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Adviser opportunities have never been better

Right now there have never been fewer advisers serving so many consumers with the need for cover, or better cover, and I think the market has plenty of growth left in it.

Tuesday, August 10th 2021, 9:12AM

by Russell Hutchinson

Last year I worked through the statistics that show the number of people that have no cover and are in work.

If people are in work, they probably have some need, enough money, and are sufficiently healthy to buy some cover. There are nearly a million such people in New Zealand - people none of us has not reached before.

The truly good news for advisers is that right now they are almost entirely left to you.

Bancassurance peaked just before the GFC in 2008 and has been declining ever since. Sales were pushed lower by the conduct and culture reviews.

That shook the confidence of banks and their subsidiaries, which were then put up for sale. It won’t last, the buyers all believe they can grow the bank channel again.

But right now, many customers who would have bought cover from banks are without any cover at all and that's very good news for advisers.

The next is a bit more complicated. It is a wind-shift in favour of advisers that the insurers seem addicted to complexity.

There is, in fact, deeply ingrained complexity. To illustrate; recently a friend of mine was made an offer to “quickly” buy cover as a continuation option from a large scheme – the offer was not going to be medically underwritten, but it stated that a “short” application was required.

My friend was amazed to discover that the "short" form had to be completed manually, the form was 16 pages long, and when she asked how long it would take to process the answer was "weeks".

I reiterate – the cover was not going to be underwritten.

Her questions are reasonable too; why don’t they automate this? She is an educated, capable, and literate professional who is undaunted by paperwork – yet she asked me "is it worth the bother?" and "do they want me to buy cover or not?"

The value of complexity to advisers – although it is surely a detriment to everyone else in the market, including insurers – is that faced with it, potential clients turn away and some of them seek advice.

Although for many insurers "making it all simple" is tens of millions of dollars of systems improvements away – but as an adviser, you can probably make that promise today.

 

Tags: Bancassurance Insurance Advisers Opinion Russell Hutchinson

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