AIG Life changes commission structure
AIG Life is rolling out its new adviser remuneration package which includes loyalty benefits and takes it out of the commission wars.
Monday, February 2nd 2009, 9:30AM
The package, called Distinction, is built around grouping advisers based on the amount and quality of business they write for AIG Life.
There are five tiers, CEO Club, Platinum, Gold, Silver and Bronze. Commission will be tiered in line with these give bands and the higher up an adviser is the more benefits they get.
For instance members of the CEO club will automatically get $250,000 life and TPD cover for themselves, a range of vouchers for use at Paper Plus, MTA outlets and the Warehouse Stationary, along with membership to either the Koru Club or Qantas lounges, contributions to training courses, and AIG’s lifestyle check.
AIG Life chief executive David Pierce says the benefits are “meaningful stuff”, they are not, he says, “trinkets, trivia and trash.”
The company will no longer conduct trips offshore for advisers.
As part of the change AIG Life is changing the level of service it provides advisers. Each of its nine regional sales managers will look after a maximum of 50 advisers each. These RSMs will provide personal service to advisers.
Those advisers who fall outside of this will be serviced by in-force sales consultants based in AIG Life’s head office.
Pierce says the change is designed to reward advisers who write business for the company, but is also aimed at taking the company out of the current commission war be waged by a number of life offices.
He says New Zealand life companies pay unsustainably high commissions to advisers and brokers.
Pierce describes the change as a “fresh approach” to adviser remuneration and something “that’s a bit revolutionary.”
“It will help the true professional advisers who are serious about building their businesses.”
The Distinction programme is being rolled out in phases. The first, shows the soft benefits, next AIG Life will announce the different tier levels and their associated benefits.
These will be tiered and will include persistency measures.
AIG Life is also planning to reward advisers who submit applications electronically as there area cost savings to the company which can be passed onto advisers.
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