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Partners Life reveals its secret sauce

Partners Life says it is 58% more efficient than other life companies because of its technology and the fact it does not have legacy systems.

Monday, June 7th 2021, 11:57AM 7 Comments

Managing director Naomi Ballantyne says people should think of Partners as a “technology company in the business of insurance.”

She says Partners will “never allow legacy to impact our business.”

Chief financial officer Sean Kam says the "secret sauce" to Partners' success is its efficiency. Based on publicly available data he says Partners is 58% more efficient than its competitors because it uses the best technology, cloud-based solutions and has not legacy systems.

"We have an absolute laser focus on not allowing legacy into our business."

Its technology means the company "can do more with less people".

He believes Partners has an "unbeatable competitive new advantage."

The firm celebrated its 10th birthday with an event for advisers recently.

Ballantyne says in its first decade the company has:

  • Paid $692 million in claims since inception
  • It now insures 215,000 lives
  • 2208 advisers support the company
  • It has trained 1250 advisers
  • Annual premium income sits at $389 million
  • Partners has implemented 232 individual product upgrades
  • Partners is ranked second in the market for in-force business
  • The company has raised $450 million of capital in 10 years
  • Its current appraisal value is $1.3 billion

Ballantyne says Partners has a better lapse rate than its competitors. According to Financial Services Council numbers the average lapse rate across the industry is 11.6%, while Partners sites at 10.2%.

The company is currently getting the largest share of all adviser new business. Ballantyne says 34% of new business is written by Partners and the next biggest is sitting on 20%.

Tags: Naomi Ballantyne Partners Life

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Comments from our readers

On 8 June 2021 at 2:47 pm t marcus said:
Life insurance was an industry ripe for disruption / transformation.

Great stuff by the PL team as they have executed transformation not just talked about it.

Some large bloated life insurers with much larger headcount / overhead than PL will become stranded with their high cost base and fancy buildings.

NZ now has Sir Clive at Resolution as well to take over the bloated incumbents.
On 9 June 2021 at 9:02 am Skeptical said:
No legacy systems - sure, you'd hope they'd continue that post-BNZ acquisition
Cloud based solutions - I guess probably internally
Best technology - Well, it is pretty good.

"Technology company in the business of insurance?" A bit of a stretch considering their application only went online less than two years ago.
On 13 June 2021 at 1:18 pm Interested said:
Partners have done well as a company and lifted the industry benchmark.

However,I would like to think that 58% more efficient than competitors will mean an end to the double digit price rises inflicted on customers. Otherwise it really counts for nothing.
On 14 June 2021 at 3:43 pm F Lloyd said:
Well done to PL for disrupting other product manufacturers.

@interested makes a good point and who is gaining from this efficiency?
Keep it simple and let's say non-commission expenses for the competitors are 25% of the premium pool. If PL have costs 58% lower then they should have premiums up to 15% lower than the market/have better products/make much higher profits or a mix of these.

Anecdotally PL do seem to be leaner and the 58% figure quoted by PL may possibly be about right but that degree of accuracy seems spurious.
On 15 June 2021 at 3:14 pm merv said:
@interested. - well said

Partners may claim to be more efficient (whatever that means as no measure given) but customers still seem to incur price rises.

Where does the benefit of this efficiency go ?

I hope the efficiency is long term and sustainable and is passed onto customers.
On 15 June 2021 at 4:24 pm jeff m said:
Good points Merv (from Manurewa?)

PL have certainly shaken up the market and provided good options for customers and their advisers. However this feels a little like hubris.

Interesting different strategies from the 3 main life insurers. One is focused on health and vitality. CIGNA seem to be a product and UW focus and PL seem to have a tech based approach with service.

Good to see competition.
On 20 June 2021 at 2:12 pm kevin glynn said:
Interesting debate.

It would be shine some light on the efficiency or otherwise of life insurers. The spotlight has been on advisers and the impact commissions have on premiums but there seems to be an opaqueness around the efficiency or otherwise of insurers.

This lack of transparency creates the potential for inefficient markets which high costs being borne by consumers.

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