What the FMA will do next

It has today released its report into replacement business in the life insurance industry.

Looking at data from the country’s main insurers, it identified that 200 of the 1100 advisers with more than 100 active life policies on their books met the FMA’s criteria for a high estimated rate of replacement business.

That criteria was that at least 12% of an adviser’s policies lapsed and the adviser wrote at least 12% of policies as new business within one year, to least 40 lapsed in a month and the adviser wrote 40 new policies in the same month.

FMA director of regulation Liam Mason said the regulator had not made contact with any adviser that it had identified as potentially replacing worryingly large amounts of business.