AIA offers more commission

AIA is making changes to its commission structure that it says aims to help businesses struggling with cashflow shortfall – and some advisers will qualify for 230% upfront.

Tuesday, June 2nd 2020, 4:00PM

It is also developing a scheme through which it will give financial advisers $500,000 to pursue projects that help them make a difference.

AIA said 2020 had been a challenging year and feedback had indicated that the biggest issue for advisers and their businesses was cashflow.

That had prompted it to launch a 20/20 in 2020 offer that was designed to “share the value of going digital”, it said, and support small businesses.

It will extend until September 1 its existing 20% extra basic upfront commission on AIA Living applications submitted via its eApp. It said submissions in this way created operational efficiencies and created better outcomes for customers.

From that point, an extra 10% would be paid for eApp applications.

It will also add another 20% during that period, which it said was designed to help advisers make the shortfall from a general decline in new business in the market. That meant someone who would normally get 190% upfront would receive 230%.

“A recent survey found that half of all those surveyed said that Covid-19 was impacting their job security and that over 40% worry about money at least weekly. The survey also found that confidence in making financial decisions had reduced," said chief executive Nick Stanhope.

“New Zealand’s financial advice firms are primarily small businesses employing fewer than five members of staff. Financial advisers play a crucial role in increasing the financial resilience of New Zealand households which is now more important than ever. Because of this we wanted to do our bit to support financial advisers and customers at this time, in line with our purpose of making a difference in people’s lives."

Those receiving as-earned commission would have the additional commission added to payments over 24 months.

It is also launching a community and business grant programme, wortha total of $500,000, to fund financial advisers. Advisers can apply for a grant to help their business make a difference to their customers, families and community.

The programme has been designed to encourage advisers to develop, design and implement initiatives to support community wellness and to raise awareness of the importance of health and wellbeing to overall financial resilience. More details, including how to apply and the application criteria will be released to financial advisers in due course

AIA New Zealand’s chief partnership insurance officer, Sam Tremethick, said advice was more important than ever.

“We hope that the two support packages announced today will go some way towards cushioning the effects of these difficult times on the financial advice sector,” he said.

AIA said that advisers had to comply with its conduct standards and when the eApp was not completed accurately or appropriately, it reserved the right not to pay the extra commission.

Tags: AIA Commission Life insurance