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Financial Advisers Account for Less than 50% of New Life Insurance Sales

Third-party Financial Advisers are probably less than 50% of the sales of life products. Although there is no industry standard approach to defining channels and sharing sales data by channel a reasonable model can be constructed using existing industry data.

The approach starts with deducting business from the total for companies which deal with no third-party advisers, such as BNZ Life, CIGNA, and similar.

Then you deduct the share of 'bank' business from OnePath and Sovereign business. Until recently the estimate could only be based on vague statements made by each company or estimates by other parties. However, recently ANZ published the data in a briefing for share analysts, which helped to make the model much more accurate. 

At this point the model already suggests that bank business is about 40% of all new life insurance sales and direct is about 10%. Not all the remaining business can be sold by third-party advisers: these companies also have institutional business divisions. These are deals to distribute insurance through companies such as The Warehouse. Although there is too little data on which to make a serious estimate it is plainly greater than nothing - these divisions are long-running features of several insurers' operations. Therefore third-party adviser business must account for less than half of all new business. 

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