Southern Cross: No negative impact from commission change

Southern Cross says a change to its adviser commission structures has had no negative effect on the business.

Saturday, February 1st 2020, 10:19PM 1 Comment

The insurer revealed in July that it was restructuring the way advisers were paid.

Chief sales officer Kerry Boielle said the upfront commission paid would increase slightly but trail amounts would fall. Advisers would receive a set amount each year per life insured, rather than a percentage of premium.

Boielle said this week that, six months on, it was “pretty early days” for the new model but advisers had reacted pragmatically and understood why the change was made.

She said it was in their interests, too, that the health insurer was able to manage its costs.

“We’ve continued to see really good support from the advisers we deal with. They are the ones faced with delivering premium increases to clients each year so they know the long-term sustainability piece.”

She said the adviser channel had grown 20% year-on-year, despite the structure change, and had outperformed in 2019.

She said advisers who worked with Southern Cross tended to be those who were focused on customers rather than what they were paid.

“As a not-for-profit, that’s who we appeal to. It’s been a fairly well understood and well accepted change.”

She said Southern Cross was focused on working closely with advisers as they worked through all the changes happening in the industry.

It would take a proactive approach, she said, rather than waiting to see what happened. “We are highly committed to the channel, trying to get close to advisers, more than we have in the past. There is so much change and disruption going on, we want to partner and work with them.”

Tags: Commission health insurance Southern Cross

« Woman 'forgotten' during advice processCigna and OnePath now one »

Special Offers

Comments from our readers

On 6 February 2020 at 6:09 am JPHale said:
What a steaming load of crap.

Not for profit, all good for Kerry to say, she gets her nice cushy salary and advisers get to starve. If this statement was truely correct, Southern Cross staff would also have wholesale pay cuts.

"advisers had reacted pragmatically and understood why the change was made"

No it was inflicted on advisers with no choice. The choice presented was "suck it up or we cancel your agency". There was no discussion and there was no option. While my agency is small, I get the commercial aspect, this change had a 60% impact on revenues for servicing.

“We’ve continued to see really good support from the advisers we deal with. They are the ones faced with delivering premium increases to clients each year so they know the long-term sustainability piece.”

The larger businesses that rely on group business have no choice, they have to sell more to pay the bills, this is a self-fulfilling prophecy, they are locked in with little choice and have to suck up to maintain their business viability.

“We are highly committed to the channel, trying to get close to advisers, more than we have in the past. There is so much change and disruption going on, we want to partner and work with them.”

Frankly not seeing any of this, and this isn't just my experience but advisers who have had long-standing relationships with Southern Cross.

Southern Cross have picked their favourites and have cast the rest adrift.

The systematic restructure of the Southern Cross business is looking more like a sales agency to cater to working people in group schemes. The products become too expensive to maintain once outside the employer group and for retirees it is expensive and the cover options are selecting against the older age group conditions reducing the effectiveness of the cover

I call BS! "empowering all Kiwis to live healthier lives." Southern Cross is failing in its mandate to be a non-profit delivering to ALL New Zealanders.





Sign In to add your comment

www.GoodReturns.co.nz

© Copyright 1997-2024 Tarawera Publishing Ltd. All Rights Reserved