Advisers welcome Partners' move to cancel trips

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Feedback has been positive to Partners Life's move to step back from high-profile international conference. Now AIA and Sovereign question the future.

Thursday, October 25th 2018, 6:00AM 1 Comment

The insurer – previously one of the more high-profile providers of international events for advisers – revealed last week that its next trip will be its last.

Managing director Naomi Ballantyne said ensuring clients’ trust in the industry was paramount.

“And we have also heard repeatedly, and increasingly more assertively, from our regulators that soft dollar incentives such as offshore conferences for advisers are causing reputational damage to the New Zealand financial services industry.

"While they understand there is value created for both the adviser and the insurer from these conferences, they are not convinced that consumers benefit sufficiently to offset the potential for incentive driven conflicts to negatively influence the advice consumers receive."

Ballantyne said she had not had a lot of response to the announcement but what there had been, had been consistent – advisers expected it and thought it was the right thing to do. “We haven’t had any negative feedback at all.”

She said the seed of the idea had been planted at the last conference in Hawaii. Advisers were asked, in light of the regulatory environment, with the Financial Markets Authority indicating its concern about soft dollar incentives, how they felt about conferences.

Ballantyne said most had said the insurer should still offer them.

But she said that was less important than the fact that the idea had been floated to get people thinking.

“Since then the regulator has been loud in their opinion. For a lot of advisers it’s almost a relief that someone has made that decision for them.”

She said Partners Life was prepared to lose business as others continued to offer the incentives. But it would focus on its products. “If our product is good enough we should get our share of the business.”

Ballantyne said she was not making the change to prove a point but because it was the right decision to make at this point in time.

Jon-Paul Hale, of Willowgrove Consulting, said the trips were an opportunity for advisers to learn from each other, and also to build relationships with the provider.

"Sure they have the ‘sales’ generation opportunity both with the trip as an incentive, but also though the depth of relationship with the provider. For others it is a chance to get away and have a break, there is a significant emotional and psychological toll that advisers take on when they choose this career. It’s tough dealing with your clients, who often become good friends, when they go though disabilities, cancers, and ultimately passing away. To travel and recharge with a group of like-minded people is somewhat healing, and certainly supportive as often advisers work in a lot of isolation with the job. Not many around us understand what we actually do.

"Naomi is a smart operator and the noise that trips send the wrong message is growing, in an industry trying to bridge the gap to profession. Add to that the conduct coming out of Aussie, it’s just not the PC thing to be doing. Partners Life aren’t the first and others will follow."

Katrina Church, of Insurance People, agreed it was a good move because the trips clouded perceptions of the industry.

"Going to conference has not been a reason to write business with any insurer. Policy wordings, service, relationships and claim outcomes are the reasons we write with the insurers we write. What’s right for the client.

"In the last couple of years we have chosen to invest in our own professional development and spent time going to MDRT annual meetings which have had an incredible amount of networking, learnings and motivational speakers on an international stage. This in turn has helped grow and establish a stronger business. With all insurers the focus will be how they form relationships with advisers that have strong bonds going forward. I am positive they will continue to do this regardless of overseas trips."

A spokesman for AIA and Sovereign said it had not made a firm decision on the future of its trips.

“How AIA and Sovereign recognise top achievers, and how that ultimately serves our customers’ needs, is something we continue to consider our position on, and refine where appropriate. There are currently no plans at this stage for any overseas conferences beyond 2019.”

Tags: Partners Life soft commission

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