Tim Bailey

Zurich has secured a group insurance mandate from a Queensland based industry superannuation fund.

The mandate, Zurich’s first since it acquired OnePath Life in June this year, was awarded by Energy Super, an industry super fund which manages $8b in assets on behalf of 47,000 members.

Commenting on the announcement, Gerard Kerr, Head of OnePath Proposition and Group Insurance, said it underlined the commitment of Zurich to the Group market, and the strength of its proposition as a local expert within a specialist global insurance group.

“Our strength in partnerships was recognised by Energy Super, in particular our approach to working alongside them to drive greater sustainability, efficiency and member engagement,” said Kerr.

“Our award winning claims service was also singled out as a factor in winning the mandate, in particular our innovative rehabilitation and wellness offering and our ability to develop deep insights from claims trends using Artificial Intelligence (AI) based models”.

Energy Super Chief Executive Officer Robyn Petrou said the profit-to-member fund continues to focus on innovation and partnerships of shared value as the fund expands its member base.

“We always put our Members first, adapting and growing our products and services to meet their changing financial needs,” Ms Petrou said.

“We are the fund of choice for the energy industry, so our insurance offering has to be affordable, comprehensive and responsive to meet the needs of people who work in higher-risk occupations.”

“While we are Energy sector specialists, our consistently low fees and high returns attract members from all industries, from right across Australia. This means our insurance products need to be flexible enough to cater to workers in lower-risk occupations.”

Tim Bailey, CEO Zurich Life and Investments said Zurich was now a large, multi-channel insurer and believed it had the opportunity to become a leader in the group sector.

“Zurich is a major player in group cover at a global level, and we are investing extensively in this channel in Australia.

“So far the market response has been very positive, and we believe the strength of our local team and offering represents a strong platform from which to grow significantly and sustainably,” said Bailey.

Zurich went on risk for Income Protection policies from 5th September this year, with the Group Life policies to follow some time before 30 June 2020.

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Delaney, who will take up his appointment in December 2019, brings to the role almost 25 years of experience in the Australian financial services industry. He was most recently the Chief Operating Officer for TAL’s life insurance business.

Prior to that, Mr Delaney held senior roles for over 12 years with the Macquarie Group, where he oversaw the creation and growth of Macquarie Life, as well as leading their platforms, superannuation and online broking businesses.

Delaney succeeds Tim Bailey, who is returning to Europe to take up another role within the Zurich Group.

Since joining the Australian business from Zurich’s Group Head Office in early 2015, Bailey has overseen the successful acquisition and integration of the Macquarie Life business, and most recently the successful completion of Zurich’s acquisition of OnePath Life.

In announcing the leadership changes, Mr Jack Howell, Zurich’s APAC Regional CEO, said that Mr Delaney will join a strong, growing business that was now a true leader in the Australian life insurance sector.

“Our Australian life insurance operations are now our largest regional revenue contributor and underpin our growth aspirations throughout Asia Pacific.

“Justin brings excellent experience across all channels in the life sector, and joins a business with a clearly defined strategy, built on a commitment to a dual brand, multi-proposition approach in retail, and strong growth aspirations across group life, bancassurance and investments.

“This strategy has been developed and executed by a stable and highly experience senior leadership team, and I know Justin is looking forward to working with them immensely.”

Howell also thanked outgoing CEO Tim Bailey for his role in growing the Australian business to a position of genuine strength.

“As CEO, Tim has successfully grown Zurich from a mid-tier player to a true market leader in Australia.

“One of the many drivers of this success has been Tim’s focus on organisational culture, and we are proud of the excellent employee engagement seen across the Australian Life and Investments business, which is amongst the highest in Zurich Group.

“Tim was able to articulate a clear strategic vision, and motivated and empowered his people to deliver it. The excellent results that the business continues to achieve are a real testament to this.”

Bailey will continue in his role as Australian Life and Investments CEO until late 2019 when Delaney takes up his appointment.

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Tim Bailey

The nature of work continues to evolve, with technology creating more opportunities for self employment and ‘gig work’, and movement between jobs, industries and locations becoming more commonplace.

However, this increase in flexibility has come at a cost, with workers prone to more gaps when it comes to job and income security. At the same time, mechanisms that have previously provided safety nets and financial protection have failed to evolve at the same rate, leaving employers, insurers and governments with significant challenges if they are to adapt to the new world.

A landmark global study by Zurich Insurance Group (Zurich) and the Smith School of Enterprise and Environment at the University of Oxford has identified the groups most vulnerable to this changing work environment, examining their concerns across a range of related topics, including the perceived impact of technology on their jobs, their financial anxieties, and their knowledge and understanding of insurance protections.

The headline findings of the research, conducted across 17,000 respondents in 15 economies including Australia, include the extent to which inadequate retirement savings is a global concern (even amongst millennials), and the vulnerability of women to the changing nature of work due to their (self reported) lower mobility and flexibility.

The Australian component of the research saw more than 1,000 working age Australians surveyed, and revealed some key differences from the global results:

• Australians are amongst the least concerned that they will lose their jobs to technology
• They are amongst the most likely to become a freelance or self-employed worker in the near future
• They are relatively better savers; and
• Australian blue collar workers are more likely to have life insurance protection in place.

Commenting on the release of the survey findings, Mr. Tim Bailey, CEO of Zurich’s Australian Life & Investments business, said that the findings showed financial conservatism is common even amongst younger age groups.

“People of all ages are clearly worried about how to maintain their living standards when they retire”, he said.

“Whether you are 20 or 50, getting your retirement savings right is paramount; Coming at a time when the way we work is rapidly changing, the study is a valuable contribution to the broader debate about jobs and financial security and the policies that can help us respond effectively”, said Bailey.

The results also provide a timely reminder of the role of life insurance in optimizing retirement savings, a point often lost during the ongoing discussions about group life and member best interests.

“The policy basis for life insurance being such an important part of the superannuation system is the role it plays in mitigating any interruption to a person’ income stream – and ability to save – because of illness or injury”, said Mr. Bailey.

“That basis is as relevant today as it was in 1992 when the superannuation system was created.”

Global findings

• Having too little saved for a comfortable retirement is the top financial worry. Across most countries and even age groups, almost half nominated this as their main concern, ahead of paying monthly bills;
• Women are more vulnerable to changes in the working environment. They were significantly less likely to supervise others, they were less positive about the impact of technology on their job and future prospects and they showed less willingness/ability to change jobs and locations. They were also less knowledgeable about insurance protection options;
• Millennials show strong financial conservatism. Around two thirds of them reported saving income. And around a third nominated retirement savings as their main financial concern (roughly the same as those nominating monthly bills as the priority);
• Job instability is as likely to be voluntary as involuntary. One fifth of respondents think they are likely to lose their job in the next year. An even greater proportion (27%) said they planned to leave their job voluntarily within the same period of time.

The study is part of a major three-year research program with Zurich and University of Oxford (launched in November 2018) exploring ways to ensure more workers are provided with flexible protection and financial support in an increasingly fragmented labour market.

Read the full report, including the Australian results.

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Tim Bailey

Zurich’s acquisition of ANZ’s life insurance business, OnePath Life, is now officially complete.

The completion of the sale sees Zurich acquire the OnePath brand and product range, along with more than 500 employees who have joined the Zurich Life and Investments team across Australia. It also marks the commencement of a 20 year agreement for the distribution of life insurance through ANZ’s bank channels.

As has been confirmed, Zurich intends to invest further in the OnePath brand and OneCare life insurance offering, and both the Zurich and OnePath brands and product sets will continue to compete with – and complement – each other in the open market.

CEO of Zurich Life & Investments, Mr Tim Bailey, said that this ‘multi proposition’ strategy would allow both customers and advisers to benefit from the breadth of choice offered by two specialist life insurance brands.

“We’re delighted to see the OnePath Life and Zurich teams come together to create one of Australia’s leading life insurers”, said Mr Bailey.

“Both Zurich and OnePath share a longstanding Australian heritage, with strong brands that are well supported by advisers and customers”.

Bailey sees continued investment in both the Zurich and OnePath offerings as crucial at a time when advisers are demanding more choice and more innovative ways to meet their clients’ protection needs.

As medical treatments improve and the working age extends, more and more Australians are living through serious health conditions, fundamentally changing their need for life cover. With advisers and clients are looking for new solutions to meet their needs, the standalone and complementary strengths of the Zurich and OnePath offerings are well placed to lead this evolution.

“Both Zurich and OnePath are known for their innovation and advisers can expect to see that continue with updated product and service offerings to be rolled out by both brands during 2019”, said Mr Bailey.

The acquisition also sees a new combined leadership team take effect, comprising senior members from the previous Zurich and ANZ/OnePath teams.

“We have been able to assemble a team of leaders who are amongst the most talented and respected in the industry, and I think the balance of the team sends a powerful signal about our intention and capability to execute our multi proposition strategy”, Mr Bailey said.

From a practical perspective, advisers and customers should expect to notice little, if any, change as a result of the acquisition, with the dedicated infrastructure of both businesses remaining in place.

“Advisers don’t want any further disruption, and with each brand continuing to be supported by dedicated teams, they will see no change in processes, relationships, or contact details“, said Mr Bailey.

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Tim Bailey

Zurich has called for all stakeholders – regulators, policymakers, financial advisers, insurers and consumers – to collaborate on the framework for the 2021 ASIC review of life insurance advice.

This collaboration is essential to ensure the review, which will determine the choices consumers have in accessing expert help with life insurance, is as robust and comprehensive as possible.

The call out comes as Zurich Life & Investments CEO Tim Bailey announced the release of new research quantifying the extent to which consumers are unwilling to pay out-of-pocket fees for life insurance advice.

“We’ve seen across a number of sectors and a number of countries that consumer willingness to pay out of pocket fees for life insurance advice is very limited, usually due to financial constraints, so in a way these findings simply reinforce what we expected to be true”, said Bailey.

“To the extent that demand for life insurance generally coincides with major life events, for example taking on major debt such as a mortgage, or the birth of a child, we often see the paradox that the time when cover is most needed is also the time when household finances are most challenged.

“Mandating an out-of-pocket fee to people in such circumstances, from 2021, is likely to put expert life insurance help out of reach at the worst possible time for them and would likely see people with inadequate or inappropriate cover, or worst still, no cover at all.”

According to Bailey, a major priority for insurers and the advice profession, in partnership with ASIC and government, should be to help create a consistent and robust evidence base to be used by the many stakeholders who will shape the sector over the coming years.

“Life insurance is not without its complexities, and some of the commentary we have heard since the Royal Commission highlights a genuine lack of understanding of the sector and the interplay between the major channels and product types”, he said.

“For example, an appreciation of the differences between group and retail, the dynamics at play, and the role each plays in delivering positive consumer outcomes, does not seem to be evident in many discussions.

“Similarly, it is largely overlooked that since the implementation of LIF, up-front commission rates are now standardised, rendering one of the major objections to commissions – a fear of bias towards products or providers paying higher rates – effectively redundant”.

Zurich supports the Royal Commission recommendation that any consideration of life insurance advice be undertaken in 2021 as part of the ASIC review of the LIF reforms.

Background on Consumer Research

The study, conducted by Rice Warner on Zurich’s behalf, revealed a significant disconnect between the cost of providing life insurance advice and the willingness of consumers to pay for that advice, with only 8 percent of those surveyed indicating they were willing to pay more than $1,000 as an out of pocket fee. By contrast 93 percent of advisers said they would need to charge in excess of $1,000.

None of the consumers surveyed said they were willing to pay $2,000 or more, the amount that almost two thirds of advisers said they would need to charge.

Almost 30 percent of consumers said they were not willing to pay a fee at all, a finding which illustrates the size of the challenge ahead if expert help with life insurance is to remain within reach of everyday Australians.

The research examined the attitudes of 1,000 Australian adults towards a range of issues relating to life insurance advice.

Zurich has published the findings in a whitepaper ‘The Risk Advice Disconnect’, copies of which will be available from Zurich Business Development Managers.

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Kieran Forde

Zurich Financial Services Australia (Zurich) is pleased to announce the appointment of Kieran Forde to the newly created executive role of Head of Bancassurance & Direct within its Life and Investments business.

Mr. Forde joined Zurich from ANZ, in November ahead of the acquisition of the OnePath life insurance business. His appointment has been made ahead of the full Zurich executive leadership structure which will come into full effect on 1 April 2019.

In his role as Head of Bancassurance & Direct, Mr. Forde has responsibility for Zurich’s strategic partnership with ANZ and direct distribution channel, including the Zurich website and third-party partnerships.

He brings more than 30 years financial services experience, having held roles across Australia, New Zealand and the UK, most recently as Head of Wealth Solutions & Partnerships at ANZ, where he had responsibility for managing the partnerships with Zurich & IOOF.

Prior to this he was General Manager of ANZ’s private banking business in New Zealand, and Head of Bank Distribution for ANZ’s wealth business in New Zealand, before moving to Australia in 2014 to lead ANZ’s financial planning business.

“We are delighted to welcome Kieran’s to the Life & Investments executive team,” said Zurich Life & Investments CEO, Tim Bailey.

“He brings strong leadership and relationship management skills, as well as deep financial services knowledge and expertise, and will be an important addition to Zurich as we look to optimise our partnership with ANZ, and our broader Direct strategy, as part of a multi-channel presence.”

Mr. Forde holds a Bachelor’s in Finance and Management from Victoria University in Wellington, and an MBA from Otago University.

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Hugh Robertson

The Association of Financial Advisers (AFA) and Zurich have announced Hugh Robertson from Centaur Financial Services, QLD is the 2018 AFA Adviser of the Year, and West Australian practice, TWD Australia is the 2018 AFA Practice of the Year.

The Awards are presented to extraordinary and visionary advisers and practices, recognising qualities of leadership, innovation, customer focus and professional excellence.

AFA CEO Phil Kewin said, “The AFA congratulates Hugh and TWD Australia for their roles as industry ambassadors in advocating for advice and the great outcomes it delivers.”

Tim Bailey, CEO, Zurich Life & Investments said, “This year’s winners are at the very pinnacle of financial advice. While the advice profession undergoes a transformation, this exceptional adviser and outstanding practice are shining examples for their peers.”

Mr Bailey said there is a heightened responsibility for this year’s winners to demonstrate that quality financial advice is available to all and can play a crucial role in shaping and protecting the lives of Australian families.

“With reputation and trust a driving factor for the whole industry, Hugh and TWD Australia have been able to lift this perception across the profession through their unwavering ethics, unique ideologies and actions. Their leadership and courage can forge a path forward in these challenging times.”

Now in its sixteenth year, the AFA Adviser of the Year Award is a joint initiative between the AFA and Zurich and represents the pinnacle of achievement and recognition for Australia’s premier financial advisers. Nominees submit to a rigorous process and, amongst many other things, are judged for the contribution they make to improving the financial literacy of their clients and their community.

In its fifth year, the AFA Practice of the Year, which is also a joint AFA/Zurich initiative, recognises advice businesses which are at the forefront of taking the profession forward through innovation, customer centricity and advice excellence.

The Awards were presented at a Gala Dinner at the AFA National Adviser Conference on the Gold Coast this evening.

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The composition of the new team reinforces Zurich’s commitment to a dual proposition strategy which will see the Zurich and OnePath Life brands and products continue to operate alongside each other in the retail market.

Completion of the acquisition is expected to occur in March 2019.

The combined business will be led by CEO Tim Bailey, a long term Zurich executive who has led the Australian Life & Investments division since 2015 and whose tenure has seen the acquisitions of both Macquarie Life and OnePath Life.

Gavin Pearce, currently MD Insurance, ANZ will join Zurich as Chief Operating Officer, Life & Investments whilst ANZ’s Linda Griffin will join the Zurich team as Head of Customer and Corporate Affairs.

Zurich’s Chief Distribution Officer Kristine Brooks will lead the Distribution and Marketing teams across the newly expanded business, whilst Matt Drennan continues as Head of Savings and Investments.

Reflecting Zurich’s commitment to a dual proposition strategy in the retail channel, Gerard Kerr as Head of OnePath Propositions and Group Insurance, and Tim Howell as Head of Zurich Propositions, will drive expansion of the OnePath and Zurich market offerings respectively.

Kieran Forde, currently Head of Wealth Solutions and Partnerships, ANZ, will have responsibility for overseeing the strategic partnership with ANZ as Head of Bancassurance and Direct.

After eight years leading the OnePath sales team, Don Sillar has decided to pursue other opportunities. He has agreed to continue as OnePath’s Head of Sales through to completion to ensure continuity and a smooth transition.

In confirming the appointments, Zurich’s APAC Region CEO Jack Howell, said the announcement was another major milestone on Zurich’s journey to become Australia’s leading retail life insurer.

“Our acquisition of the OnePath Life business reflects both our commitment to the Australian life insurance market and our belief in the underlying quality of the business the ANZ and OnePath team has built.

“Upon completion of the acquisition, the newly combined business has an opportunity and a responsibility to take the local industry forward, investing and innovating to deliver ever better customer outcomes.

“This transaction brings together two highly successful businesses, each with a strong brand heritage and loyal customers. The senior leaders of both businesses are amongst the most talented and respected in the industry,” Howell said.

Commenting on the announcement, Life & Investments Australia CEO Tim Bailey said that the new combined team leveraged the depth of experience across both the Zurich and OnePath businesses.

“The balance of the team also sends a powerful signal about our intention and capability to execute our dual proposition strategy.

“We will continue to invest extensively in both the Zurich and OnePath brands and propositions, ensuring both advisers and customers can benefit from genuine choice and a superior customer experience,” Bailey said.

Until completion of the transaction in early 2019, the existing leadership teams will remain in place at both Zurich and ANZ Wealth with both businesses continuing to operate on a separate, business as usual basis until then.

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Tim Bailey, Zurich CEO

At a time of intense scrutiny on the financial services sector, it is easy to lose sight of the inherent social purpose underlying the myriad of products and services it provides.

This is especially true of life insurance, where the $10 billion life insurers pay in claims each year isn’t widely appreciated; except perhaps by the tens of thousands of individuals, families and small businesses who are the recipients of these benefits.

They, and their loved ones, understand better than most the role that life insurance plays in keeping a roof over their heads, helping them pay their mortgage or their rent, when accident, illness or worse cuts off an income stream – either temporarily or permanently.

There’s a clear mental health benefit too, which is why I like to think of our industry as part of a broader ecosystem, also comprising the healthcare and social security sectors. The members of this ecosystem work together to provide physical, financial and emotional wellbeing across the community.

A few years ago Zurich conducted research showing that nearly 40% of Australians could survive for no more than one month without their income, before they would need to start selling their assets. It’s a frightening reminder of how precarious the finances of many households actually are.

Financial difficulties are one of the leading causes of homelessness in Australia. Underlying those difficulties can be many different – and often interconnected – factors; it could be someone losing their job, or suffering mental illness, or going through a relationship breakdown. In some cases all three come together.

Sadly it’s a growing problem. On the night of the 2016 Census, over 116,000 people were classified as homeless. In NSW the homelessness rate increased by 27% between Census periods.

Whilst there is no easy solution there are plenty of organisations and individuals doing their best to help find one. One such organisation is Vinnies. In a few days I will get the chance to represent Zurich at the Vinnies CEO Sleepout. For more than a decade this event has been helping put a roof over the heads of society’s most vulnerable people, raising more than $42 million to fund homelessness services across Australia.

These services include shelter, food essentials, and other vital support. As little as 100 dollars can provide a night’s emergency accommodation for a family, so the millions that this event will raise can provide a lot of help to a lot of people.

I see a many parallels between the services Vinnies and others like them provide and the role life insurance plays in protecting people’s emotional, physical and financial wellbeing. And that’s why I am taking the opportunity to do the Sleepout this year.

Last year’s event raised more than $5.6 million nationwide, funding over 1.5 million meals, nearly 700,000 beds and nearly 2 million individual support programs.

This year’s target is $6.4 million, and as I write they are more than halfway to achieving that goal. Which means your help is needed.

Increasing awareness of the homelessness issue is vital if we are to make any progress towards solving it. So at the very least please visit ceosleepout.org.au to find out more.

And if you can make a financial contribution, or become a volunteer, even better. Every dollar and every action, no matter how small, counts.

Visit ceosleepout.org.au to donate.

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Tim Bailey

Zurich has confirmed it will keep both the Zurich and OnePath brands and propositions active in the market after its planned acquisition of the OnePath Life business later this year.

Speaking to financial advisers at a recent roadshow, Life & Investments CEO Mr. Tim Bailey reiterated Zurich’s plan to continue investment in both the Zurich and OnePath brands and propositions, with the two product ranges to operate alongside each other in the open market.

“We know that both the Zurich and OnePath propositions are very highly regarded in the market and are regularly acknowledged for their strength across claims service, product innovation and value for money,” he said.

At the roadshow events, which attracted more than 1000 registrations nationally, Bailey observed that many advisers already used both Zurich and OneCare product suites on a complementary basis, finding the solutions often suited different client segments with different needs.

Against a background of insurer consolidation, many advisers also indicated a concern about diminishing choice of propositions.

“Advisers are telling us they need more choice not less. The OneCare product range is well established and well regarded by customers and advisers alike, and we plan to invest further in that range, giving advisers more options to tailor cover to the specific needs of their clients.”

Later this year ownership of the entire OnePath business will transfer from ANZ, with IOOF acquiring the Pensions and Investments component and Zurich acquiring the life insurance business.

Both transactions are subject to regulator approval.

After a period of sharing the brand whilst the final stages of the separation are completed, Zurich will become the permanent owner of the OnePath brand.

“As part of this transaction, Zurich will fully acquire the OnePath brand and logo,” he said.
Bailey also shared with advisers a timeline for the transaction, explaining that all parties were making excellent progress towards the planned late 2018 completion date.

“We’ve have very strong enduring partnerships with ANZ and IOOF going back many years and this has helped us make excellent progress with a reasonably complex transaction,” said Mr. Bailey.

“Our collective objective is to offer staff, customers and the market place ongoing clarity around the process and outcomes, and the collaborative nature of all stakeholders has helped us do just that,” he said.

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