[Opinion] CPD – identifying the stuff we don’t know but really should

Opinion: The Code requires advisers to do annual CPD (Continuing Professional  Development). I come across various questions from life advisers about CPD, so I thought the beginning of the year might be a good time to share my thoughts on those questions regarding CPD for giving life and health insurance advice (not that required for selling or running your business).

Wednesday, January 22nd 2025, 11:43AM

by Steve Wright

Opinion: The Code requires advisers to do annual CPD (Continuing Professional  Development). I come across various questions from life advisers about CPD, so I thought the beginning of the year might be a good time to share my thoughts on those questions regarding CPD for giving life and health insurance advice (not that required for selling or running your business).

WHY MUST WE DO CPD?

Why is CPD necessary? Doesn’t achieving the relevant Level 5 qualification make me completely competent?

In my opinion it does not, particularly in respect of products and product recommendations, but also other matters. As I see it, the Level 5 qualification is only an adviser’s ticket to the game. It allows them on to the field but it’s no guarantee the Ref isn’t going to red card them. More is needed to continually improve knowledge and hone advice skills to avoid the Ref’s pocket. I suspect the Code Committee understood this, hence the Code requirement for CPD.

I’ve said it many times, life and health insurance advice is complex and life advisers are required by law to give advice with the care, diligence and skill of a prudent adviser. This requires knowledge of a great many issues, and expert knowledge of some, as well as the practical understanding and experience to mold that knowledge into acceptable advice. Constant learning is a reality for all professionals, including life advisers.

WHAT CPD MUST I DO?

The Code doesn’t prescribe the CPD required. Every adviser must identify their own knowledge and skills gaps and complete appropriate ‘learning activities’. What CPD is required of each adviser can be a head scratcher, simply because none of us knows what we don’t know. This means gaps in our knowledge and competence can remain unidentified for a long time, potentially putting our advice at risk of the red card being pulled.

The most important part of CPD in my view is understanding WHAT needs attention. Once you’ve identified the knowledge gap, find the appropriate way of closing that gap.

FAPs have a similar CPD obligation to ensure their advisers acquire and maintain suitable knowledge and skills and are able to give acceptable advice.

HOW DO I IDENTIFY THE CPD I NEED?

When we don’t know what we don’t know, identifying a CPD need means we must find a proactive way of identifying our knowledge gaps. Of course, no individual can comprehensively identify unknown areas where CPD is needed without assistance and some form of assessment.
I think a list of knowledge items that all life advisers should know sufficiently to give acceptable advice can be of great help. The FMA suggests that FAPs and advisers create, and maintain, a ‘skills matrix’ to identify knowledge and skills essential for complying with the law and the Code. I think that is a great idea.

A suitable ‘Devil’s Advocate will likely be useful for identifying less obvious things advisers might be expected to know.

WHERE DO I GET CPD?

Where to get the CPD we need can be a challenge. In some cases, there might be a course you could take or training you could attend, while in others, some form of self-learning or group learning, including with the assistance of people knowledgeable in the issue, may be required.

When it comes to the legal/technical (not IT technical) insurance knowledge required to give advice, it’s important to ensure any information you get is accurate, reliable and relevant and that the person imparting that knowledge can explain the relevance, possible consequences and likely outcomes. Cross checking information and confirming it via other sources is important.

One way of confirming information is to require whoever is helping you, to provide ‘authorities’ (or sources of truth) to back-up their positions, explanations or views. For life insurance advice, such ‘authorities’ include things like policy wordings, laws or Court decisions (and maybe Dispute Resolution Scheme findings).

I suggest ‘fact checking’ by reviewing these authorities yourself. I know this is extra work, but the process of checking for yourself will do several good things for you:

Firstly, the knowledge will be better cemented into your memory and even if you forget the detail, you may remember where to get it, and the need to get it, later.

Secondly and maybe more importantly, once you yourself have seen the authority and its accuracy, you can be fully confident of your knowledge and this confidence will be picked up by clients, improving your chances of business success.

WHEN MUST I DO CPD?

The Code requires that all advisers, at least annually, plan for and complete CPD. I think the beginning of the year is the ideal time to do CPD planning, so that the process of accessing the CPD identified can get started.

Steve Wright – Has qualifications in economics, law, tax, and financial planning. He has spent the last 20 years in sales, product, and professional development roles with insurers. He is now independent and helping advisers mitigate advice risk through training and advice coaching.

This article is for information purposes only, its content is the writer’s opinion and intended to be of a general nature, does not take into account any person’s specific circumstances, and is not financial, legal, or other advice. It is recommended you seek advice from a suitable expert before taking any action in relation to anything contained in this article.

Steve Wright has qualifications in economics, law, tax, and financial planning. He has spent the last 20 years in sales, product, and professional development roles with insurers. He is now independent and helping advisers mitigate advice risk through training and advice coaching.

Tags: CPD insurance Steve Wright