Quality Product Research: (Inbuilt) Child Trauma – Part Two 

A reader has queried whether QPR takes the sum insured into account in our Research Ratings.  And the answer is yes, we do consider the amount paid by each insurer. In fact amount paid are a vital part of a value-based assessment approach - and something we capture much better than simple feature lists of benefits do. 

In trauma insurance, some companies pay the full benefit for an item, others only make a payment of 10% or 20% of the sum insured because the condition was not severe enough to warrant a full payment. Our score is varied according to how much would actually be paid. In the scenario for Child Trauma, we have a claims amount of $100,000 and calculate how much would be paid out by each insurer.  

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Furthermore, based on adviser feedback we have corrected our ratings to reflect the fact that Asteron does include the option to convert their child cover to adult trauma at age 21. Interestingly, if the parent is on Trauma Recovery (TR) and considering converting their child cover to TR with Early Trauma they are required to complete an application. 

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Your feedback

We value getting your feedback on how these wordings are being applied to claims you may be aware of. Please email us with details of any recent claims to help us update our understanding. 

Doreen Dutt, Research Analyst, Quality Product Research Limited, researcher@qpresearch.co.nz


Quality Product Research: Proposed rating for Benign Brain and Spine Tumour

Introduction

The World Health Organisation states that 130 different types of brain tumours exist. A benign brain tumour is a non-cancerous growth in a distinct area of the brain. The survival rates for patients with benign brain tumours are higher than others, however this depends on the size and location of the tumour within the brain.

Proposed sub-items

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Notes

There are some noticeable differences between insurers such as whether partials exist, or if the spinal cord or tumour on the pituitary gland is covered. We have tried to make the sub-items clearly demonstrate the variation between insurers.

Why is this important?

Although QPRs weighting of this item is low, it would be of high interest to those that have a family history of brain cancers. With a lot of insurers now having specialised cancer products we would like to ensure that our rating is relevant. 

Your feedback

We value getting your feedback on how these wordings are being applied to claims you may be aware of. Please email us with details of any recent claims to help us update our understanding.

Doreen Dutt, Research Analyst, Quality Product Research Limited, researcher@qpresearch.co.nz


Quality Product Research: Inflation Adjustment item update for Life Cover

Introduction

Inflation is often overlooked when customers are looking to purchase Life Cover. Although it may not be necessary for short term policies, it is however, a valued feature for long term policies (i.e., those that are in place for 20 years or more). 

Sub-items rating review

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Following up on adviser feedback, we have recently added the optional Inflation Adjustment feature to MAS increasing the accuracy of our rating for Life cover for this insurer.

Please note we currently only show the pricing difference between indexed vs non-indexed (as shown below) and the rating for optional items are excluded from the total rating you will see on your research report.

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Notes

The Inflation Adjustment benefit does not significantly vary among providers. Companies differ in expiry age, with Pinnacle being the only that expires at age 60. ANZ bank seems to be the only provider with a deduction for the sub-item “Excludes when premiums are waived”. A significant difference is whether the benefit is optional or included.    

Why is this important?

The benefit would be of high value for those looking to purchase long term policies. To not have this option would have a great impact in the future as you would understand that the cost of living will only increase as time goes on (and so should our Life cover). 

Your feedback

We value getting your feedback on how these wordings are being applied to claims you may be aware of. Please email us with details of any recent claims to help us update our understanding.

Doreen Dutt, Research Analyst, Quality Product Research Limited, researcher@qpresearch.co.nz


Daily news update: MAS weigh in on remote working, and other stories

In light of the past two months, Martin Stokes, MAS CEO, has said that the insurer is open to the idea of remote working. Stokes highlights the slow adoption of flexible work options in past years has been accelerated by the lockdown. MAS will use events during the lockdown to inform future working arrangements.

“Medical Assurance Society (MAS) chief executive Martin Stokes (pictured) says that the past six weeks have been a kind of mass social experiment, and, as a result, the workplace flexibility trends that were already emerging have been accelerated massively. He says the level of productivity in some areas has been surprisingly high in a remote environment, and, as a result, a much higher level of flexibility will become the norm.

“This situation has identified for us the opportunities that would otherwise likely have emerged over a much longer period of time,” Stokes told Insurance Business.

“Social trends would have influenced people’s thoughts around where they wanted to work, flexibility, different working arrangements, etc. But that’s really been concentrated into a six week-long social experiment where everybody’s had a taste of what that’s like enforced upon them.” Click here to read more

In other news:

Will corporates embrace remote working? - will this moment change everything, or will they slip back into old ways of working?

TAP: are offering to help advisers with claims

FMA: FMA urges public to pay attention to terms of insurance relief

Pepper Money: Pepper writes 600 NZ loans in first year


Latest Product Research

We have just distributed the latest product research database update (QPRV12_6). This version includes the following changes:

  • AIA - Changed Credit Rating and Agency
  • AMP - Changed Credit Rating
  • MAS - New policy wording for Life, TPD and Trauma
  • AMP Lifetrack - New policy wording changes
  • Fidelity - New policy wording - no rating changes
  • Add new Product Line Wellness to take AIA Vitality into account. This will appear on the Package score on QuoteMonster research if AIA Vitality is selected

 


Robo-advice vision: overlooking the insurance dimension

An article from NZ Herald explains that the concept of robo-advice is on the books for 2018. The FMA made an announcement after receiving 49 submissions with the majority of these in favour of robo-advice. Interesting to read the list of companies that the NZHerald note submitted on the law. This isn't the full list, just the ones the Herald picks out to mention, probably based on their familiarity with the brand names:

'The consultation period, which ran from June 21 to July 19, included submissions from: Cigna Life Insurance, Delta Insurance NZ, Fidelity Life Assurance, the Institute of Financial Advisers, the Insurance Council of NZ (ICNZ), Medical Assurance Society of NZ, Partners Life, Southern Cross Medical Society, as well as major retail banks ANZ, ASB, Westpac NZ, fintech start-ups and law firms.'

Look at that list again - seven of the organisations mentioned are insurers or insurance-focused. Yet this article exclusively covers the funds management sector, excluding insurance, probably because it is written by an investment-focused adviser. Readers should not make the same mistake - insurers in New Zealand are very interested in robo-advice. But moving past that, a number of useful points are made. One is about fee transparency - and the connection to improved requirements for the advice process under the draft new Financial Services Legislation Amendment Bill are important. Robo advice services should be subject to the same rules as human advice services, although specific regulatory requirements will differ, because the nature of engagement with the services, and how they are run differs.

Click here to read more.


The surgeon, the insurance company and the $50,000 bunion

Here is the story of a lady who had complications after bunion surgery and was claiming on her income protection benefit from MAS. After returning to work for over 40 hours per week Juhasz was no longer entitled to the benefit and has now lost a legal battle which states she must pay back the over payments of approximately $50,000.


HFANZ: Health Insurance Coverage Rises

HFANZ released figures yesterday confirming that the number of New Zealanders with private health insurance cover has continued to increase over the past year, along with the total value of claims paid.

The release read:

'Despite paying healthcare claims of over $1 billion in the year to the end of September, the industry says it could be playing a much larger role in funding New Zealand’s healthcare costs if the Government was more open to recognising its strategic value.

HFANZ chief executive Roger Styles said successive governments had largely ignored the potential contribution from private health financing, despite increasing public funding difficulties.

He said recent research by NZIER suggested that health insurance could be funding up to $2-3 billion per annum in healthcare costs if New Zealand could match the levels of countries with similar health systems who harnessed private funding better.

 

“Given the current and forecast state of public health funding, it would seem obvious that some strategic thought should go into growing alternative health funding sources. Looking to develop more robust private funding of healthcare can only help relieve public funding pressures and improve overall health outcomes,” Mr Styles said.

He said he believed the Government’s draft health strategy, released last week, needed to give more prominence to growing private health funding to help counter the looming public funding shortfalls.

“If we had a more strategic approach to health financing, then we’d already be looking at the type of initiatives in the Affordable Healthcare Bill – a NZ First member’s bill currently before Parliament – such as getting rid of fringe benefit tax on employer-funded health insurance for their staff,” he said.

HFANZ statistics for the September quarter showed an increase of 3400 lives covered, bringing the total number of New Zealanders with health insurance to 1.337 million. On an annual basis, lives covered increased by 4600, or 0.3 percent, for the year ending September 2015.

Total claims paid amounted to $1.023 billion for the year ending September 30, 2015 – up 4.9 percent on the previous 12 months. Claims paid for the September quarter were $274 million, up 4.1 percent.'

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