Legal and regulatory update for the life and health insurance sector

29 Apr 2025 - The FMA release Jess Learns to Invest Episode 4 | Market Volatility and Your Investments with Brad Olsen. https://www.fma.govt.nz/library/podcast/jess-learns-to-invest-episode-4/

29 Apr 2025 - The FMA has announced the six fintech firms who will be testing their innovative products, services or business models in the FMA’s pilot regulatory sandbox.

The successful fintech firms are:

• ECDD Holdings Limited   - part of the exchange service Easy Crypto) intends to launch a yield bearing NZD-backed stablecoin and to generate revenue from interest earned on money held on trust in interest-bearing accounts.

• Emerge Group Limited   - intending on offering a digital-first business banking alternative for small and medium-sized enterprises (SMEs).

• Homeshare  - which appears to be an investment company aiming to assist period with home sharing schemes.

• IndigiShare  - with aims to offer a koha-loan platform designed to break down barriers to entry for indigenous businesses and provide funding for Māori entrepreneurs, startups, and SMEs, especially those with a strong social impact

• Invest in Farming Co-op - with intention to offer individuals a way to invest in agricultural businesses directly from their smartphones.

• Tandym Limited - currently offers full-service solutions for recruitment and workforce development and management, connecting businesses with top talent, we are unsure what their interest in financial services.

https://www.fma.govt.nz/news/all-releases/media-releases/fintech-sandbox-participants/

29 Apr 2025 - The FMA has published the first edition of FMA Financial Advisers Update. https://createsend.com/t/r-B06F256588858C182540EF23F30FEDED

29 Apr 2025 - The FMA have published a Consumer Confidence Factsheet. The results of the Consumer Confidence Survey indicate that that Māori and women are less likely like to feel confident in NZ's financial markets, and less likely to feel confident our financial markets are effectively regulated. The results indicate that Māori and women are less likely like to have health or life Insurance, but Māori are more likely to have funeral Insurance. https://www.fma.govt.nz/library/research/consumer-confidence-factsheet-2025/

29 Apr 2025 - The FMA release ‘5 mins with the FMA’ podcast #13: Consumer Confidence Survey. https://www.fma.govt.nz/library/podcast/5-mins-with-the-fma-podcast-13/

30 Apr 2025 - The Office of the Privacy Commissioner is asking for feedback on Privacy Amendment Bill (IPP3A) draft guidance. Feedback can be submitted between 30 April - 25 June 2025. https://www.privacy.org.nz/news/haveyoursay/

1 May 2025 - The RBNZ has released research which investigates why the ‘natural interest rate’ has fallen in New Zealand over recent decades. https://www.rbnz.govt.nz/hub/news/2025/05/research-investigates-why-the-natural-interest-rate-has-fallen-in-new-zealand-over-recent-decades

Partners Life announce new Chief People Officer

Partners Life has announced that Helen Meade has been appointed as their new Chief People Officer, effective April 2025. Most recently Meade was Chief People Officer at Les Mills International and she has over 20 years’ experience in human resources, transformation and communications, having worked in the insurance, wellness/health, technology and FMCG sectors.

Partners Life CEO Michael Weston said

“I'm delighted about Helen joining our executive team. She's a dynamic leader with a proven track record of attracting, developing and retaining great people and teams – who are our most important asset and competitive advantage.”

More news:

Banking Ombudsman Service cases up 3% more than the previous quarter

ICNZ finds 20% had switched insurance providers in the last two years

Bigger not necessarily best when it comes to KiwiSaver

Consumer NZ has taken a look at how KiwiSaver is going. Big banks, with their brand recognition and big budgets, have long been an almost default choice for people deciding who to invest their KiwiSaver funds with. That looks like it’s starting to change. Encouragingly, 29% of new members chose their KiwiSaver scheme independently, and 8% consulted a financial adviser about what their best option would be, though 14% were automatically allocated a default scheme. There is still some reluctance to change providers, with 12% of people feeling it’s too much hassle to change provider, 8% having thought about switching but haven’t gotten around to it and 5% not knowing where to start.

With more than 3.3 million members and more than $111 billion of total funds under management, it’s worth putting in a little effort to see which fund best suits your situation.

While banks in general are big spenders on advertising, ANZ outspends them all. Yet ANZ’s KiwiSaver returns are underwhelming, coming in last (12th) for its management of conservative KiwiSaver funds, 6th (out of 12) for moderate funds, second to last (out of 15) for balanced funds and 10th (out of 12) for growth funds, according to Morningstar’s December 2024 results. Yet ANZ holds the largest share of the KiwiSaver market, with $21.9 billion funds under management.

As of 2021, ANZ and ASB are no longer default KiwiSaver providers, leaving BT Funds (Westpac) and BNZ as the only default big bank providers for new members. It will be interesting to see how this impacts the various banks’ KiwiSaver market share over the next decade or two.

In good news, Consumers NZ’s annual survey on KiwiSaver satisfaction highlights growing satisfaction, with February 2025 results showing 82% were satisfied with their provider.

And what do people most want from their KiwiSaver provider? Good returns with responsible investments came out top (42%), followed by the best returns (37%) and investing responsibly, even if it comes with slightly lower returns (14%)

More news:

Southern Cross Health Society using Patient Feedback to celebrate surgeons

Shaun Phelan is retiring from his role as National Manager of MAS Business Advisory Services

AML Summit 2025 is on 8 - 9 May in Auckland and livestreamed

This week is World Immunisation Week

Report finds increasingly, pregnant people are presenting for care with no, or minimal, antenatal care

Concerns and scepticism about AI

While Artificial Intelligence (AI) is rapidly being rolled out globally, concerns remain around privacy, cybersecurity and accuracy and reliability of outputs.

A survey by the Financial Planning Standards Board of more than 6,000 individual practitioners in finance found that 54% of respondents were either already using or piloting AI in their business (with a further 10% planning to rollout AI in the next 12 months). Respondents believe likely uses of AI will include collecting client information, analysing data and developing recommendations. Yet almost half worried about data privacy and cybersecurity and 42% worried about accuracy and reliability of outputs.

GlobalData’s 2024 Emerging Trends Insurance Consumer Survey, which polled more than 5,500 people across 11 countries, found consumers believed AI could have some benefits. Perceived benefits using AI included shortened time required to reach a customer service representative (73.8%), gains in operational performance (71.5%) and better pattern recognition than humans (71.2%). Those who have engaged with AI insurance chatbots were impressed, with 74.5% reporting being satisfied or very satisfied with the interaction. Despite these beliefs, consumers were found to have data privacy concerns and trust issues.

GlobalData’s 2024 Emerging Trends Insurance Consumer Survey (Q3), found that 39% of respondents would be quite or very comfortable having an AI tool decide the outcome of their insurance claim.

More news:

Fidelity Life held first adviser council meeting of the year

Tony Vidler writes about the importance of a prospecting system

NZUAC Christchurch Expo is on 7 May

Apex Advice are looking for a Head of Marketing and Communications

mySolutions webinar 'The journey of building a multi discipline practice' is on 30 April

Code of Banking Practice updated with new commitments to better protect customers against scams

Privacy Week 2025 is coming up

Privacy Week 2025 runs from 12 – 16 May, with this year’s theme being Privacy on Purpose. You can register for a range of free webinars which span the gamut from AI and Privacy to Māori data privacy.

The timetable of webinars is below.

More news:

Partners Life webinar 'FMA monitoring visit, getting ready to be ready' 8 May

Fidelity Life update Working together guide

FSC members can attend a FMA Special Interest Group Networking Event 7 May

Financial Advice NZ webinar 'Making a Difference: Stories of Impact and Innovation' 30 April

Fintech Festival is on 30 April 2025

Digital Trust Hui Taumata is on 12 August

New Zealand’s annual inflation rose slightly to 2.5% in the March quarter

Premium comparison v126 - a massive update!

On Friday we uploaded the V126 Premium Comparison database to all subscribers. This was a massive update with just under 217,000 price points updated and 145,000 new price points added! A summary of the changes is below:

Changes in V126

- Updated Fidelity Life all rate-for-age rates effective 1/4/25

- Added new nib Adviser Ultimate Life and Living range effective 2/4/25

- Updated AIA Policy Fee to $7.80 Effective 1/1/25

- Updated Pinnacle Life and Trauma rates effective 19/11/24 and added Pinnacle Life TPD rates

When you get the database we recommend you open it and check out the recent changes notes and reports.

AIA introduce new $10,000 excess option

AIA has introduced a new $10,000 excess option for Private Health, making it live on 17 April. It will be live on Quotemonster at the end of next week, joining the range of $10,000 excess options already available. It’s a valuable tool to help manage costs for a client group that can typically manage a bill of $10,000 provided the insurer can stump up with the balance. With medical inflation running hot, this is a helpful additional option to offer clients struggling to afford retaining their cover as they age. Link: Policy Wordings and Enhancements Information

Legal and regulatory update for the life and health insurance sector

17 Apr 2025 - RBNZ’s Assistant Governor/General Manager Strategy, Engagement and Sustainability Simone Robbers will be leaving at the end of May 2025 after six years in the role. https://www.rbnz.govt.nz/hub/news/2025/04/ag-gm-strategy-engagement-and-sustainability-leaving-rbnz

23 Apr 2025 - CoFR has released a joint Issues Paper on Access to Basic Transaction Accounts. CoFR is seeking feedback on the proposed introduction of basic transaction accounts to better support customer groups that are currently excluded. The consultation will remain open for eight weeks and will close on 18 June 2025. https://www.cofr.govt.nz/news-and-publications/cofr-seeking-feedback-on-access-to-basic-transaction-accounts.html

23 Apr 2025 - NZ Police Financial Intelligence Unit release “The CASH Report” for March 2025. https://www.police.govt.nz/sites/default/files/publications/fiu-monthly-report-mar2025.pdf

23 Apr 2025 - Banks are updating their Code of Banking Practice with five new commitments to better protect customers from scams. The five commitments introduced to the New Zealand Banking Associate Code of Banking Practice include:

• a Confirmation of Payee service for customers to check that the name of the person they are paying matches the account number, which has already commenced roll-out

• pre-transaction warnings to consumers based on the payment purpose

• identification of and response to high-risk transactions or unusual account transaction activity, and the ability to block or delay transactions in some cases

• providing a 24/7 reporting channel for customers who think they’ve been scammed, and responding to protect accounts

• sharing scammer account information with other banks to help prevent criminal activity, and freezing funds where appropriate

The updated Code comes into force on 30 November 2025. 

https://www.beehive.govt.nz/release/better-compensation-scam-victims

23 Apr 2025 - The FMA release ‘5 mins with the FMA’ podcast #12: Access to Financial Advice Review. https://www.fma.govt.nz/library/podcast/5-mins-with-the-fma-podcast-12-access-to-financial-advice-review/

Proposed changes to Health and Safety Laws

You may have seen the proposed changes to Health and Safety laws, whereby the government wants to reduce compliance costs and provide greater certainty for businesses. Bell Gully have a good summation of the proposed reforms here, but basically the Government is endeavouring to reduce the compliance burden, clarify health and safety duties (including limiting obligations for small, low-risk businesses) and clarify the distinction between governance and operational health and safety responsibilities.

There are many opposing points of view on the changes. Council of Trade Unions president Richard Wagstaff has said

"It's disappointing to see the minister has ignored the widespread consensus on what New Zealand needs to do to improve its poor track record and instead has chosen to carve out small businesses from good health and safety practices.

Exempting small businesses from best practice health and safety makes no sense when we know that small business are riskier and need more support."

Institute of Directors general manager Guy Beatson said

"Clarifying that boards are accountable for risk management and safety culture - not hands-on management - will mean directors can better focus on their core governance role without inadvertently overstepping."

Mike Cosman, chair of the Institute of Safety Management said

"The reforms are focused instead on costs to businesses of prevention and not the much greater costs of harm.

This seems to be looking through the wrong end of the telescope to us because the cost of our poor health and safety record is north of $4.9 billion per year to say nothing of the impact on workers and their families."

Russell Hutchinson has taken a look at the proposed regulations and put in his two cents.

As a country we have a not-terrible, but not-so-good track record on health and safety. One measure is fatal accidents, here I have selected countries we often use in comparisons:

Clearly, we are not as bad as, say, the United States. If we delved into that we would see significant variation on a state-by-state basis – but let’s not worry about that for now. Compared to Australia, for roughly every three people who die in a workplace accident there, four will die here. Not so good. What’s surprising is how well the UK performs – better than France and much of the EU, and better than Japan, places I normally consider to be better organised and more prescriptive in terms of employee protections. Not so! I like it when we find good data which challenges my pre-existing view. It’s a reward for paying attention to the data.

Are the proposed changes to governance liability right or wrong? One argument could be that by reducing liability on directors the workplace will become less safe. Another view is that by ensuring we place responsibility on the people who are closest to the problem we will better target the point at which better decisions can be made. Probably we will not know which until we have seen this operate for some time. Progress always seems to be so slow. Incentives also count – and the role of ACC, which has many benefits to our economy, also has some negative effects, somewhat masking the price signal in this case. I wonder if that will also get talked about.

More news:

Russell Hutchinson explains Non-Pharmac medicines coverage

AIA introducing a new excess option to AIA Private Health

AIA have updated Rules to Reinstate Policies

FSC Workplace Savings Half-Yearly Function 2025 is on 21 May

Financial Advice NZ are holding a 'Community of Practice: Central District' on 29 April

How to reduce chronic inflammation in your body

Eating well and getting regular exercise are most effective longevity tactics

Report finds deposit insurance scheme could see deposit interest rates fall significantly

Commerce Commission puts banks’ clawbacks, conversions and disincentives under scrutiny

Health Infrastructure Plan released, which sets out a national, long-term approach to renewing and expanding public health facilities

Quality Product Research: Research Advisory Board – Northern

Last month we held our first Research Advisory Board meeting of the year with our Northern Representatives and as usual returned to Quotemonster HQ with lots of valuable feedback. 

Board members: Allan Gillbanks (Owner, Director of The Quantum Group) and Katrina Church (Director, Head of Client Engagement of Insurance People)

Independent Chair: Tony Dench

Insurer Observers: Laura Fitzpatrick (Asteron Life)

Research Team: Russell Hutchinson, Doreen Dutt, Sara Alani and Kim Oliver

The research advisory board reviewed the following topics:

• Interim Cover: based on discussions, QPR will look to create some educational material on interim cover.

• The Addition of Legacy Research to our Standard Quote Flow: for improved clarity, we’ll review renaming ‘Legacy products’ to ‘Closed products’ and look to include a workflow to help advisers handle legacy products.

• Specific injury add-on compared to built-in for IP: we will review the value of Specific Injury as a built-in item vs a standalone item.

• Finalised Rating for Rural Key Person: we announced the launch of rural key person cover ratings for five providers - AIA, Asteron Life, Fidelity Life, Chubb Life, and Partners Life. Based on discussions, we will review the rating differences for some specific features. We’ll also gather feedback on the weighting for home modifications and vocational rehabilitation to ensure the ratings accurately reflects their value.

• The Proposed rating of disclosure: this is all about how easy it is to find policy documents on insurers’ websites and for customers to access all required documentation easily. We plan to review and rate this feature across all products in future.

• The Proposed rating of Waiver of Premium: members liked the idea of splitting up the different types of premium waivers and having them as separate items (injury {traditional WOP}, parental leave, unemployment, and redundancy being the main 4 categories). Our research team will look to implement these changes in our database in the next few months.

• Quote Functionality - Error Message / Exact Match vs Near Match: we’re looking into whether we’ll be able to implement near matches (rather than just exact matches) for products that are similar but not the same.

As always, the feedback from our Research Advisory Board meetings has been very valuable to our Research team and allows us to strengthen our research ratings by getting more insight into the adviser perspective. We look forward to meeting with our Central and Southern Advisory Boards later in the year.