I can envisage a time when my advice practice may charge a fee for life insurance claims support services.
- Disagree (52%)
- Agree (37%)
- Not sure (11%)
Loading ...Kiwi advisers appear to be divided on the question of charging fees for claims support services.
As we go to print this week, a small majority (52%) of those voting in our latest poll say they cannot envisage a time when their practice might charge a fee for their claims support services – and one comment we’ve received probably encapsulates the thoughts of many supporting this view:
“This is why we get a renewal commission/servicing fee. The only time we will consider charging the client is if they are not our client and their adviser is too lazy to do their job.”
On the other hand, almost four in ten (39%) say they can envisage the future prospect of charging fees for claims support, with around one in ten undecided.
In the Australian market, as we noted last week, there’s more of an imperative for advice practices to streamline costs and efficiencies within their businesses – especially in risk advice practices – due to the increasing costs to deliver advice, combined with the maximum commission caps that have been imposed.
Across the Ditch, some advice businesses have developed an offer along the lines of the comment made above, in that they will charge non-clients who have been referred to them to assist them with their claim, but the clients of the business will not be charged.
There are also a growing number of advice businesses – especially financial planning/non-risk specialist firms – who are directing their clients to independent firms who specialise in the nuances of what it takes to secure a successful claim for the client. In these cases, it’s the client – the claimant – who pays, but usually only if their claim has been approved.
It’s likely the New Zealand advice sector will be spared the same challenging commercial conditions imposed on it as those faced by advice businesses operating in the Australian market. But crises have a habit of forcing – or at least accelerating – change (think pandemic), which is one reason why momentum is growing in the Australian market for paid claims support services. Only time will tell whether this trend will find its way to our shores.
Our poll remains open for another week and we welcome your thoughts…