AIA announce four new national sales manager appointments

AIA has made four new appointments within their Distribution team.

Aaron Gilmore has been appointed National Sales Manager, Retail. Gilmore has been with AIA since 2023 and has been an AIA Vitality Coach and Northern Region Manger, Business Development.

Carley Ellis has been appointed National Sales Manager, Aligned Advice. Ellis has 20 years of experience in New Zealand’s financial services industry and has a proven track record in business development, financial advice, and leadership.

Sarah Hepper has been appointed National Sales Manager, Corporate Solutions. Hepper has over 25 years of experience in the insurance industry, and has spent the past 15 years contributing to the growth of Corporate Solutions at AIA NZ

Nick Russell has been appointed as National Sales Manager, Home Loans. Russell has extensive experience working alongside home loan advisers.

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AIA Trauma Buy-back Enhancement

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Government announces changes to KiwiSaver  

The FSC welcomes decision to increase default KiwiSaver contribution rate

Financial Advice NZ webinar 'Data-Informed Decisions for Private Health Insurance' 28 May

FSC Investment and KiwiSaver Committee meeting on 3 June

Financial Advice NZ webinar 'Finding the Guard Rails in a Principle-based Advice Regime: Running a Licensed Business' 4 June

Michelle Russell and Tim Horgan step into permanent leadership roles at ANZ

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Best product, no. Best solution, yes!

We are in enthusiastic agreement with Steve Wright’s recent article, in which he questions what makes the best product in his latest article on Good Returns. Steve advocates that the FMA and Disputes Resolution Service need to debunk the view of advisers that they sell only the ‘best’ product as rated by independent services.

As a research business, we are happy to debunk the notion that we tell people what to sell, or ‘rank’ products. We go to great pains to point out that this is not our job, we understand that our role is to provide useful information about the meaningful differences between products to enable advisers to have better conversations about suitability. We will never tell you what product to recommend because only financial advisers can give financial advice. To quote directly from a slide from our recent roadshow:

We also highlighted the importance of recognising the financial adviser’s unique role in the process of reconciling objectives with options and choices and limitations to arrive at a good solution, which is nearly always a compromise, unique to the client. That’s the essence of suitability assessment, entirely within the financial adviser’s legally defined role. If you haven’t heard us talk through the leading car purchase example, join us at a training session coming soon!

Like Steve, we believe that the best product is the one that suits the specific clients’ needs – even if it’s not the most generous, or the highest rated. He stresses that advisers must thoroughly understand a client’s individual circumstances, risks, and goals to come up with the most suitable product, then give enough detail that the clients can understand the advice and the products recommended.

What are some examples you’ve come across of products that at first look may not be the ‘best’, but actually have been the best fit for your clients?

If you have missed some of the comments on Steve’s article, we particularly like these:

“Advisers must give financial advice that I'd suitable… suitability has a lot more to do with the client circumstances than stars”

“In short, I don’t believe that we should be looking for who’s the “best.” I believe we should be looking for the “best fit.” And that’s a very different thing!”

“It's a good discussion point, but if you want a more realistic glimpse of what is likely to happen here in the future, speak to those involved in the Australian market about the removal of the 'safe harbour' provision in their financial advice regulation. Not only is it likely that product research into features and benefits likely to become more necessary, not less, but it also seems more and more likely that the actual underwriting terms offered across the entire market will need to be considered.”

More news:

Financial Advice NZ upcoming webinars and workshops - Data Informed Decisions & Demonstrating Suitability of Advice for Private Health Insurance 28 May, Navigating the Complexities of a Blended Family 11 June, Ethics Workshop 12 June, Understanding Portfolio Investment Entities (PIE’s) 25 June, Tackling the Tough Questions 25 June

Apex Advice partners with Pathfinder to expand ethical KiwiSaver investment options

The Co-operative Bank comes top in customer satisfaction survey

Legal and regulatory update for the life and health insurance sector

29 Apr 2025 - The FMA have published key takeaways from the CrowdStrike event survey​, which investigated how well financial service providers were prepared for and responded to the CrowdStrike incident. https://www.fma.govt.nz/library/research/key-takeaways-from-the-crowdstrike-event-survey/

1 May 2025 - The RBNZ has published its response to submissions on three of the four core standards that set the prudential requirements deposit takers will need to meet in order to be licensed under the Deposit Takers Act 2023 (DTA). The response covers liquidity, disclosure, and Depositor Compensation Scheme (DCS) related requirements.   https://www.rbnz.govt.nz/hub/news/2025/05/reserve-bank-publishes-response-to-deposit-taker-core-standards-consultation

1 May 2025 - Cabinet has agreed to designate banking as the first sector under the Customer and Product Data Act. https://www.beehive.govt.nz/release/better-banking-competition-one-step-closer-kiwis

2 May 2025 - Westpac is to pay a penalty of $3.25 million for misleading customers entitled to advertised discounts as well as overcharging some of its business customers. Westpac admitted its conduct in civil proceedings brought by the FMA at the High Court in Auckland in December 2024. Westpac’s breaches of the fair dealing provisions under the Financial Markets Conduct Act 2013 (FMCA) affected a total of 24,621 customers and resulted in $6.35m in overcharges. https://www.fma.govt.nz/news/all-releases/media-releases/westpac-to-pay-3-25-million-penalty-for-misleading-customers/

5 May 2025 - The RBNZ publish a special topic from the May 2025 Financial Stability Report - Rise of the machines: How could artificial intelligence impact financial stability. https://www.rbnz.govt.nz/hub/news/2025/05/rise-of-the-machines-how-could-artificial-intelligence-impact-financial-stability

5 May 2025 - ASIC has unveiled a new digital portal to allow applicants to apply for an Australian financial services (AFS) licence. https://asic.gov.au/about-asic/news-centre/news-items/asic-launches-new-portal-for-australian-financial-services-licensees/

5 May 2025 - The FSC publish KiwiSaver Industry Spotlight March 2025. https://blog.fsc.org.nz/kiwisaver-spotlight-march-2025

5 May 2025 - The FSC publish Life Insurance Industry Spotlight March 2025. https://blog.fsc.org.nz/lifeinsurance-spotlight-march-2025

6 May 2025 - The Credit Contracts and Consumer Finance Amendment Bill had its first reading and was referred to select committee. https://bills.parliament.nz/v/6/6193a33c-40d6-4354-0d5a-08dd6ff875cc?Tab=history

7 May 2025 - Risks to the financial system have increased over the past six months, Reserve Bank Governor Christian Hawkesby says in releasing the May 2025 Financial Stability Report. https://www.rbnz.govt.nz/hub/news/2025/05/risks-to-the-financial-system-have-increased

7 May 2025 - The RBNZ is consolidating the structure of its Executive Leadership Team (ELT). The new ELT structure, which takes effect from Monday, 12 May 2025, is made up of four roles:

• Assistant Governor Financial Stability

• Assistant Governor Money Group

• Assistant Governor Enterprise Services

• Assistant Governor Operations

https://www.rbnz.govt.nz/hub/news/2025/05/rbnz-executive-leadership-team-changes

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.

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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

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.

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Russell Hutchinson explains Non-Pharmac medicines coverage

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

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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

Strategi Group white paper outlines ways for FAPs to future-proof their business

Strategi Group have released a white paper Next Gen Advice: Future-Proofing Your Business For 2030, which explores evolving trends shaping the future of the financial advice industry and outlines practical steps for FAPs to future-proof their business. The findings from the report were presented at the 2025 National Adviser Conference – Shaping the Future of Advice.

Firms that thrive in 2030 will look very different to those operating today – the paper explores what a ‘Next Gen’ advice business will look like – a FAP that uses technology, marketing, outsourcing, people and governance/compliance to their advantage.

Unsurprisingly, technology advancements will be more widespread and better incorporated in 2030 – whether that’s AI agents handling administrative tasks such as scheduling appointments and answering client queries or calls being recorded, transcribed and summarised into client summaries and adviser’s file notes.  Video is anticipated to play a greater part, with SOA’s predicted to be delivered as video presentations incorporating interactive, scenario-based calculators and past video calls available to be retrieved via a secure app. Leveraging data analytics and AI will enable hyper-personalised advice aligning to each client’s goals and life stages.

The report cautions that AI rollouts need to be approached with careful thought and planning around

• current and future expected markets and how they prefer to engage;

• how to ensure AI integration is seamless, scalable and easily upgradeable;

• privacy, security and compliance needs being fulfilled;

• hardware capability;

• upskilling staff;

• implementing new technologies in a way that ensures smooth transitions and minimal disruption.

To successfully market themselves, FAPs need to decide if they will be specialists who focus on a single product area and establish themselves as experts or generalists who can save clients time by simplifying all the financial aspects of a client’s life. In both instances, FAPs will need to focus on providing proactive advice that anticipates and helps prepare clients for their future financial needs, opportunities and challenges.

The report predicts successful FAPs will have larger client numbers but use fewer staff to manage them, with non-core tasks being outsourced to specialist providers. Currently, functions such as accounting, payroll, IT & data security, data storage and CRM, research, marketing and investment platforms are commonly outsourced. In future, Strategi envisages further areas for outsourcing to be compliance, AML/CFT, technology integration, training, HR and back-office admin.

Effective governance is critical to help future-proof advice businesses. While small firms may rely on a trusted professional consultant, mid-sized firms may need independent directors to be appointed. The report predicts that compliance providers will play a crucial role in helping firms adopt new technologies while ensuring that their advice processes remain compliant with evolving regulations. Improving governance competence, knowledge and skill and planning for governance scalability as businesses grow will be key to succeed.

Implementing these steps will allow the FAP of the future to spend less time on admin and more time engaging with clients.

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David Whyte says licensees will need to continue to invest in the systems behind their Fair Conduct Programmes

The schedule of webinars for Privacy Week has been released

Legal and regulatory update for the life and health insurance sector

23 Mar 2025 - The FMA now publishes monthly market engagement undertaken by the FMA on their website. https://www.fma.govt.nz/business/

25 Mar 2025 - New research commissioned by the RBNZ has highlighted barriers that can prevent some New Zealanders from opening bank accounts. The research, titled First steps to financial inclusion, explored opening bank accounts from the perspective of frontline bank staff and customers. It found that certain groups were reported to be most likely to find it difficult to open a bank account, including recent migrants, rural communities, the elderly, people with disabilities, and trusts (including Māori trusts). https://www.rbnz.govt.nz/hub/news/2025/03/new-report-suggests-that-collective-action-is-needed-to-improve-access-to-bank-accounts

25 Mar 2025 - Customer and Product Data Bill completes third reading. https://bills.parliament.nz/v/6/770A5F4E-2185-4F1F-1395-08DC75512299?Tab=history

26 Mar 2025 - The FMA are consulting on a range of class exemption that are due to expire before the end of 2026.  https://www.fma.govt.nz/business/focus-areas/consultation/expiring-class-legislative-notices/

27 Mar 2025 - The committee stage of the Privacy Amendment Bill was completed. https://bills.parliament.nz/v/6/56e3fbe7-1f3d-464e-b54d-08dbae8917ae?Tab=history

27 Mar 2025 - The Chief Ombudsman Peter Boshier has released his final report to Parliament. https://www.ombudsman.parliament.nz/news

AI becoming more trusted by executives

SAP investigated how US executives were using AI in their organisations and their trust in the technology. They found that AI has become embedded in work practices (with 63% of executives using generative AI daily) and is changing how people do business.

Decisions are being made based on AI insights, with 44% of C-suite executives saying they would override a decision they had already planned to make based on AI insights and another 38% trusting AI to make business decisions on their behalf. 74% of executives had more confidence in AI advice over advice from family and friends. And a massive 55% of executives say in their company AI-driven insights have replaced or bypassed traditional decision-making.

Some common tasks carried out by generative AI tools include:

• Analysing data and making recommendations for decision-making (52%)

• Spotting risk or issues they hadn't previously considered (48%)

• Offering alternate plans (47%)

• Enhancing product development (40%)

• Supporting budget planning (40%)

• Performing market research (40%)

SAP found that there were positive implications on employee wellbeing, with 39% of executives reporting better work-life balance, 38% reporting improved wellbeing and 31% reporting reduced stress.

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SortMe Advisor Portal, a tool designed to enhance financial advisory services, launches

AIA launch new Guide to Medical Underwriting

28% of large organisations rank AI-generated cyber threats as a major risk

Outgoing Chief Ombudsman identifies significant concerns with Health NZ’s delays and administrative processes around OIA requests

Munich Re delve into AI’s impact on Healthcare

As part of Munich Re’s Life Science Report, they have investigated the projected impact of Artificial Intelligence (AI) on healthcare, from disease prevention to diagnosis to treatment as well as the implications for efficiency gains.

While the news is mostly good (improved mortality, better prevention, earlier diagnoses, individualised therapies), it does create some challenges for life and health insurers. With earlier diagnoses and the emergence of new disease classifications, critical illness insurance products will need continuous updating. Claims management and policy development will become more complex, as genetic and molecular diagnosis becomes more routine, requiring a higher level of medical expertise. Overdiagnosis (the detection of diseases that don’t impact on mortality and/or morbidity) and antiselection may become problematic.

AI will also create opportunities for insurers. Insights from accessing and analysing vast datasets including electronic health records, imaging and other biomedical sources will transform the understanding of the root causes of disease and in turn allow underwriting to become more accurate and sophisticated. Wellness interventions will be able to be better targeted and increase in scope and effectiveness.

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Profile of Josh Bronkhorst, CEO of Link Financial Group

Entries for Insurance Business’ annual Top Insurance Employers close 14 March

InvestNow’s Retirement Readiness Index recorded an average confidence level of 50.4%

Kiwibank reports NPAT of $92 million for the six months ending 31 December 2024

New framework moves beyond traditional reliance on BMI as a sole indicator of obesity

GlobalData projects the life insurance market in New Zealand will grow

GlobalData, an international data and analytics company, has projected the New Zealand life insurance market to grow from $5.9 billion in 2024 to $8.3 billion in 2029, equating to a compound annual growth rate of 7.0%, in terms of gross written premium. It expects the New Zealand life insurance market will reach $6.4 billion in gross written premiums in 2025.

The largest driver of growth is expected to be life personal accident and health, with an expected compound annual growth rate of 6.9% between 2025 and 2029 driven by rising healthcare expenditure and corresponding premium increases.

GlobalData puts the increased demand down to factors including an aging population, heightened health awareness and the rising cost of living, which have increased the need for financial protection, though they caveat their projections, saying high unemployment and inflation could pose risks to this growth.

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Applications for Fidelity Life’s Career Connect 2025 intake are open

The ‘Get AIA Vitality and Start Thriving’ brand campaign is back