Pinnacle questions PAA stance

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Pinnacle Life, which sells insurance online directly to customers, reckons advisers should be more upfront about their commissions.

Thursday, June 28th 2007, 10:25PM

The company's chief executive, Ed Saul, is critical of comments made by the Professional Advisers Association chief executive Dave McMillian in Good Returns.

McMillian suggested that commissions on life insurance should have different disclosure requirements to investments.

His comments were made in response to government's announcements last week regarding regulation of the advisory sector.

"We are not convinced that the unique nature of life insurance compensation is fully understood by the Ministry (of Economic Development)," McMillian said.

Saul expresses a different view in his Blog: "On the contrary, I think the ministry understands perfectly"."

"I firmly believe that consumers have every right to know how much their financial advisor is paid by the insurance companies."

Saul went on to question whether commissions in New Zealand are "embarrassingly high".

And answered the question himself:"Commissions paid to financial advisers in New Zealand are amongst the highest in the world," he says.

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