Wealthpoint chief executive Simon Manning said that Wealthpoint General Insurance has been formed primarily to support member businesses expand their general insurance offering to clients.
While members have historically had access to a small number of providers, led by a successful and long-term relationship with AMP General and Vero Insurance, Wealthpoint was keen to expand the
range of suppliers members could deal with, particularly for commercial, property and liability business lines.
Manning said while several new supplier arrangements were introduced for Wealthpoint members in the past year, including with specialist insurers such as Delta and Star Insurance, Wealthpoint was conscious that access to some of the larger insurers, including those operating under IAG brands, was only possible if structured through a standalone brokerage.
In addition, while some Wealthpoint member businesses had explored the option of setting up their own brokerages, there were significant barriers to their ability to do so, including high setup costs, lack of scale at member level, and potential regulatory risks.
Taking both of these factors into account, Manning says that the Wealthpoint management team and board recognised the advantages of leveraging the scale of the entire network by setting up a centralised brokerage that all members could access. In effect this has allowed each member business to operate brokerages themselves.
Manning believes that the way the Wealthpoint General Insurance brokerage is structured is unique among large adviser groups, recognising that some groups also offer general insurance solutions for their members: “There are two ways our members can transact through the brokerage and both allow our members to remain in control and grow the capital value of their business. Members using the brokerage retain ownership of the client relationship and can build strong additional revenue streams. Alternatively, members can continue to use the more administratively simple ‘agency’ arrangement, which requires less resourcing by the adviser business.”
Wealthpoint General Insurance offers two models for members. The first is a specialist model for experienced general insurance advisers who are qualified to provide advice to clients under their own business brand. Back-office processing, invoicing and premium funding is partly managed by Wealthpoint General Insurance.
Members can also opt for a referral model if they don’t have general insurance capability within their business. For these, a Wealthpoint General Insurance broker provides the advice and takes on all operational responsibilities with the referrer paid an annual referral fee for the life of the policy.
Manning said this model has the added benefit of adding to the capital value of their businesses and is the first step towards developing general insurance capability for those members wanting to broaden their scope of advice in the longer term.
Wealthpoint General Insurance is currently staffed by a broker manager and two broker support staff. Wealthpoint expects to scale up as member demand continues to build. According to Manning, since Wealthpoint General Insurance started placing new cover in early March, they are already seeing significant operational efficiencies being delivered to members with far greater product choice available to clients.
”We are excited to introduce Wealthpoint General Insurance as the latest initiative in Wealthpoint’s three-pronged strategy to develop our member offering, expand supplier choice and lower our members’ costs. 2021 is shaping up to be a big year for Wealthpoint members. Wealthpoint General Insurance is the first cab off the rank in our enhanced member offering and I look forward to revealing a several significant additional launches over the next few months.”
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