Southern Cross experience a surplus, and more daily news

Southern Cross has reported a surplus of $32.4 million for the year ended 30 June 2020. This financial reporting comes after the $50 million return to members. $972 million was returned in claims in the last financial year, this equals to 85 cents in claims being returned for every dollar received in premiums.

“Southern Cross Health Society Group has today released its annual financial results, posting a surplus of $32.4 million for the year ended 30 June 2020.

The announcement follows Southern Cross Health Society’s pledge during the Level Four lockdown in April to return $50 million to its members.

In the last financial year, the Society returned $972 million in claims and received $1.138 billion in premiums.

For each dollar received in premiums, it returned 85 cents in claims to members, compared with an average of 62 cents in the dollar among other New Zealand health insurers.”

“The business paid out 72 per cent of all private health insurance claims, significantly more than its 62 per cent market share based on Health Funds Association of New Zealand data.

Nick Astwick said that Southern Cross was focused on members during the last financial year. This included pledging to return $50 million, setting up employees to effectively working from home and ensuring the business digitisation process is on track.

Chief Executive Nick Astwick said the Society’s focus during the last financial year was on taking care of its members: “We were with our members from the start of the pandemic, returning $50 million to them, and introducing a significant range of options for those in need of hardship relief.

“At the same time, our workforce was very quickly set up to work remotely, ensuring service levels were seamlessly maintained.”

Astwick said cost-saving digitisation of the business had continued at pace, with 82 per cent of customer channels now fully digitised, and more than 96 per cent of claims submitted digitally.” Click here to read more

In other news

Southern Cross: Woman who lives in fear of jaw dislocation determined to get replacement

Southern Cross: Southern Cross gives support to students' mental health programme

AIA: Depressed man wins $173,000 battle with insurer AIA - there will be more discussion of media claims coverage in the forthcoming quarterly life and health sector report. 


 Development of Clearhead Te Reo platform

nib has announced that a Te Reo Māori platform has been launched in partnership with Clearhead and nib foundation. The Clearhead website and chatbot have been translated into Te Reo Māori to offer Maori communities the opportunity to better use the service as it has been found that Māori are twice as likely to experience mental health issues than people who aren’t Māori. This launch makes the service the first mental health service to support an indigenous language.

“Clearhead, a Kiwi digital mental health company has today launched its translated te reo Māori website and chatbot offering in partnership with nib New Zealand (nib) and nib foundation, designed to help reduce the barriers Māori communities often face when accessing mental health services.

Māori populations are consistently over-represented in New Zealand’s suicide statistics, are twice as likely to experience mental health issues compared to non-Māori, and 1.5 times as likely to report experiencing anxiety or depression.

As a global first for any digital mental health service to support an indigenous language, the translation marks an important step towards providing culturally inclusive resources to support the health and wellbeing of one of our most vulnerable communities.” 

Dr Angela Lim, Clearhead CEO, has said that mental health resources available don’t accommodate how Maori wish to access resources and support. Lim continues by saying that digital solutions that offer anonymity, flexibility, and affordability must be offered to improve outcomes for Māori. The launch of the new platform during Māori Language Week is intended to highlight the importance role culture plays on mental wellbeing.

“Clearhead CEO, Dr Angela Lim says that while Māori are disproportionately represented in the public mental health system, the resources available do not necessarily take a user-centric approach of how Maori would prefer to access these resources and support.

“Māori make up 40 percent of patients in the public mental health system, yet only around three percent of clinical staff in the sector identify as Māori, and an even smaller number are fluent in te reo Māori. To some, te reo is a fundamental part of their identity – and yet we face significant challenges in delivering culturally appropriate services to this community,” Dr.Lim said.

“In order to improve mental health outcomes for Māori, utilising digital solutions where we can provide anonymity, flexibility, affordability and overcome geographical barriers can be a viable solution. We hope our platform can assist in improving reach and engagement for Māori seeking mental health support and provide that safe place where they feel heard,” Dr Lim added.

With the new platform launching during Te Wiki o Te Reo Māori (Māori Language Week) Clearhead’s aim is to highlight the importance culture has on one’s mental health and wellbeing. Research from the Mental Health Foundation has demonstrated that a strong cultural identity – including a connection with Māoritanga and te reo within Māori communities – is linked to positive wellbeing and a reduced risk of suicide.” Click here to find out more

In other news

nib: leaders and employees took part in a 10-week Māori language training program designed by Ngāti Whātua Ōrākei

FMA: FMA details Covid-19 response

FSC: "Alarmingly excellent" results for Kiwis who seek financial advice


Asteron Life introduces mental health support, and more daily news

Asteron Life announced that the Best Doctors service will provide free access to different mental health experts to customers with disability insurance. The service will allow customers to access general advice as well as services from psychologists and psychiatrists. 

“Asteron Life today announced that customers with disability insurance will now have access to the Best Doctors service at no additional cost. The Best Doctors package provides direct access to a multidisciplinary team of mental health experts, including psychologists and psychiatrists, as well as general advice on mental health conditions and guidance on how to navigate the mental health system.”

Graham Hill, executive manager Life Distribution said that Best Doctors works to ensure customers are connected and make medical decisions with confidence. Graham continued by saying that having access to expert medical advice in the current environment is relevant while Mike Morris, the country manager of Best Doctors said that the importance of virtual care has been highlighted this year.

“Best Doctors connects our customers with leading medical specialists, and enables them to make medical decisions with confidence,” says Graham Hill, executive manager Life Distribution at Asteron Life. “Like insurance, the service is really about being there for people when it matters.”

 

Hill says that in the current Covid-19 environment, mental health support and the ability to get expert medical advice from your own home is particularly relevant.

 

Mike Morris, the country manager of Best Doctors has said “This year has shown us that virtual care is incredibly important and effective. There has never been a better time to offer people access to virtual care and we’re delighted to be bringing new services to Asteron Life customers.”” 

Asteron Life is offering advisers virtual training sessions. Times available are:

·       09:30am – 10:30am, September, Wednesday 9

·       09:30am – 10:30am, September, Thursday 10

·       09:30am – 10:30am, September, Monday 14

·       09:30am – 10:30am, September, Monday 21

·       09:30am – 10:30am, September, Monday 28

 

Click here to register

Click here to read more

 

In other news

RBNZ: Has the Reserve Bank responded differently to upturns and downturns in inflation and economic activity?

FMA: COVID-19 response insights

Financial Advice webinar: Panel Discussion: Obtaining or Updating your Level 5 Qualification in Financial Services

 


Deloitte report on the New Zealand life insurance sector

Deloitte's report on the New Zealand life insurance sector provides a comprehensive overview of the structural differences between the New Zealand environment and the markets with which it is often compared. It provides context for the comparisons that are inevitably made as part of the debate over issues such as efficiency, commission payments, claims ratios, and channel mix. Rather than give quantitative answers to challenges - such as concerns about the level of commissions - it seeks first to explain the situation. Some assertions are made, usually about the possible causes of some features of the market, but refreshingly, without advocating for any particular prescription. Except for one: the report suggests caution. I think that is wise. Dramatic changes have been made to the Australian life insurance sector. It appears to be much the worse for them. In a sector where contracts are commitments for decades of cover, often with fixed terms, and sometimes with fixed premiums, it seems wise to exercise caution. Anyone writing a background paper for a strategy session would do well to set this as background reading or use the issues as a checklist for their decision-screens. What solutions you may bring to each of the issues, that will be up to you. Link: https://www2.deloitte.com/nz/en/pages/financial-services/articles/deloitte-issues-paper-life-insurance-sector.html#  


Legal and regulatory update for the life and health insurance sector

4 Sept 2020 – The FMA released a consultation paper on the proposed Auditor Regulation Act (Prescribed Minimum Standards and Conditions for Licensed Auditors and Registered Audit Firms) Notice 2020, intended to replace two previous notices proposed to be revoked. Submissions close on 21 Sept 2020. https://www.fma.govt.nz/compliance/consultation/consultation-prescribed-min-standards-conditions-licensed-auditors-registered-audit-firms/

2 Sept 2020 – FMA issued a warning that it is aware of a case where scammers have been impersonating the FMA while operating a scam relating to money remittance services. https://www.fma.govt.nz/news-and-resources/warnings-and-alerts/fma-impersonated-in-suspected-money-remittance-scam/

3 Sept 2020 – Deloitte issued a paper commissioned by Partners Life exploring observations made in the RBNZ Bulletin, which provided commentary around the profitability of New Zealand’s life insurers, the value for money of life insurance, and life insurers’ ability to meet minimum capital requirements.

https://www2.deloitte.com/nz/en/pages/financial-services/articles/deloitte-issues-paper-life-insurance-sector.html#

3 Sept 2020 – The Commerce Commission announced that it has signed a multilateral framework enhancing international cooperation on competition enforcement with the Australian Competition and Consumer Commission, the Competition Bureau of the Government of Canada, the United Kingdom Competition and Markets Authority, the United States Department of Justice and the United States Federal Trade Commission.

https://comcom.govt.nz/news-and-media/media-releases/2020/commerce-commission-signs-multilateral-framework-enhancing-international-cooperation-on-competition-enforcement

3 Sept 2020 – FMA update released which included the following new material:

  • The release of three short videos for consumers about getting financial advice featuring Investor Capability Manager Gillian Boyes together with a related Spinoff article. Related weblinks at
  • World Investor Week 2020, starting Monday, 5 October.

Related weblinks at https://www.fma.govt.nz/investors/getting-financial-advice/ and https://thespinoff.co.nz/money/12-08-2020/everything-youve-always-wanted-to-know-about-financial-advisers/


Legal and regulatory update for the life and health insurance sector

27 Aug 2020 – MBIE issued a reminder that the “Covid-19” safe harbour for company directors from their insolvency related duties will expire on 30 Sept 2020 as planned.

28 Aug 2020 – Minister of Commerce and Consumer Affairs, Hon Faafoi, diary for July 2020 released, with the following potential financial services sector related meetings noted:

  • 1 July 2020 - Meeting with Christians Against Poverty (Aimee Mai and Michael Ward)
  • 1 July 2020 – Meeting with Vero (Marie Hosking, Adrian Tulloch and Helen McNeil)
  • 2 July 2020 – Meeting with AIG (Toni Ferrier and Bhairav Shah)
  • 22 July 2020 – Phone call with FMA (Mark Todd)
  • 30 July 2020 - Meeting with FSC (Richard Klipin and Rob Flannagan)
  • 30 July 2020 - Meeting with ‘Buy Now, Pay Later’ providers (Shaun Quincey, Neil Simons, Michael Saadat, John O'Sullivan, Julian Grennell)
  • 31 July 2020 – Meeting with Insurance Brokers Association of New Zealand (Melanie Gorham, Tony Bridgman and Barry Hellberg)

28 Aug 2020 – Good Returns reported that on 27 Aug 2020 MBIE released submissions made on the exposure draft of the disclosure regulations applicable to Regulated Financial Advice.


Legal and regulatory news update for the life and health insurance sector

27 Aug 2020 – FMA announced the appointment of Paul Gregory to the newly created role of Director of Investment Management.

https://www.fma.govt.nz/news-and-resources/media-releases/fma-appoints-new-director-of-investment-management/

27 Aug 2020 - RBNZ have issued advice to the financial services sector from the National Cyber Security Centre regarding recent cyber attacks that appear to be aimed at the financial services sector. The most high profile example has been the NZX experience. However, other companies may expect to be attacked.


Suicide rates: coroner's report and international comparison

In short: lockdown is not causing an increase in suicide rates - in fact deaths from all causes are down - but we do have a problem. 

The coroner recently released their report on suicide rates for the past year. The media release can be found at this link: https://coronialservices.justice.govt.nz/assets/Documents/Publications/Chief-Coroner-Suicide-Stats-2020-Media-Release.pdf,  the full report at this one: https://coronialservices.justice.govt.nz/assets/Documents/Publications/2020-Annual-Provisional-Suicide-Statistics.pdf

I commend to you the full report. In spite of the current years' figures being a decrease on the prior year, the trend-line remains upwards over several years. Ethnic breakdowns of the rates are worth reviewing. Maori rates of suicide are highest, but this is followed by European rates, then Asian, then Pacific people. Male rates of suicide are 2.5 to 3 times the rates for females. 

To provide context, the chart below (with thanks to Ourworldindata.org) shows the rate per 100,000 of population, from 2000 to 2016, with some selected countries and groups of countries for comparison. It is the comparison with the UK that strikes me in particular. The chart is interactive. Feel free to change countries and explore. 


Partners Life update waiting period restriction on QFA, and more daily news

Partners Life has announced that the waiting period restrictions for self-employed customers have been lifted from QFA. The revision to waiting periods was applied to Quote and MUM immediately after the announcement in July. The update to QFA means that advisers can quote all wait period options for their existing clients’ Income Cover, Mortgage Repayment Cover and Household Expenses Cover.

 

“In late July this year we announced a revision to our restrictions on waiting periods for self-employed customers, allowing you to quote all waiting periods on Income Cover (Indemnity Loss of Earnings), Mortgage Repayment Cover and Household Expenses Cover.

 

“The system changes were applied immediately to Quote and MUM allowing you to quote and apply for cover for new clients. The system updates to Quote for Alteration (QFA) required additional time to implement and we advised short-term workarounds to quote on waiting period changes for your existing clients.

Today we are happy to confirm that restrictions on waiting periods for self-employed customers have now been removed from QFA.

Effective immediately you can now quote all wait period options for your existing clients’ Income Cover (Indemnity Loss of Earnings), Mortgage Repayment Cover and Household Expenses Cover.

In other news:

Fidelity Life: MedScreen is currently not operating in Auckland, MedScreen paramedical visits are still happening in other regions

Fidelity Life: it is recommend that all new business is submitted via e-App

Women in Insurance New Zealand goes virtual

FSC: Get In Shape Session 7: Using Technology to make your business more effective

 


Financial adviser network raises capital and more trends in digital for advisers

The XY Adviser network (https://www.xyadviser.com/) is a popular place for financial advisers to trade news, talk about events, and get help and support. I know several New Zealand-based advisers that love the forum and have learned many useful new ideas from their peers through it. Other groupings, collegiate groups ranging from informal breakfast clubs, through service networks, to LinkedIn groups abound. But the shift to digital broadens the reach of networks considerably. Network effects mean that the bigger the network, the more valuable it is. Hence, the profound impact digital is having on adviser businesses. Two trends are moving in parallel - from installed software to web-based systems, alongside formal knowledge sharing in person to digital knowledge sharing in an informal context. Those changes in digital are having real-world effects: adviser businesses are able to access software solutions from around the world with more confidence due to the reference expertise that these social networks provide. One kind of growth creates another: XY is in the process of raising capital, such are the demands on their services. 

If the world of adviser technology interests you, do join me, with David Greenslade of Strategi on the FSC Get In Shape series hosted by Mark Banicevich. We're talking about all things adviser technology tomorrow at 10am. Here is a link to the events page on the FSC website: https://www.fsc.org.nz/Events.html if you would like to register for the webinar.