|        About Good Returns  |  Advertise  |  Contact Us  |  Terms & Conditions  |  RSS Feeds

NZ's Financial Adviser News Centre

GR Logo
Last Article Uploaded: Friday, July 10th, 9:53AM


Latest Headlines

Sovereign boost commissions; nib offers a new model

nib moves to spread commission offer as Sovereign boosts its advisers' pay cheques.

Tuesday, November 7th 2017, 12:00PM

by Susan Edmunds

Health insurer nib has launched a spread commission option for advisers, which its chief executive says should help them grow stronger businesses.

The model offers 35% upfront and 25% servicing.

nib chief executive Rob Hennin said it was designed to encourage advisers to take a longer-term view of their business.

“What we are trying to do is encourage advisers to talk to their BDMs and have that cash flow discussion, the increasing capital value discussion, growth discussion. To talk about how they lower the risk and volatilty in their business and grow a business that has long-term value and security.”

He said health insurance was a long-term proposition. Spread commission would encourage persistency, he said. “In the long-term the adviser is better off. The money works itself out. The most important thing, we think, is as the income stream changes it helps advisers adjust their attitude to risk and investment and to take a long-term view, they behave differently.”

Advisers who did not have to worry about so much income volatility could focus on investing in their businesses, he said, building marketing and customer service and creating higher quality businesses.

nib has an agreement with Fidelity Life to allow its advisers to distribute Fidelity’s life insurance products. That insurer has also had a focus on spread commission arrangements.

Hennin said he was not sure what proportion of advisers would take up the spread commission option but expected it would become the norm in future.

“If you’re in this game for the long term you want to align your revenue stream with your customer servicing model – you end up with the spread model. At the end of the day we just want to make sure we’re offering the customer choice and the adviser choice.”

Meanwhile, Sovereign has also changed its commission structure.

It has revealed that as of November 1, advisers would receive a minimum underpin of 80% production bonus and 14.25% quality bonus.

On a rate-for-age policies, the minimum commission will be 200% upfront. Level policies will pay 161% minimum.

Sources said it could be an attempt to claim back some of the independent adviser market share that has gone to other insurance firms over recent years.

A spokeswoman said Sovereign would not comment on its commercial terms.

Tags: Commission Fidelity Life financial advisers health insurance investment nib risk Rob Hennin Sovereign

« Fidelity Life looks to accelerate growth with new capitalANZ keeping OnePath »

Special Offers

Comments from our readers

No comments yet

Sign In to add your comment



Printable version  


Email to a friend
Insurance Briefs

Less stressed during lockdown
New Zealander’s health and wellbeing had surprising benefits from the Covid-19 lockdown.

Southern Cross supports new safe haven for at-risk pets
Southern Cross Pet Insurance has teamed up with Pet Refuge to provide temporary shelter for animals affected by family violence.

nib Foundation supports Lifeline to the tune of $150,000
To support the growing mental health needs of Kiwis emerging from the Covid-19 pandemic, Lifeline Aotearoa has increased its service capacity thanks to a $150,000 grant from nib foundation, the charitable arm of nib New Zealand (nib).

Southern Cross halves staff numbers
Southern Cross Travel Insurance is slashing its staff numbers from 90 to 45 people.

News Bites
Latest Comments
  • Harking back to the old days
    “Really positive news. NZ has been blessed by many successful leaders and it is good that their skills can skill be utilised...”
    3 hours ago by Francis L
  • Harking back to the old days
    “I dare say Cigna just got that extra grunt it's been looking for....”
    4 hours ago by Matron
  • Greens want ACC extended to cover sickness
    “The Greens have no idea The purpose of the Woodhouse report was to remove the "at fault" component of accidents Sickness...”
    20 hours ago by LNF
  • Commission disclosure: What's material?
    “The consumer should know that there is at times large amounts of comission involved but it has to be balanced with not confusing...”
    1 day ago by Good Hamish
  • Commission disclosure: What's material?
    “There should be no place for a subjective materiality test in the disclosure regulations, especially where is is the party...”
    1 day ago by Paul Flood
Subscribe Now

Cover Notes - Specific news aimed at risk advisers

Previous News


Most Commented On
About Us  |  Advertise  |  Contact Us  |  Terms & Conditions  |  Privacy Policy  |  RSS Feeds  |  Letters  |  Archive  |  Toolbox
Site by Web Developer and