Pandemic challenges planners to reassess delivery of risk advice: 2020 Planner Risk Report

King Loong Choi

Investment Trends has released its 2020 Planner Risk Report, an in-depth survey of Australian financial planners who provide advice on life insurance.

The pandemic has challenged financial planners to reassess their delivery of risk advice

The latest research from Investment Trends reveals that the majority of financial planners (80%) made changes to their delivery of risk advice in response to disruptions from the COVID-19 pandemic.

Amidst the pandemic, planners most often say they engaged with their clients more frequently (30% cite this), scrutinised premium levels (23%) and quality of service (23%) when selecting insurers, and accelerated their adoption of technology in their risk advice process (22%).

“Financial planners are reevaluating all aspects of their delivery of risk advice – from their insurer relationships and technology stack, to the way they communicate and demonstrate value to clients,” said King Loong Choi, Associate Research Director at Investment Trends.

“As planners help their clients navigate the pandemic, support from their insurers and technology partners will be crucial to lifting the quality of their risk advice,” said Choi.

Insurers who delivered proactive BDM support and streamlined online processes were more highly regarded

In 2020, the top challenge faced by planners in providing risk advice were rising premiums (61% cite this), ahead of compliance obligations (53%) and paperwork/admin requirements (50%). Against this backdrop, the insurers that stood out were those that effectively helped planners alleviate these issues.

“When asked to describe in their own words how insurers helped them navigate COVID-19, planners most often acknowledged premium relief for impacted clients, proactive BDM contact and streamlined online processes,” said Choi.

“Competitive premiums matter for planners and their clients in their choice of insurer, but it isn’t the sole factor. Planners highly value proactive support, meaning that insurers that provide quality BDM support, ongoing communications and quick turnaround times will stand out.”

NEOS ClearView leads satisfaction rankings for the third consecutive year

Investment Trends measured planner satisfaction with their main life insurer across 31 key service areas, including their overall satisfaction. Industry wide overall satisfaction fell significantly amidst the pandemic, with only a quarter of financial planners rating their main insurer as ‘very good’ compared to 57% in 2019.

At the provider level, NEOS has marginally overtaken ClearView for top spot in overall satisfaction in 2020, with 56% of primary users rating it as ‘very good’ compared to 54% for ClearView. The top three life insurers by overall planner satisfaction are:

1. NEOS
2. ClearView
3. Zurich

About the report

The Investment Trends 2020 Planner Risk Report examines Australian financial planners’ advice on life insurance, including their use of investment platforms and planning software when providing advice on insurance. The results are based on an in-depth survey of 524 financial planners concluded in October 2020.