New Zealand’s protection gap according to Sharron Botica, and other daily news

A recent report suggests New Zealanders are under-insured by hundreds of billions of dollars. Spinoff asks Sharron Botica from AIA New Zealand to explain why it’s so important to make up the shortfall.

“Customer insight work carried out by AIA has told us that people often feel protected against death, illness and other physical circumstances because they feel they can lean on whānau and community to help out. But this isn’t always realistic, and it can be a dangerous mistake that could leave that support network severely and unexpectedly cost-laden.

According to a Financial Services Council NZ report from 2020, 71% of New Zealanders are under-insured when it comes to life insurance.

….. we drastically underestimate how much financial pressure is created when a household loses half of its income.

In 2018, the retirement commissioner Diane Maxwell said the New Zealand “she’ll be right” attitude could be playing a part. That attitude has major consequences and leaves your loved ones to carry a heavy burden.

While relying on savings is a common plan in case of a significant event causing a loss of income – the proverbial “rainy day fund” – you need to have savings to use. Data from Stats NZ showed New Zealanders typically don’t have great savings, with just 0.4% of income being saved over the quarter ending March last year."

More daily news:

FSC says NZ Income Insurance Scheme needs "more time"

Southern Cross wins Organisational Change & Development award at the NZ HR Awards 2022

Jackie Waddams appointed as General Counsel for AIA New Zealand

FANZ’s 1 June webinar covers key insights, updates and best practice for insurance advisers, register here.

Goodreturns: JP Hale thinks he knows why your clients are unhappy


Legal and regulatory update for the life and health insurance sector

28 April 2022 - Minister of Commerce and Consumer Affairs, Hon David Clark, March 2022 diary released with the following potential financial services sector related meetings noted:

  • 16 March 2022 – Financial Markets Authority (Mark Todd, Chair, Samantha Barrass, CE)
  • 16 March 2022 – Fincap  (Ruth Smithers, CE and Jake Lilley, Senior Policy Adviser)
  • 18 March 2022 – NZ Bankers Association Council (Hon Grant Robertson, NZBA members)
  • 30 March 2022 – Speech at Open Finance Report Launch (Video conference attendees)
  • 30 March 2022 – Retirement Commissioner (Jane Wrightson)

https://www.beehive.govt.nz/minister/hon-dr-david-clark


Legal and regulatory update for the life and health insurance sector

14 April 2022 – Commission for Financial Capability highlighted that the Cancer Society and Sorted.org.nz have teamed up to create a new financial and legal resource for New Zealanders facing a serious or terminal diagnosis. The recently launched life guide is the first step towards helping make the financial journey of patients easier to navigate. https://retirement.govt.nz/news/latest-news/families-with-a-serious-illness-are-feeling-financial-pressure-more-than-ever/

14 April 2022 – NZ Markets Disciplinary Tribunal released its 2021 Annual Report. https://www.nzx.com/announcements/390588


Legal and regulatory update for the life and health insurance sector

12 April 2022 – Retail Payment System Bill read a second time in Parliament. https://www.parliament.nz/en/pb/bills-and-laws/bills-proposed-laws/document/BILL_116198/retail-payment-system-bill

12 April 2022 – Financial Service Council (FSC) press release highlighted the publication on 4 April 2022 of the latest FSC research report titled, “Money & You – The Lost Generation?” https://blog.fsc.org.nz/research-reports-2022-money-and-you-the-lost-generation

12 April 2022 – Commission for Financial Capability highlighted Sorted’s release of the entirely rebuilt KiwiSaver fund finder (a mashup of a previous comparison engine of the same name with the platform’s fees calculator) that configures and adapts to KiwiSaver investors’ risk profile and circumstances, aiding them in comparing fund options across the entire KiwiSaver market. https://retirement.govt.nz/news/latest-news/kiwisaver-comparison-engine-revamped-to-project-fees/


Legal and regulator update for the life and health insurance sector

4 April 2022 - Minister of Commerce and Consumer Affairs, Hon David Clark, January and February 2022 diary released with the following potential financial services sector related meetings noted:

  • 2 Feb 2022 – ASB (Vittoria Short, CEO; Craig Sims, Executive GM; Debbie Mills, Tribe Lead Home Ownership & Louise Griffin GM Govt Relations)
  • 2 Feb 2022 – Kiwibank (Steve Jurkovich, CEO; Liz Knight (CRO); & Mike Hendriksen (CLO))
  • 2 Feb 2022 – BNZ (Dan Huggins, CEO; Sam Perkins, Chief Risk Officer; Martin Elliott, GM Consumer Product Lending Domain; Dean Schmidt, Exec, Commercial Services and Responsible Business; Paul Hay, GM, Regulatory Affairs; Dirk McLeish, GM, Line 1 Control and Assurance)
  • 2 Feb 2022 – Westpac (Catherine McGrath, CEO, Westpac; Clayton Cosgrove)
  • 2 Feb 2022 – ANZ (Antonia Watson, CEO; Peter Parussini, GM Public, Consumer and Govt Affairs; Ben Kelleher – MD, Personal Banking; Cushla Scholfield,  Associate General Counsel; Andrew Gaukrodger  - Govt Relations & Corporate Responsibility)
  • 9 Feb 2022 – IAG (Bryce Davies, Corp Relations and Amanda Whiting, CEO)
  • 9 Feb 2022 – Financial Advice NZ (Heather Roy, Chair and Katrina Shanks, CEO, and John Bolton, Director)
  • 10 Feb 2022 – FinCap (Ruth Smithers, CE)
  • 17 Feb 2022 – Speech to FSC Future Ready Advice Summit

https://www.beehive.govt.nz/minister/hon-dr-david-clark

4 April 2022 – Government announced a new round of sanctions announced targeting Russian oligarchs. https://www.beehive.govt.nz/release/new-round-sanctions-announced-targeting-russian-oligarchs

5 April 2022 – Parliament completed the first reading of the Fair Pay Agreements Bill, referred to the Education and Workforce Select Committee with report back due by 5 Oct 2022.

https://www.parliament.nz/en/pb/bills-and-laws/bills-proposed-laws/document/BILL_121328/fair-pay-agreements-bill

https://www.beehive.govt.nz/release/everyday-workers-take-centre-stage-fpas-bill-passes-first-reading

6 April 2022 – IRD advised that a new FATCA Excel file template is now available for download via myIR.

6 April 2022 – Commission for Financial Capability released data about KiwiSaver balances across age groups and gender, with the data collected by Melville Jessup Weaver actuaries on behalf of the Commission. https://retirement.govt.nz/news/latest-news/new-data-reveals-for-the-first-time-largest-breakdown-of-kiwisaver-balances-across-all-ages-and-genders/

6 April 2022 – Privacy Commissioner invited submissions on a proposal to amend the Health Information Privacy Code 2020 to align it to the Pae Ora (Healthy Futures) Bill, with submissions closing on 4 May 2022. https://privacy.org.nz/publications/statements-media-releases/submissions-invited-on-proposal-to-amend-the-health-information-privacy-code-2020-to-align-it-to-the-pae-ora-healthy-futures-bill/


Legal and regulatory update for the life and health insurance sector

25 March 2022 – Commission for Financial Capability announced that Sorted in Schools had launched a new learning taxation module in partnership with the Inland Revenue. https://retirement.govt.nz/news/latest-news/building-financial-capacity-for-students-understanding-tax/

25 March 2022 – Financial Services Council released a Financial Advice Law Guide 2022 for Financial Advisers. https://blog.fsc.org.nz/financial-advice-law-guide?hsLang=en


Legal and regulatory update for the life and health insurance sector

16 March 2022 – The Commission for Financial Capability released commentary titled, “A deep dive into Pacific People’s financial capability.” https://retirement.govt.nz/news/latest-news/better-understanding-how-to-build-pacific-peoples-financial-capability/

17 March 2022 – FMA update released, including the following:

  • Speech by Samantha Barrass, FMA Chief Executive, to Financial Services Council Connect

https://www.fma.govt.nz/news-and-resources/speeches-and-presentations/speech-by-samantha-barrass-fsc-connect

  • ‘No action’ relief as a result of COVID-19

https://www.fma.govt.nz/news-and-resources/covid-19/no-action-relief-as-a-result-of-covid-19

  • a project to review five existing class exemptions due to expire this year, with consultations on the last two also released today, with submissions closing on 11 April 2022:
    • Multiple-participant Schemes - Participation Agreements exemption notice 2017, expires 22.10.22
    • Disclosure Using Overseas GAAP exemption notice 2021, expires 3.11.22
    • Financial Statements for Schemes Consisting Only of Separate Funds exemption notice 2017, expires 17.12.22
    • Irrigation Companies exemption notice 2018, expires 31.12.22
    • Small Co-operatives exemption notice 2021, expires 31.12.22

https://www.fma.govt.nz/compliance/consultation/consultation-small-co-operatives-and-irrigation-companies-class-exemptions

17 March 2022 – MBIE advised of the release of a range of documents relevant to the legislative proposals relating to the Conduct of Financial institutions (CoFI). The documents are available on the MBIE dedicated CoFI webpage. https://www.mbie.govt.nz/business-and-employment/business/financial-markets-regulation/conduct-of-financial-institutions-review/


Legal and regulatory update for the life and health insurance sector

7 March 2022 – Commission for Financial Capability released commentary in relation to International Women’s Day titled, “Mind the gender financial capability gap.” https://retirement.govt.nz/news/latest-news/international-womens-day-mind-the-gender-financial-capability-gap/

7 March 2022 - NZ Police Financial Intelligence Unit released its December 2021 – January 2022 Suspicious Activity Report. https://www.police.govt.nz/advice-services/businesses-and-organisations/nz-financial-intelligence-unit-fiu/fiu-reports


Legal and regulatory review for the life and health insurance sector

3 March 2022 – APRA released life insurance statistics for December 2021. https://www.apra.gov.au/news-and-publications/apra-releases-life-insurance-statistics-for-december-2021

3 March 2022 – The Commission for Financial Capability announced a new programme helping 1200 Pacific households on their journey to home ownership. https://retirement.govt.nz/news/latest-news/new-pathways-for-pacific-home-ownership/

3 March 2022 – The Council of Financial Regulators posted online details of its meeting held on 1 March 2022, together with advice of release of an updated Regulatory Initiatives Calendar. https://www.cofr.govt.nz/

4 March 2022 – Financial Services Council launched its 2022 Financial Resilience Index. https://blog.fsc.org.nz/2022-research-financial-resilience-index

3 March 2022 - The Reserve Bank of New Zealand said  its latest survey underscores the need for deliberate changes to the cash system to keep it resilient and efficient while needed and wanted by New Zealanders. https://www.rbnz.govt.nz/news/2022/03/cash-system-redesign-essential-to-support-changing-usage

3 March 2022 - Taxation (Annual Rates for 2021-22, GST, and Remedial Matters) Bill reported back to Parliament from the Select Committee. https://www.parliament.nz/en/pb/bills-and-laws/bills-proposed-laws/document/BILL_115767/taxation-annual-rates-for-2021-22-gst-and-remedial-matters


Legal and regulatory review for the life and health insurance sector

24 Feb 2022 –The Ministry of Business, Innovation and Employment (MBIE) sought feedback on the draft Insurance Contracts Bill that will make changes to improve insurance contract law, with submissions closing on 4 May 2022. https://www.mbie.govt.nz/have-your-say/consultation-on-exposure-draft-insurance-contracts-bill/

24 Feb 2022 – IRD sought feedback on its draft long-term insights briefing, “Tax, foreign investment and productivity” with submissions closing on 14 April 2022. https://taxpolicy.ird.govt.nz/news/2022/2022-02-24-draft-ltib-consultation

24 Feb 2022 – Commission for Financial Capability announced an awareness campaign aimed at inspiring young people to learn about money as part of Global Money Week, 21 – 27 March. https://retirement.govt.nz/news/latest-news/global-push-to-get-young-people-thinking-about-money/