Legal and regulatory update for the life and health insurance sector

17 May 2022 – Second reading of the Data and Statistics Bill completed in Parliament.

18 May 2022 – FMA released a report titled “Value for Money Industry Report” highlighting that Fund managers’ inconsistent performance measurement and cost of fees reduces benefits to investors.

Quotemonster update and more daily news

Quotemonster has gone through a major upgrade over the weekend, including the following changes:

  • Big improvements to Advicemonster: much more document layout and content control to make your SOA more yours than ever before
  • Ease of use improvements: new menu structure so it is easier to find what you want (including more than 900 old policy documents, plus funeral plan research and more)
  • Clearer to read text and layout: making it easier to view the research
  • Simpler back-end billing processes: if you subscribe you should notice very quick response on the credit card billing and invoicing process

The upgrade has taken some time, of course. We continually monitor the site and check for issues with the newly installed features, but if you think something is not right and want to bring it to our attention, please let us know using the help function on the site, email, or call. If you need something urgently and just want it now you can always click the button to go back to the old site as an interim measure.

Try out the new Quotemonster site at your usual link.

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How far the world has come and more daily news

From Our World in Data, it is encouraging to reflect of great strides defeating one disease as we try to get out from under the effects of the COVID-19 pandemic:

This is how far the world has come in the fight against polio.

In the 1980s more than 300,000 children were paralyzed by polio every year.

Thanks to the polio vaccine we now have the chance to *eradicate* polio globally in our lifetimes.

Link to more data on the fight against Polio here.

Back in New Zealand the battle continues, however, with about one third more people away from work with sickness compared to a year ago.


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Legal and regulatory update for the life and health insurance sector

28 April 2022 – IRD issued a special report on FDR foreign currency hedges with changes arising from the Taxation (Annual Rates for 2021–22, GST, and Remedial Matters) Act 2022 enacted on 30 March 2022.

28 April 2022 – FMA published under FMA Stories a Q&A session with FMA’s Tammy Peyper talking about investing and what to do when markets get rocky.

28 April 2022 – RBNZ Deputy Governor and General Manager Financial Stability delivered a speech on New Zealand’s Experience with Macroprudential Policy.

29 April 2022 – RBNZ media release noting strong public interest in the Future of Money following recent RBNZ consultations on the topic.

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)

Conduct and brand

Recently, working through conduct requirements, I was struck by the similarity between the guidance on conduct given by the FMA and the brand advice offered by marketing guru Seth Godin. So often, in the past, we have heard of good compliant processes referred to as best practice. To judge by many 'band-aid' compliance processes which add another form rather than renovate the whole process, the 'best practice' part is usually something of an aspiration. However, in this case, the process for good conduct and the process to achieve a great brand are very closely aligned. The FMA document is lengthy, whereas the Seth Godin post is short, so I should point out the similarity I found is present throughout the FMA document where it talks about director's obligations around product and pricing, but best shown in the three dot points listed under 'what we want to achieve' at the bottom of page four.

Consumer magazine on mental health underwriting and more daily news

In April, Consumer Magazine published an article on the underwriting of mental health conditions. My thoughts on the article are below:

Positives: the article is a good vehicle for the complaints levelled against the insurers, relying mainly on the Beyond Blue report from Australia and some good personal stories from applicants.

Problems: while calling for fairness, it fails to explore in detail how underwriting is done, what is meant by unfairness, or the complex issue of fairness to other policy holders and the effect on them. There is no exploration of the economics of underwriting or how the proposed changes would affect the market. There are serious issues to consider in the underwriting of mental health problems, as there are with many others. One the one hand questions are criticised for not being personalised enough, on the other hand they are criticised for being too ‘invasive’. There does not appear to be a clear idea of what good looks like.

As a publication meant to enable consumers to make better choices about products and services to acquire, I was left wondering, as a consumer, what this article was suggesting - it seemed not to guide consumers either towards or even away from any specific product but could easily put off applications from people with mental health problems, when in fact a lot of cover is available for them, and a lot of good work is done in underwriting to enable insurance to work for the whole risk pool.


More daily news:

  • Financial Advice New Zealand is running a licensing workshop with the FMA on the 27th
  • The FMA is also running a licensing event supported by Partners Life and Fidelity Life on the 5th of May - details here.
  • FANZ also has the details of a member survey on adviser attitudes towards the government proposed income insurance scheme - 23% support the idea, while many are undecided or would prefer a scheme in partnership with industry (more like KiwiSaver).


Southern Cross update and more daily news

Southern Cross Healthcare appoints Chris White into permanent CEO role. In the same week Southern Cross Health Insurance is promoting the value of vaccination against inflenza – offering a free ‘flu vaccine to members, announced Nick Astwick.

Southern Cross Healthcare has announced that interim CEO Chris White will take up the role permanently, effective immediately. 

Since taking on the role of Interim CEO, Chris has led the Healthcare team through one of its most challenging and unprecedented periods in the organisation’s history.

On his appointment, Mr White said, “Despite the challenges Covid-19 has presented within health, it’s an incredibly exciting sector with huge opportunities to deliver quality outcomes to New Zealanders. Southern Cross Healthcare is a dynamic business filled with fantastic people who are passionate about delivering high quality healthcare experiences and it is a privilege to be in a position to lead our journey from a hospital-centric organisation to a healthcare organisation.”

Chris began with the Southern Cross family as a CEO on the Insurance side of the business in 2017. From there, he moved across to Southern Cross Healthcare as Chief Operating Officer, and then to his current role as Interim CEO in October 2021.


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Southern Cross has also announced a new online procedure checking tool

The FMA is hiring:

Donate to long-covid research:

Legal and regulatory update for the life and health insurance sector

5 April 2022 – FMA released a speech presented by Clare Bolingford FMA Director of Banking and Insurance, to the FSC's: "Outlook for the insurance sector - Building a sustainable and trusted life and health insurance sector" webinar, during which she announced FMA plans to facilitate forums, starting next month, to get both providers and intermediaries in the same room to arrive at an industry led solution to how fair customer outcomes can be achieved within the bounds of commercial realities under the Conduct of Financial Institutions (COFI) regulation.

6 April 2022 – The Privacy Commissioner released a copy of the Commission’s submission to the Governance and Administration Parliamentary Select Committee on the Data and Statistics Bill.

6 April 2022 – MBIE sought feedback on feedback on 2 exposure drafts, one on the Credit Contracts and Consumer Finance Amendment Regulations 2020 (the Regulations) and another on Chapter 5 of the Responsible Lending Code (the Code), with submissions closing on 20 April 2022.