Trauma Take-up
Inputs versus Outputs - which counts in your insurance?

Inhouse Agencies

The news that Friends in the UK has set up an inhouse agency may remind New Zealand life insurers that they could be a solution. Our problem is a market in which possibly nine tenths of insurance brokers have decided to avoid giving investment advice, and yet a good proportion of their clients (and clients of insurers) will seek it. That leaves the insurer with a problem.

Often the client will ask the insurer a question which requires an AFA to answer - and it may equally often take them outside the insurers product scope.That means even an in-house staff member trained to AFA level won't be sufficiently skilled to answer the question - it must actually be someone practising as an AFA who could source relevant product to meet the client's requirements and has the competence that can only come from actual practice.

It simply isn't possible to audit every adviser for an effective referral relationship. Sooner or later the company will need to have an option. Will it refer outside on an ad hoc basis? Will it create a systematic referral to a single third party agency? Or will it develop an in-house agency? There are strengths and weaknesses in each approach: but the third option definitely needs to be considered.

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