Life insurance software Platform, LifeBid, is nearing the pilot launch phase for an industry solution aiming to potentially reduce the cost of delivering risk advice to Australian consumers by up to 90%.
Presenting to his adviser peers at the recent AFA Conference on the Gold Coast, adviser and LifeBid Director, Brett Wright, said the industry has seen a halving of life insurance new business over the last five years, a decline in inforce business, and rising claim numbers, while at the same time witnessing a significant reduction in specialist risk adviser numbers.
Wright told those in the packed conference hall that these issues keep advisers – as well as industry stakeholders – awake at night. He says the current regulatory environment sees advisers take 10 to 15 hours to help the average client with their risk advice needs.
“It’s too long, too complex and just isn’t a viable way of doing business anymore,” he said.
While not yet locked-in, Wright indicates a typical cost per adviser for using LifeBid might be in the region of AU$300 per month, and approximately $70-$90 per month for support staff.
He described the LifeBid industry platform as a single operating system that’s supported by most insurers, and intended to replace the multiple system platforms presently needed within a risk advice process, while at the same time reducing the complexities and increase efficiencies related to all the elements associated with the life insurance advice and processes.
These processes include meeting compliance obligations, the onboarding of life insurance new business, and ongoing management of client policies, renewal processes, claims management and virtually all other life insurance policy administration processes.
Without an industry solution, we’re in real strife…
“Without an industry solution, we’re in real strife,” said Wright, who concluded that the middle Australian consumer market had become disconnected from life insurance because those who are asking for help are often turned away – due, he says, to the cost of providing the risk advice compared with the capped remuneration they would be permitted to receive.
“Life insurance advice can’t survive in its current form without an end-to-end revolution,” said Wright.
As he did when initially launching the LifeBid proposition, Wright used the analogy of Blockbuster Video and Netflix, saying everyone today wants the Netflix experience, but implied the life insurance consumer is still subject to the more manual Blockbuster-type processes.
He also referenced another analogy by relating that what Xero has become for accounting, he seeks the same impact for LifeBid in disrupting the life insurance process.
Wright added that the additional capacity created by this significant reduction in cost and time to advise clients should provide advisers the ability to serve more consumers and to spend more of their time in client-facing engagement.
In a panel discussion following Wright’s presentation, Zurich’s head of distribution, Kieran Forde, said the LifeBid proposition gives the entire sector “…real hope and opportunity to significantly reduce the cost of delivering [risk] advice” – and to change the economics and attract more advisers back into the risk advice space.
…there are already more than two thousand advisers registered on the LifeBid waiting list…
Wright told conference delegates the pilot stage of LifeBid will roll out towards the end of 2022 for a selection of practices operating within its working group of licensees, including Centrepoint Alliance, with the intention to offer advisers outside this working group access to the platform in early 2023.
While he cautioned that the timing of the roll out of such a significant project ultimately remains subject to the chain of stakeholders each being able to deliver completed elements, Wright confirmed the project will definitely launch and that there are already more than two thousand advisers registered on the LifeBid waiting list.
In response to a question about costs, Wright said the strategy is to position LifeBid as an industry utility that can be accessed by all, with the cost spread evenly and fairly across all stakeholders including insurers, licensees and advice providers.