Asteron launches new adviser remuneration model
Asteron Life has launched a new remuneration structure for advisers, which aims to create a "sustainable financial model" while improving the speed of clients' insurance applications.
Called ‘2 for 10', the new structure will offer an extra 10 per cent commission in year one to advisers who write new business for Asteron Life's Complete suite of products using the e-application process, or selecting the hybrid or stepped hyprid commission structure.
If advisers choose an upfront or level commission structure instead, they will not be eligible for the ‘2 for 10' offer, according to Asteron Life executive general manager, Jordan Hawke.
"Hybrid or stepped hybrid structure might earn the adviser less commission in year one compared to up-front structures, but provides a transition solution to increase the long-term value of their business," Hawke said.
Hawke added the company observed more than 80 per cent of business was written in upfront commissions.
"This is good for cash flow but not for building advisers' business value," he said.
While ‘2 for 10' may be seen as a short-term tactical solution, it responds to the challenges faced by many advisers, Hawke said.
"We all recognise that consumers who receive advice from an adviser have better financial outcomes, and it is important that advisers get paid for this advice. ‘2 for 10' is designed to support advisers that want to get efficiency in their business through e-apps, and shift to an alternative remuneration model."
Hawke has long been vocal on issues affecting the life insurance industry, including product structures, cost of acquisition and retention.
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