are to make it easier for consumers to get insurance, for consumers to better understand what they’ve signed up for and for consumers to get paid out more quickly. Bayly has said the government intend to pass the Bill before the end of 2024.
“… Many consumers don’t understand what information they are supposed to tell their insurer, and the consequences if they don’t disclose this information.
Forgetting to tell the insurer something regarded as being material to the risk of providing a consumer with insurance (i.e. whether the insurer would have provided cover or not, and on what terms) can be fatal.
I’m pleased that this law change will require insurers to ask clear and relevant questions, making it easier for consumers to know what information they have to provide.”
Submissions on the Bill are open until 3 June 2024. The Financial Services Council (FSC) is urging members to feedback and has circulated an industry submission process document.
We think that all the questions adviser-focused insurers ask are clear and relevant and that in a full underwriting environment it is clear to customers what they should be disclosing. But this is not the full scope of the changes that the law will bring in. Bell Gully’s comment covers this well:
“Most submitters welcomed the overall approach taken in the exposure draft, which proposed to consolidate, modernise and clarify a number of outdated statutes into one primary statute governing insurance policies generally, as well as the specific relationship between insurers and their customers. The Bill also proposed to bring about significant changes in the law of insurance in New Zealand – particularly relating to the duty of disclosure owed by insureds, the duty of utmost good faith, the remedies available to a party who has a claim against an insolvent insured, and the application of the unfair contract terms regime to insurance policies. The details of some of these substantive changes were met with resistance, including in our submission, primarily due to concerns that the reforms may create significant uncertainty for both insureds and insurers.”
For more details on the content of the Bill, we suggest that you check out their summary here. Steve Wright also outlines seven potential changes facing advisers and insurers here.
Government has repealed parts of the Credit Contracts and Consumer Finance Act
The government has repealed some parts of the Credit Contracts and Consumer Finance Act (CCCFA). Commerce Minister Andrew Bayly said of the affordability regulations introduced to the CCCFA in December 2021
“These regulations created unnecessary compliance costs and are an excessive barrier for lending. And worse, the regulations failed to protect the most vulnerable Kiwis – the very people they were intended to safeguard”
The time to process loans increased substantially, with Minister Bayly saying some lenders had told him small loans that used to take two hours to process took up to eight hours to process under the new regulations.
Additional reforms to the act include:
Improving dispute resolution to better protect consumers.
Exempting councils from the CCCFA so they are able to offer low-risk financial products to help households improve their energy efficiency by installing heat pumps and insulation.
Removing duplicate reporting requirements.
We hope that the relaxation on small loans flows through to banks being able to offer more flexibility to people with what amounts to a timing issue, rather than a lending issue. But we know that lending rules are notoriously difficult to manage. This is one of the reasons why aspects of the wider programme are of more interest.
Minter Ellison puts the changes into context within a program of changes to financial law and regulation which the government has planned.
Of particular interest are the changes in supervisions structures with the responsibility for administering the CCCFA moving from the Commerce Commission to the Financial Markets Authority. Lending is a financial product, and we think the Financial Markets Authority, with conduct supervision responsibilities and, essentially, all the other financial products, is probably a good home for this law from an ongoing regulation perspective.
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Legal and regulatory update for the life and health insurance sector
23 Apr 2024 - The Reserve Bank of New Zealand released its submission on the Commerce Commission’s draft report from its market study into personal banking services. https://www.rbnz.govt.nz/hub/news/2024/04/rbnz-releases-submission-on-draft-commerce-commission-market-study
23 Apr 2024 - The Financial Markets Authority has published its guide for Managed Investment Scheme managers and their supervisors for effective liquidity risk management, following consultation. https://www.fma.govt.nz/news/all-releases/media-releases/importance-of-effective-liquidity-risk-management/
23 Apr 2024 - Commerce Minister Andrew Bayly is planning to align the rules of the four approved financial dispute resolution schemes - Banking Ombudsman, the Insurance and Financial Services Ombudsman, Financial Services Complaints Limited, and the Financial Dispute Resolution Service – and raise the maximum amount the schemes can award to $500,000. The government aims to have the regulations providing for the changes in place by July 18. https://www.goodreturns.co.nz/article/976523065/aligning-disputes-resolution-schemes.html
23 Apr 2024 - The Australian Prudential Regulation Authority (APRA) has released a consultation on proposed enhancements to the content and presentation of its suite of quarterly insurance statistical publications. https://www.apra.gov.au/news-and-publications/apra-consults-on-enhancements-to-quarterly-insurance-publication-suite
Wotton + Kearney release 2023 NZ Insurance Market Trends Update
Wotton + Kearney have released their 2023 NZ Insurance Market Trends Update. Of note, it includes updates on:
· increase in director accountability for ESG issues and climate-related financial disclosures;
· how organisations will need to consider how applicable tikanga values should inform their conduct when dealing with employment relationship issues;
· how organisations need rigorous processes in place for restructures and redundancies;
· extensions to Schedule 2 Occupational Diseases;
· changes to the regulation of medicines, medical devices and natural health products;
· the passing of the Therapeutic Products Bill 2023;
· cyber, privacy and data security.
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mySolutions webinar 'Are you maximising your marketing potential' 9am 27 September
27% of 4,120 claims received by IFSO were related to health, life and disability insurance
Lifetime webinar 'Your Homeownership Adventure Begins Here' 7pm 27 September
Man trying to claim pregnancy care on his health insurance policy has complaint turned down by IFSO
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Changes to IFSO terms mean more consumers will be able to access free dispute resolution
Effective 1 September 2023, changes to the Insurance & Financial Services Ombudsman Scheme (IFSO Scheme) and its terms of reference (TOR) and constitution will mean more consumers will be able to access IFSO services.
Once the changes take place, IFSO will be able to investigate insurance claims complaints and financial services’ products complaints up to $350,000+GST, or $2,625+GST per week for regular payments. This is an increase from current limits of $200,000+GST and $1,500+GST respectively.
Insurance & Financial Services Ombudsman Karen Stevens said
“Previously, anyone with a claim over the limit of $200,000 would have had to pay for legal representation to take their case to court.
Court proceedings are not cheap and they’re certainly not free – like the IFSO Scheme process. The changes bring us into line with some other dispute resolution schemes in the financial sector, and will mean a number of extra cases are now eligible for us to look at.”
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Kate Dron believes there will still be more mergers and acquisitions in NZ insurance space
Financial Advice NZ webinar 'Navigating the world of digital currencies with confidence' 16 August
Linley Wood appointed as an Independent Director on the Chubb Life NZ Board
Official unemployment rose to 3.6% in the June quarter
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Government has made some progress on reducing health waitlist times
Fidelity Life announce speaker line up for Engage 2023 conference
Fidelity Life have announced the speaker line up for the Engage 2023 Conference.
Jessica Brady - one of Australia’s 50 Most Influential Advisers, she’ll inspire you to seize the possibilities of new platforms and new models capable of reaching larger and more diverse customer audiences.
Kaila Colbin - the 2022 Kea World Class New Zealand Friend of New Zealand award winner, Kaila’s the leadership guru who partnered with 14-time rugby champions the Crusaders on a renowned high-performance leadership programme.
David Beaton - whether its financial advice or boutique gin distilling, David Beaton is a business-building ninja obsessed with using technology and process redesign to optimise profit and take business performance to the next level.
Angus Woods - Adviser Ratings has evolved into one of the largest owners of financial services data assets in Australia. Angus Woods’ story is a glimpse of the new breed of industry powerbrokers using data solutions to take advisers – and insurers – to the next level.
Other guests include former senior minister Steven Joyce, who will provide on point political insights ahead of the upcoming election, and MC for the event, entertainer Jackie Clarke.
Adding to the line up to preview some exciting upcoming initiatives for advisers are Fidelity Life Acting CEO Ian Clancy, Chief Sales and Service Officer Bronwyn Kirwan, Chief Information Officer Billy Miller and Chief Customer Officer Peter Doherty.
Engage is Fidelity Life’s flagship annual conference for advisers and will be held in Christchurch on 12-13 September, followed by Auckland on 20-21 September.
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Government announces pay equity offer for Te Whatu Ora nurses
More people expected to delay retirement due to costs of living
The New Zealand Seniors Series: Working Seniors Report has found that a substantial number of New Zealanders may need to delay retirement due to their financial situation.
While the most commonly cited reason to keep working beyond 65 years of age was enjoying working (65%), 61% selected the rising cost of living and 57% chose financial needs as reasons for working past retirement age.
Only 43% of people surveyed felt on track to retire at the age they preferred, with 37% believing they may have to keep working past their preferred retirement age to fund their retirement (up from 23% in 2021) and 20% believing they would not having full control over the age they retire.
74% of people agreed that their home ownership and mortgage status had a great impact on their retirement decisions and 78% thought that being fully retired with mortgage debt was a key concern.
The implications of the pandemic, rising cost of living and looming global recession have meant that 21% of respondents will need to delay their full retirement age slightly and 17% will need to delay their full retirement age considerably.
In December we examined how the market for insurance has changed due to patterns of longer living and longer working. Between 2002 and 2022 the share of 65 to 69 year-olds who are in work rose from just over 20% to 46.5% - a group of nearly 120,000 people. It seems plain that if life is extending, so will working life, and probably the need for cover will continue longer than previously thought.
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Enquiries to the Insurance & Financial Services Ombudsman Scheme break records three months in a row
MBIE planning a new consumer rights and harm prevention campaign
Registrations for Financial Advice NZ’s August Out of the Box tour are now open
Submissions for the ANZIIF New Zealand Insurance Industry Awards are now open
Investment Leaders Forum will be held 30 July - 1 August in Queenstown
Study finds moving for an hour a day can lower the risk of developing diabetes by 74 per cent