Life adviser findings
02 Oct 2017
The Financial Markets Authority (FMA) says it will release findings from a targeted review of 24 life insurance advisers with a high level of policy churn by the end of this year.
The regulator selected the advisers for deeper investigation after a report last year identified 200 advisers with high levels of replacement business.
“We’ve taken a closer look at the conduct of a smaller group of those advisers,” the FMA says in its annual report. “We wanted to find out where there were genuine reasons for replacement and where there were no apparent benefits to clients.”
The FMA had previously discovered a strong link between high levels of replacement and the types of commissions or incentives received.
FMA CEO Rob Everett said the regulator was committed to contributing to high standards of behaviour across the sectors it regulates.
“Therefore we expect a healthy debate – and sometimes resistance – about the influence we want to exert on how providers engage with their customers,” he said.
“We encourage, guide, and occasionally compel, providers and intermediaries to think about how they are serving their customers.”
The FMA recorded a loss of $NZ3.4 million ($3.1 million) in the past financial year, narrowing from $NZ4 million ($3.7 million) a year earlier. Revenue was little changed at $NZ29.6 million ($27.1 million).
The FMA handled 1045 complaints, up from 968 a year earlier, with financial statements accounting for 21% of the total. It also received 3211 enquiries.