Insurer switching levels have reached all-time highs among planners, highlighting the need for retention, according to Investment Trends.
The 2017 Planner Risk Report found 47 per cent of planners said they stopped using at least one insurer in the last 12 months, up from 45 per cent in 2016 and 35 per cent in 2015.
Senior analyst, King Loong Choi said insurers had to nurture relationships with planners and maintain high satisfaction levels if they were to decrease attrition rates.
“To strengthen planner relationships, insurers must demonstrate a value proposition that extends across the entire value chain,” Choi said.
“Insurers need to provide support from the back end, through seamless underwriting and online applications, all the way to the front end, by assisting planners with client engagement and education.”
In terms of the Life Insurance Framework (LIF), planners were already adapting to the reforms which come into effect in January 2018 by becoming less dependent on upfront commission and leaning towards hybrid commission models instead.
However, many were not in favour of the reforms, arguing the reforms would not benefit their practice, the financial planning industry, or consumers.
Choi said planners were in the midst of adapting to the new regulatory requirements while dealing with other challenges in providing life insurance advice including paperwork, administration and compliance.
“Right now, insurance and technology provider assistance is more vital than ever in helping planners expand their life insurance advice,” he said.
“This is evidenced by the 70 per cent of planners who seek additional support, most commonly in the form of improved process efficiencies, more information on the reforms, and more adviser business support.”