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[WATCH] Now is not the time to sell an advice business

Insurers are worried about the drop in new business levels and a growing trend for advisers to leave the market.

Friday, June 3rd 2022, 6:04AM 4 Comments

Partners Life chief executive Naomi Ballantyne says the latest industry figures show that new business levels have continued to fall.

This is across the industry and AIA have also confirmed, when it launched its Starter Plans that new business volumes were down.

Ballantyne says part of fall in new business is due to banks selling their life insurance operations.

But also many of the traditional lead sources, such as mortgage advisers has dried up.

Ballantyne is worried that advisers are now rushing to sell their businesses.

While part of the reasons is declining sales volumes regulation is also having a negative impact.

“It could be the start of a race to the door and that worries me as I don’t think it’s the right thing for those advisers,” she told GRTV.

She says it is the wrong thing for those advisers to do as businesses will be sold at fire-sale prices.

“The value of what you’ve built up will never be lower.”

Ballantyne is encouraging advisers to get licensed. If they do not hold a licence when the new regime kicks in next year their trail commissions will stop.

“Getting a licence adds value to your business.”

“I’m worried people are making short term decisions.”

Watch the full interview on GRTV here.

Tags: GRTV

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Comments from our readers

On 31 May 2022 at 8:27 pm Murray Weatherston said:
There seems to me that there could be a fair amount of self-interest underlying both this interview and the earlier one.
Partners disrupted the industry and then implemented some steep premium increseases. Maybe the hunter became the hunted.
Then the economy started to tank as the Covid stimulus was not maintained at the same level. Then interest rates started to rise. And inflation started to squeeze budgets.
Maybe the lesson is Galatians 6:7.
On 1 June 2022 at 9:49 am John Milner said:
Advisers leaving the industry because of a licence requirement are selling themselves short. With appropriate help, many would fly through with little effort and add value to their business. Although time is now short, try investing in you and your business. Instead of handing that value over to someone else.
On 1 June 2022 at 11:57 am JPHale said:
Also maybe an effect that the covers clients want are not the covers clients are able to attain.

The change of approach to disability cover in the last two years, especially for self-employed, means that other providers are better candidates on policy terms.

Though the tempering of that is the other insurers aren't so helpful when it comes to agreed value or accepted levels of coverage.

When we have a full advice practice that isn't just about life and trauma, the reality of underwriting attitudes (across all providers) has a significant impact.
On 7 June 2022 at 6:49 pm hove albion said:
There seems to be little in the way of facts provided by PL to justify the generalizations.

New business may fluctuate but the numbers I have seen the risk market is still growing in terms of actual premiums in force.

The industry still offers a great service to customers and there is much demand for quality advice.

Agree with JPH that complex covers are difficult to get thru UW but straight through processing for simpler and smaller covers has made things smoother. So it is ups and downs.

PL easily knocked and after the debacle of the secret sauce hubris this was deserved but they have added much to the industry. I suppose they are now nothing special but still needed to provide competition.

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