Australia’s life insurers need to improve their efficiency and become more agile in delivering the products advisers and their clients need, says Philip Kewin, general manager – retail of Zurich Life and Investments.
“We have to become more efficient in delivering the product to market, so we make the most of all the technology delivered to us [and] deliver the same product more efficiently,” Kewin says, speaking exclusively to Professional Planner.
He believes there is a strong appetite among Australian Financial Services licensees, financial advisers, research houses and other stakeholders for new-style risk products.
“And I think the appetite for simplification is probably there as well, particularly in that area of the market where [insurance is] becoming more expensive. I’m hoping that there’ll be a greater appetite, and a framework that enables advisers to be able to make recommendations for simple products that don’t leave them open to legal scrutiny,” Kewin says.
He suggests it is only reasonable that insurers are also expected to lift their collective game. “It still comes back to the fact that we need to be more efficient. Advisers are being asked to be more efficient, and as an industry, we need to be able to provide more to compete.”
He outlines some areas where greater efficiencies could be found: “It might be pricing, or the way we transact, or being more efficient at the front end, or it might be providing tele-underwriting.”
In defence of brevity
While issues around adviser remuneration have dominated discussion and debate since John Trowbridge handed down his controversial report in March, the product manufacturers themselves have kept a low profile. Kewin defends this stance, which has seen individual insurers communicate primarily through their representative body, the Financial Services Council (FSC).
“The best approach has been to respond through the industry collectively – and not collusively…I think the last thing the industry needs is petty point scoring while that process is going on.”
Speaking for Zurich itself, he says that, “Pre-Trowbridge, we made our position on remuneration quite clear from the outset, both individually with advisers and through our communications.
“And immediately post-Trowbridge, we communicated what our position was. Since then, it’s quite clear that the industry collectively needs to come up with an appropriate response,” Kewin says.
He says it is “unfortunate that the whole focus has been on adviser remuneration, it’s much broader than that, for example [the Trowbridge report’s recommendations] on the code of conduct, accessibility of advice et cetera.
Whatever happens to the life insurance sector in future, from both a product and service standpoint, Kewin believes the role of advisers will remain crucial. “The important thing now is that there’s an appropriate response, where the industry can bee seen as the professional industry that it is.”
