Risk advice still a growth area for planners
Financial planners are sourcing almost a third of their revenue from risk advice and as such, showing little hesitation when it comes to switching insurers for the best deal, a report shows.
While the vast majority of planners (90 per cent) continue to advise on risk, the share of revenue risk advice offers planners continues to grow and is now at 29 per cent, up from 27 per cent last year, according to the Investment Trends June 2014 Planner Risk Report.
Planners say they expect it to hit 31 per cent by 2017.
And while the last few years have seen planners consolidate the number of insurers they use, the last 12 months has seen them once again broaden their range, with the average planner now using 3.7 insurers, compared to 3.4 a year earlier.
Insurer switching has also reached 40 per cent, up from 35 per cent the previous year, according to the report.
"Insurer relationships are in a state of flux," Investment Trends senior analyst Recep Peker said.
"Planners are aggressively expanding the number of insurers they use, while cutting those who aren't exceptional. There are great opportunities and risks for insurers to either benefit or lose out from this switching."
Underwriting remained a key differential between insurers, with planners citing it as the key driver of overall satisfaction.
"Underwriting is very important for both acquisition and retention, and will be a key battleground for insurance providers over the next year," Peker said.
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