Advisers get satisfaction but may jump ship anyway

Australian financial planners are generally happy with their insurance providers but have no qualms about switching to competitors if they experience poor support or service.

The recently released third annual Investment Trends 2011 Planner Risk Report found that 34 per cent of advisers had stopped using at least one insurer over the past 12 months.

The research, based on a survey of 729 financial planners, concluded in September.

While planner satisfaction with insurance providers remains high overall, the number of planners rating their insurer as “good” or “very good” fell slightly from 81 per cent to 77 per cent.

Significantly, planner ratings of individual features offered by insurers are more mixed, giving rise to opportunities at an industry level.

“For insurance providers seeking to retain their current client base, addressing these gaps is crucial,” said Recep Peker, an analyst at Investment Trends.

“Particularly since switching behaviour is so prolific.”

Aside from the third of financial planners surveyed who had switched insurance provider in the past 12 months, a further 23 per cent said they intend to look for new or additional insurance providers in the next 12 months.

Unsurprisingly the research identified a strong statistical relationship between planner satisfaction and switching behaviour.

Relative to their market share, insurance providers with lower overall satisfaction ratings from their users lose a higher proportion of advisers to other providers.

“Some of the most commonly cited reasons for leaving a provider encompass poor support and service,” said Peker.

“But these things are generally what breaks the camel’s back.”

According to the Investment Trends report, the top three insurance providers by overall planner satisfaction in 2011 were: Macquarie Life, Asteron and AIA Australia.