AMP sell part of AMP Capital Private, and more daily news

It has been announced that 60% of the AMP Capital private markets investment business will be purchased by Ares Management. It was previously reported the non-binding sale was off the table. The new sale proposal is a more limited joint-venture that will allow Ares to acquire the majority stake in the AMP Capital infrastructure debt, real estate and other minority interests. This is stake is valued at A$2.25 billion. AMP will own AMP Capital’s public markets businesses, with the Multi-Asset Group transferred to AMP Australia.

“Ares Management will buy 60 per cent of the AMP Capital private markets investment business in a proposed deal announced this morning.

After ditching efforts to by all of the ASX-listed AMP in February, the US investment firm has instead opted for a more limited joint-venture arrangement to be explored over the next 30 days in a just-inked non-binding heads of agreement.

Under the deal Ares would acquire the majority stake in the AMP Capital infrastructure debt, real estate and other “minority interests” valued at A$2.25 billion, according to a release issued this morning.

“AMP will retain ownership of AMP Capital’s public markets businesses, which in FY 20 made a modest NPAT contribution,” the statement says. “The public markets strategy will continue, including the Multi-Asset Group (“MAG”) being transformed and transferred to AMP Australia, and actively exploring sale or partnership opportunities for the Global Equities and Fixed Income (“GEFI”) business.” Click here to read more 

In other news

Cigna: Cigna has announced multi-benefit promotion extended to 30 June 2021

Financial Advice: Concern adviser outreach may be shackled by FMA advertising rules

nib: nib conducting another review of existing members policies' exclusions and loadings. Members with special terms on their policies will be contacted by nib directly

Picture1


Legal and regulatory review for the life and health insurance sector

24 Feb 2021 – Trustees Executors’ newsletter advised of the recent publication of a final report by the Board of the International Organization of Securities Commissions (IOSCO) outlining nine sound practices for retail investor complaint procedures in financial markets.  The January 2021 IOSCO report is titled “Complaint Handling and Redress System for Retail Investors”. https://www.iosco.org/library/pubdocs/pdf/IOSCOPD670.pdf

25 Feb 2021 – Government and RBNZ announcements that the RBNZ is now required to consider the impact on housing when making monetary and financial policy decisions. https://www.beehive.govt.nz/release/reserve-bank-take-account-housing-decision-making


AIA Vitality enhancements on the horizon, and more daily news

AIA chief partnership insurance officer Sam Tremethick shared insights on AIA Vitality to mark the anniversary of the launch. Tremethick noted that AIA Vitality has been embraced by clients and the wider community. Although AIA has reported a high level of engagement, Tremethick has said that the insurer is looking to introduce enhancements next month. Tremethick described AIA Vitality as the cornerstone of what AIA does in terms of shared values.

““We’re over a year into Vitality being launched here in New Zealand, and the great thing is that the community and our clients have really taken to it,” Tremethick commented.

 

“We’re planning to release some further updates in March which will provide some further benefits to clients, and a further update will happen in June.”

 

“We’re continuing to evolve, but we’re already seeing some incredibly high levels of engagement,” he added.

 

“The release of the Apple Watch benefit last year also increased people’s interest in the programme, so we’re certainly continuing to come up with new ideas.”

 

Tremethick says that Vitality has been key to its mission of helping Kiwis improve their health and catch illnesses early, and he says the annual health check benefit and premium incentives have been very successful in promoting these goals.

 

“For us, Vitality is the cornerstone of what we do in terms of shared values,” he said.” Click here to read more

 

In other news

Financial Advice: Financial Advice has reported that they are continuing to develop new tools regarding disclosure, and looking to release it in the next 10 days

nib: 2 Months Free Health Insurance on any new Ultimate Health Max, Ultimate Health or Easy Health policy offer ends 28 February 

MBIE: MBIE has updated the FSPR with information on FAP linking


Legal and regulatory review for the life and health insurance sector

23 Feb 2021 – IRD released a special report on the new resurgence support payment legislation. https://taxpolicy.ird.govt.nz/news/2021/2021-02-23-special-report-resurgence-support-payment

24 Feb 2021 – Companies Office published the following notice on it FSPR website: https://fsp-register.companiesoffice.govt.nz/

FSPR online services will be unavailable from 5pm Tuesday 2 March 2021 to 8am Monday 15 March 2021 while we update the register to support the new financial advice regime that comes into effect on 15 March 2021.

During this period, you will be able to search the public register, but you won't be able to log in to your online services account to file, update, or access information regarding your financial service provider.

However, FSP’s wishing to give notice of their intention to apply for a transitional licence during this period can still do so. Shortly we will publish forms and information on how to apply during the outage.

23 Feb 2021 – Hone David Clark, Minister of Commerce and Consumer Affairs, diary released for January 2021, containing just 9 items, none identified as directly relevant to financial services. https://www.beehive.govt.nz/sites/default/files/2021-02/Min%20Clark%20Ministerial%20Diary%20January%202021.pdf

23 Feb 2021 – The Department of Internal Affairs advised that it is undertaking a review of sector specific guidelines for accountants, lawyers and conveyancers, and real estate agents, and is offering a survey for completion as a means to provide feedback on the guidelines. https://www.dia.govt.nz/AML-CFT-DNFBPs---Help-us-improve-our-guidance

15 Feb 2021 - The FMA released the Financial Markets Conduct (NZX Derivatives Market Rules) Approval of Rule Change Notice 2021. The notice came into effect from 15 February 2021.


FSC announce RBNZ outlook webinar, and more daily news

The FSC has announced that an outlook webinar will be held on 3 March 2021 to hear from Geoff Bascand, Deputy Governor and General Manager of Financial Stability. RBNZ’s first Monetary Policy Statement for the year is set to go ahead during the webinar. This means that webinar attendees will hear about the current economic as well as getting an update on cyber security and other key focus areas. During Q&A, the Deputy Governor will be joined by:

  • Richard Dean, Manager, Insurance Oversight
  • Andy Wood, Head of Supervision
  • Brendan Manning, Senior Adviser External Stakeholders

The agenda for the session is:

8.00am - Welcome from FSC Chief Executive, Richard Klipin
8.05am - Outlook 2021 with Geoff Bascand, Deputy Governor, Reserve Bank of New Zealand
8.30am - Fireside chat and audience Q&A with Geoff Bascand and Reserve Bank team

  • Richard Dean, Manager, Insurance Oversight
  • Andy Wood, Head of Supervision
  • Brendan Manning, Senior Adviser External Stakeholders

Click here to register

In other news

From Good Returns: Guaranteed medical cover policy wordings


nib report on interim results, and more daily news

nib New Zealand has reported on the half year results that were presented in a webcast by nib holdings limited. nib New Zealand CEO Rob Hennin has said that the results to 31 December 2020 were pleasing. Hennin noted that there were 3,135 new policies in the past 12 months, this is a 2.8% increase in health insurance coverage. nib also found that claims increased 7.6% as members were seeking medical care after lockdown. Hennin continued by explaining that $6.5 million claims catch-up provision has been released.

“nib New Zealand today announced its results for the six months to 31 December 2020 (1H21) with premium revenue up 7.9% to NZD$136.1 million and underwriting result1 of NZD$12.3 million broadly in line with same period last year (1H20: NZD$12.6 million).

nib New Zealand Chief Executive Officer, Rob Hennin said overall the result was pleasing with earnings stable as healthcare treatment bounced back following COVID-19 restrictions.

“Despite uncertain market conditions, over the past 12 months we grew New Zealand residents health insurance coverage by 2.8%, adding 3,135 new policies,” Mr Hennin said.

“Our first half result also shows claims increased 7.6% as members head back to their medical professional or seek treatment following first wave of COVID-19 restrictions.

“We know from our claims experience that many of our members either had healthcare treatment delayed or chose to stay away from hospitals during the peak of the pandemic,” he said.

“Its great members are now feeling more confident and getting the necessary healthcare treatment. Recognising some healthcare treatment in FY20 was simply deferred not cancelled during COVID-19, nib set aside a provision meet this expected claims catch-up over the course of FY21. As at 31 December 2020, NZD$6.5 million of the NZD$9.0 million provision has been released,” he added.

Hennin revealed since lockdown, neurological, cardio-thoracic surgery, diagnostics, and gynaecological claims have experienced the largest increase.  It was revealed that the nib Group member support package is more than $45 million.  The package includes:

  • financial hardship premium relief
  • suspension options
  • pre-approval extensions
  • expanded coverage
  • Lifeline Aotearoa and Clearhead support

The procedures that have experienced the largest increase following the initial lockdown (relative to pre-pandemic claims activity) were:

  • Neurological: 116% increase
  • Cardio-thoracic surgery: 49% increase
  • Diagnostics: 38% increase
  • Gynaecological: 36% increase

“To date our nib Group member support package totals more than $45 million, and includes financial hardship premium relief, suspension options, automatic six-month pre-approval extensions and expanded coverage for COVID-19 related treatment at no cost,” he said.

In other news:

Partners Life: Expressions of interest now open for our 3 day Virtual New Adviser Training Course - March 2021

FMA: Scams under-reported by Chinese New Zealanders: FMA


Australia: "ASIC boss should enforce rules not fantasise about setting them"

The Sydney Morning Herald had that powerful headline in a revealing piece about the future direction for ASIC as it enters upon the search for a new CEO. Link: https://www.smh.com.au/politics/federal/new-asic-chief-must-enforce-rules-not-fantasise-about-setting-them-hartnell-20210221-p574cs.html 


Legal and regulatory review for the life and health insurance sector

22 Feb 2021 – Privacy Commissioner released new guidance in relation to Privacy Principle 12 for sending personal information overseas, with the guidance in the form of two new interactive online tools to help organisations and businesses understand what they need to do. https://www.privacy.org.nz/publications/statements-media-releases/new-guidance-for-sending-personal-information-overseas/

19 Feb 2021 – RBNZ announced amended dates for statistical releases as follows:

Survey

Series

Original date

New publication date

New mortgage commitments - LVR

C30-35

29 January

19 February


Bank balance sheet
 

C5, C50-52, S10-41

29 January

23 February

Non-bank lending institutions

T1, T4, T11, T21,
T31

29 January

23 February


Insight into FSPR usage, and more daily news

MBIE has published a document covering adviser and FAP responsibilities under the new regime. The document first sets out the rules of engagement, stating that every adviser must be engaged or linked to a FAP. Advisers must ensure the FAP registers the engagement on the FSPR. But to link to FAPs, advisers must first provide the FAP with their name and FSP number.

 From 15 March, advisers must have these things before linking to a FAP:

  1. A RealMe® login
  2. An online services account with the FSPR
  3. Authority to update records on behalf of the financial advice provider

In order for advisers and FAPs to engage, FAPs must:

  1. Log in to your online services account using your RealMe ID and password, and locate your registration in the ‘FSP Registrations’ tab of your dashboard.
  2. On the ‘View FSP details’ screen, select the ‘Financial Services’ tab and click the ‘Maintain Financial Services’ button.
  3. Scroll down to the ‘Financial advice service’ where you’ll see the FAs, if any, that you’re linked to.
  4. Click the ‘Add Financial Adviser’ button and search for the FA you wish to engage, using their FSP number or name. Select the FA from the drop-down list, and indicate whether or not they will be covered by your dispute resolution scheme (DRS).
  5. Repeat step 4 above for each new financial adviser you add. Please note, multiple advisers are displayed alphabetically. (Cont.)
  6. When you’ve finished updating your registration, click on ‘Next Step: Declaration’. Review and confirm the declaration.
  7. Click on ‘Next Step: Review’. Review the information you have entered and tick the check box to confirm the information is true and accurate
  8. Click on the ‘Submit’ button at the bottom right of the screen.
  9. Viewing the FAPs financial services, you’ll see that the FAs now appear on the ‘Financial Services’ tab.

To support the new regime being implemented, the FSPR will also be updated. The Companies Office will release guidelines and videos to help users closer to the date.

This video shows the engagement process.

In other news

Fidelity Life: Dan Wilkinson joined Datacom #RightCloud panel

Cigna: Multi-Benefit Discount promotion that applies a discount up to 7% on Life Cover or Life Income Cover with an additional benefit is set to end February 28, 2021

Partners Life: Is data the key to understanding underinsurance?


Asteron Life set to run regulatory webinars, and more daily news

In response to high demand, Asteron Life is set to run three webinars focused on the upcoming regulatory changes. The webinar will walk advisers through the new requirements and will help them understand what they need to do. Asteron Life has noted that templates for the new process will be available. The three webinars will be held on:

  • Monday 22 February at 1pm
  • Tuesday 23 February at 11am 
  • Tuesday 23 February at 1pm

With just weeks to go, this webinar will step you through the new requirements and help you understand what you need to do. Because each FAP and adviser has different information to disclose, Asteron Life cannot provide templates for the new process.

If you haven’t yet thought about this vital requirement or are still a bit unsure, please enrol for this webinar today - there are three available sessions for you to choose from, click here to register for one now. 

In other news

Partners Life: Naomi Ballantyne hosted a digital ‘Fireside chat’ during Level 3 to discuss things happening within the industry

Financial Advice: Financial Advice made a submission on the proposed guidance on the advertising offers of financial products under the Financial Markets Conduct Act 2013

Insurance Advisernet Australia: Insurance Advisernet Australia celebrates its 25th year

AIA: AIA is in search of a qualified actuary with experience in pricing to join on a 12 month contract

Gen Re: Finding a Way Forward for Disability Income Insurance in Australia - Is IDII Functioning Sustainably Elsewhere?

RBNZ interns

RBNZ: RBNZ farewells Summer interns


Legal and regulatory review for the life and health insurance sector

18 Feb 2021 – Privacy Commissioner newsletter confirmed that Privacy Week 2021 will take place 10-14 May 2021.

18 Feb 2021 – The former Minister of Commerce and Consumer Affairs, Hon Faafoi, released his diary for September 2020, being the final full month before the election held on 17 Oct, with the following potential financial services sector related meetings noted:

  • 1 Sept 2020 - Meeting with Hon Little, NZX and FMA (Mark Peterson and Rob Everett)
  • 15 Sept 2020 – Meeting with FMA (Mark Todd, Rob Everett and Edwin Mitson)

https://www.beehive.govt.nz/sites/default/files/2021-02/Hon%20Kris%20Faafoi%20-%20Proactive%20Diary%20Release%20-%20September%202020%20.pdf

17 Feb 2021 – FMA media release stating that the FMA fears Chinese New Zealanders are under-reporting investment scams. https://www.fma.govt.nz/news-and-resources/media-releases/under-reporting-investment-scams/


What should advice cost?

What should advice cost? That was an excellent question from the audience during the first two of our recent getting in shape series. Perhaps this seemingly simple question surprised our panel. The answer to the question is not easy. It was a kind of sub-plot in the day's event: the question of the cost of advice is part of the disclosure story, part of the story about the future of advice, part of the story about the value of advisers solidly backed up by the research shared on the day. When asked what advice should cost the panel made a good beginning - in both Wellington and Auckland the first answer was "it should not be free". This echoed John Botica's  earlier comment during the first panel in Wellington where, talking about disclosure, he asked that any advisers taking commission should not refer to their advice as free. Of course advice isn't free. Often something that is not paid for is not valued. Advice is paid for (whether by fee or commission) and it is valuable. 

The question came up in the context of a discussion about how to make advice more accessible. For people to value advice they must first know it is available, believe it is worth getting - but these are just pre-conditions. Often we know something would be good for us, but don't do it.

Many people struggle with making the time to meet with an adviser - not just because of the time for the meeting, but they fear the time the work around the meeting will take. A good portion of the population are certain that their finances are a mess, and if not, then the musty file of papers definitely is a mess. So they fear judgment. Many people struggle with making room for the cost of advice. If they believe that it will require payment at the time and their budget is already stretched they will be reluctant to make an appointment. Commission has a valuable financing role to play here - but it is not the only mechanism, of course, that can make access to advice easier. 

So although advice should not be free, we need to make it easy to start the process. Which means the initial steps should be free - and easy to do.

Most advisers offer initial discussions at no charge. More can be done to make brief trials of the value of advice accessible. Social media helps, Zoom and MS Teams helps, but nothing quite beats a meeting - and the ability to slip into a 20 minute session on KiwiSaver at lunch or hear ten top tips on managing your home loan at the local mall are probably under-utilised strategies. Now add some tools in the client's first language (which will not be English in about a third of cases in Auckland) and spoken by someone who at least knows your culture a bit... these are access strategies. They reduce the psychological costs (fear of rejection, fear of shame, fear of being exposed as not having 'enough money to qualify for advice'). 


Southern Cross highlights CareHQ, and more daily news

Southern Cross is reminding advisers and members of the CareHQ service. CareHQ is designed to make virtual medical consultations with  New Zealand GPs possible. CareHQ operates from 7am-7pm everyday. The consultations are possible via the CareHQ app. Southern Cross members are able to redeem a 15% discount on the standard price of $65.  Click here to find out more

 

CareHQ can connect your team with trusted medical care, quickly – 7 days a week, 7am-7pm. With the CareHQ app your team is only a few taps away from a virtual GP consultation. And Southern Cross members get a 15% discount if they access CareHQ via the My Southern Cross app – that’s a saving of $10 per consultation off the standard CareHQ price of $65.

 

In other news

 

Congratulations to nib and Pinnacle Life for digital excellence awards, from Insurance Business Mag: Insurance Business New Zealand Awards – winners revealed 

Strategi: On track for 15 March? Check your readiness with our February report card


Asteron Life SME insurance index 2020 findings, and more daily news

Asteron Life’s insurance index 2020 provided insight into the insurance-related decisions made by SMEs. The index illustrated that the number of SMEs with multiple life insurance cover decreased when compared to the findings of 2019, with 38% of SMEs having only one life covered in 2020 and 32% of SMEs having only one life covered in 2019. The index highlighted a decrease in SMEs seeking advice from financial advisers and insurance companies and an increase in independent navigation. The findings of the index conclude that SMEs that received advice were more likely to have a broader range of cover. Of the SMEs that sought advice from advisers, 89%  had life insurance cover, 50% had IP cover, 66% had trauma, illness, cancer cover and 50% had TPD cover. Of the SMEs that didn’t receive advice, 88% had life insurance cover, 27% had IP cover, 43% had trauma, illness, cancer cover and 27% had TPD cover. Click here to see all findings of the 2020 index

 

In other news 

Russell’s piece in Good returns: Data versus human

FMA: Insurance Business "ANZ admits to misleading customers about credit card insurance"

 

 


New FSC research findings, and more daily news

FSC CEO Richard Klipin presented the findings of new research at the FSC Get in Shape summit last week. Unlocking the Potential of Professional Financial Advice was centred around the response of those within the industry to the following questions:

·       How do you feel on the other side of Covid?

·       How ready are you for upcoming regulation changes?

·       What is your outlook for the future?

Klipin noted that findings indicated that the industry is in a time of change with a transition from a sales led approach to an advice led approach. With this change it expected that there will be changes to business models, remuneration models, and client connection methods. The research also showed that advisers had a positive outlook on thepost-COVID-19 reality. 

FSC CEO Richard Klipin unveiled the new research entitled, “Unlocking the Potential of Professional Financial Advice” at the FSC: Get In Shape events this week.

The research shows that the financial advice sector has remained resilient despite the challenges of Covid and regulatory change while continuing to provide ongoing value to Kiwis.

The FSC research committee asked the advice community three questions.

1. How do you feel on the other side of Covid?

2. How ready are you for upcoming regulation changes?

3. What is your outlook for the future?

Klipin said that the conclusion of the research was that “We are in a huge moment of change. We are moving towards the much more level footing of an advice-led [rather than a sales-led] conversation.

“Because of this, business models, remuneration models, how advisers connect with their clients are all going to change. It feels like this moment is unleashing an incredible opportunity for the industry.”

As well as reaffirming previous research that highlighted the benefits of financial advice during times of turmoil, the research also showed that advisers were feeling that they could weather the post-Covid storm.

“What we saw in Covid was a change in how people operated their businesses. The key change in this sector has been the pick up and the take up of technology.

 

The research found that many advisers are preparing themselves for the upcoming regulatory changes, with 57.5% of advisers reporting that they were preparing for changes relating to FSLAA and 32% of advisers saying that they would be ready when the law came into place. The research also highlighted that there generally was a positive response to the upcoming change.

When looking at how ready advisers are for regulation change the numbers are looking even more positive.

“At the end of last year, 57.5% of advisers said that [they] have continued to ready themselves to implement the required changes in FSLAA, 32% said they will be ready when it begins.

“This notion in some parts of the sector [that some are] wondering how ready are people? How many people are out there not doing anything? This data says that most advisers are well down the track.”

According to the research most advisers have a positive outlook for the future. Many of the respondents felt that the incoming regulation changes are positive for customers, and for advisers bothClick here to read more

FSC findings

In other news

FSC: in response to the Lockdown announcement and upcoming regulatory changes, the FSC will be running a Zoom session for those registered for the Christchurch and Dunedin Advice Summits on Wednesday 17 February 2021 from 08.00 until 10.00.

The Zoom session schedule is:

0800:  Welcome from FSC, CEO Richard Klipin

0805:  Opening Session: Hon Dr David Clark, Minister of Commerce and Consumer Affairs

0815:  Embedding the changes in the New Zealand Advice Sector

0905:  Comfort break

0910:  Disclosure – Focusing on your responsibilities ahead of 15 March 2021

0935:  Helping New Zealand’s advisers to grow – tools, tips and insights

0955:  Close - FSC, CEO Richard Klipin

 


Legal and regulatory update for the life and health insurance sector


Chatswood operating at alert level three

With the move to alert level three travel plans for this week have been cancelled. I shall be in touch with each of you to reschedule meetings that were planned for in-person with either Zoom or a tentative alternative date.  Staff are all used to working from home now and are well set-up to do so. We will clear messages and divert the office phone but you may still require mobile numbers to quickly reach Jerusalem, Kelly, Fran, Melissa, Ed, or me - feel free to drop us an email and ask if you do not already have these. 

If you are at an insurer and would like us to help publicise any event changes due to the alert level change please let us know we are happy to blog those for you. 

 


Current FMA vacancies

The FMA is currently looking to fill a number of positions within the organisation. The FMA is seeking an experienced accountant to join the Auckland team as a permanent full-time employee.  There is a search for a new Wellington based Intermediate Solicitor, Enforcement. The FMA is in search for a permanent full-time Senior/Adviser Offer Disclosure in both Auckland and Wellington. A new Head of Investment Management in Auckland and Wellington is set to be recruited.


AIA Cancer Care announced, and more daily news

AIA has announced the introduction of AIA Cancer Care. AIA highlights that the Ministry of Health reported that 23,000 New Zealanders are diagnosed with cancer each year. AIA is offering customers the option of purchasing AIA Cancer Care. AIA Cancer Care will cover the medical expenses relating to diagnosis, treatment and recovery. Benefits of AIA Cancer Care include unlimited cancer surgical benefit, access to specialist consultations, diagnostic tests and Pharmac as well as non-Pharmac Medsafe indicated cancer chemotherapy drugs. Customers with eligible policies will be able to join AIA Vitality and earn Airpoints from premiums paid.

Key benefits include:

  • $500,000 extensive cover for cancer treatment and recovery
  • Access to Pharmac and non-Pharmac Medsafe indicated cancer chemotherapy drugs
  • Options to have treatments overseas

“In New Zealand 23,000 people are diagnosed with cancer each year1. While this is an alarming statistic, many cancers can be successfully treated if diagnosed early. In the unfortunate event that you’re diagnosed with cancer, having more choice and control over your treatment plan can make your journey to recovery much easier.

AIA Cancer Care will take care of medical expenses associated with the diagnosis, treatment and recovery of cancer. This includes access to an unlimited cancer surgical benefit, access to specialist consultations, diagnostic tests and Pharmac and non-Pharmac Medsafe indicated cancer chemotherapy drugs.​

With eligible policies you also get the added benefit of earning Airpoints Dollars™ for premiums paid, and have the opportunity to join AIA Vitality, a science-backed health and wellbeing program that rewards your healthy choices.” Click here to read more

AIA Cancer Care 11 Feb 2021 2

In other news

Generate: From FMA to Generate

Kiwi Adviser Network: Make running your advice business effortless

nib environmental and waste report