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Adviser alleges agency axed over advocacy

A financial adviser believes OnePath has terminated his business agreement because of his client advocacy during the furore over the ANZ/ING Diversified Yield and Regular Income Funds.

Wednesday, January 19th 2011, 6:59AM 9 Comments

by Jenha White

Vision Financial Management director Mike Beuvink says he intended to start business with OnePath again last month after he inactivated the agreement in February 2009 during the DYF/RIF debacle.

Initially OnePath regional sales manager Scott Rasmussen agreed and sought to organise a meeting with dates being discussed.

However, a meeting never occurred as Rasmussen emailed Beuvink saying "after investigating the circumstances of Vision Financial Management being inactivated, OnePath is not in a position to re-activate your agency in the future."

Asking for clarification, Beuvink is told in an email also copied to Jeremy Nicoll, Charlie Howe and Sam Aston, that the reason he will not have his agency reactivated is because his persistency sits at 74.61% which falls below the minimum of 85%.

Beuvink says with senior management copied into the notice of termination, an executive meeting must have been held about the issue.

He informs OnePath that by not giving him the opportunity to redress his persistency rate, it has breached its agreement in section 1, accreditation. He believes it would only have taken him two cases to return to the 85% persistency level.

He tells Rasmussen that he is prepared to build a bridge and get over the ING DYF and RIF debacle, asking why OnePath won't do the same.

Two days later Beuvink says OnePath wrote to his clients without his knowledge advising them of the termination and endeavouring to cross market. An action he believes breaches section 7 of the agreement, client ownership.

Beuvink says he can't see the gain for OnePath in their actions, as clients are approaching him after receiving the letter asking him to replace their business.

"It begs the question, will OnePath decide to cut any adviser out of the loop who doesn't toe the ANZ line going forward and cancel their agency agreement?"

A OnePath spokesperson replied to these allegations saying it does not discuss or comment on any business arrangements with individual advisers or clients through the media.

"We find it deeply concerning that an adviser has discussed his own breach of our agency agreement in this manner.

"All of our agency contracts are measured against a number of important criteria and again we do not think it's appropriate to discuss these commercial arrangements in public."

 

 

Jenha is a TPL staff reporter. jenha@tarawera.co.nz

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Comments from our readers

On 19 January 2011 at 9:38 am Mac said:
Should One Path wish to continue to prosper within the independent intermediary market for the distribution of their products, it may be appropriate for One Path to remember that the primary relationship is between the client and the intermediary. Ignore this at your peril.
On 20 January 2011 at 4:48 pm 6ftndr said:
yep, seems like the big ugly troll is trying to be the big schoolyard bully, whilst we may not know the full story.....it does seem quite plausible now that anz owns it and this doesn't bode well for the rest of us, although since anz took ownership i haven't given any business to them anyways
On 21 January 2011 at 10:21 am John said:
Reading through the fine print of agency agreements insurance companies all state that they can market to an adviser’s clients if they decide to terminate their agreement with you. Beuvink's persistency rate doesn't look flash but as we all know there are always two sides to a story. With ANZ driving the corporate whip now and knowing how shareholder profit ranks on their list of priorities I would say that service levels at OnePath will only decline going forward. Sad as Club Life and ING Life were market leaders at one stage but then this is what happens when banks are allowed to buy insurance companies. Little wonder then that Naomi Ballantyne has decided that the time is ripe for a new player to enter the market.
On 21 January 2011 at 3:26 pm Mike said:
75% is not that bad and could easily be fixed. I'd imagine there are many advisers who write OnePath (OP) product who have persistency below 85%, but I don't see OP canceling their agreements. If this is the way OP are treating advisers, it will be no surprise if many jump on to the "Partnership Group" ship when it sets sail shortly.
On 21 January 2011 at 4:15 pm Andy Phillipson said:
I am worried myself that with the total ANZ/National control that many other agencies may also be in for the axe because OnePath targets are not met! How can a broker pertain to be independent when a dollar target must be produced with one provider (specifically mortgages, however I can see risk and investments heading the same way). Shame on ANZ.
On 21 January 2011 at 7:24 pm John said:
Andy the simple answer is they can't. Any broker who says that he or she is independent but then has to give x amount of their risk or mortgage business to one provider is clearly deluding themselves if they think they are independent. This is why advisers that go down the QFE path need to think long and hard about the implications that such a move will bring to their businesses. I’ve said it before, one of the key advantages advisers can have over the banks or insurance companies is in giving people “choice” when it comes to insurance or mortgage products.

On the insurance side I wonder how many advisers out there let their clients know that there are providers now paying income protection or mortgage repayment benefits in advance as opposed to some of the older insurance companies that still make clients wait for the money and pay in arrears? I’m a relative newcomer to insurance but even I can see the importance of this feature when selecting an insurer for my client. I currently have agreements in place with 4 of the major insurers and will be looking to add another 3 to my panel this year (Naomi’s new company included)

Despite some of the comments from readers on here there (usually these are people who only have one insurer or lender to offer their clients anyway) there IS such a thing as an independent adviser and those that deserve this title are very good at giving clients a range of providers to suit their individual circumstances. The day that I just sell the one product to a client is the day I go back to being called an employee.

I've no doubt that ANZ over time will stuff up a good thing with OnePath and like Mike says above many advisers I'm sure will simply vote with their feet and board the "Partners Group" ferry instead.
On 21 January 2011 at 8:25 pm beaudesert said:
Having read the article and knowing a fair bit about agency agreements, let me be clear. The Insurer, Onepath Life would have not just terminated this brokers agency without due consideration. There is definately more to this story than maybe the adviser is saying. Insurers do not just cancel an agency, in fact, in this instance, the broker told ING to get lost. Now he is crowing because they do not wish to work with him, maybe they are right. It's high time you brokers saw the real picture, persistency alone would not generally be a reason for termination, and they do not market the clients as the article suggested. Naturally they have policyholders who need to be informed and provided an opportunity to discuss any issues about their cover. Its as simple as that. As regards the other comments from advisers, about Onepath, they are owned by a bank, so what, just like almost every other company.Their products are good,in fact leading edge i would say, although service levles need to be improved.

At the end of the day, depsite all these so called issues, lots of brokers use them and have good relationships with them.
On 24 January 2011 at 11:53 am Mike said:
Beau,

Didn't you read the article or are you OnePath/ANZ in disguise?

OnePath/ANZ cancelled Beuvink’s contract on the spurious basis of the adviser’s persistency being at 75% instead of at 85% without giving him the opportunity to rectify the situation. But as the article says, the real reason is that the adviser acted in his client’s best interests (supporting them in obtaining a fair repayment of money invested), an action which was not in OnePath/ANZ best interests. The question is here, Beau, who do we represent - the client or the insurance company? As a broker, I know who I represent and obviously Beuvink knew who he represented as well. One has to wonder from your feedback, who you represent?

The article doesn't question OnePath/ANZ products, it questions the way OnePath/ANZ will act against advisers who don't toe the OnePath/ANZ line, who act in their client's best interests.
On 24 January 2011 at 1:15 pm Alistar said:
Well said Mike. I think like you that Beau's comments tend to suggest that he is speaking as an employee of OnePath/ANZ. Given the service levels at OnePath (which I think we can all agree are not flash) they will need to get their act together in a bloody big hurry or Naomi's new company will be taking the bulk of their business off them within a few short months time.
Commenting is closed

 

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