Chatswood serves the life and health insurance sector in New Zealand with market intelligence, data, and bespoke consulting services. Some of these are provided in conjunction with Quality Product Research Limited - a subsidiary that brings you Quotemonster.

We believe that good decisions are more likely to occur when we have good information about the market environment in which we operate. Intuitive leaps and creative decisions are always required, of course, but the more they are based on a firm foundation of observation, the better they tend to be.

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FMA cancel FAP licence – advice process, record-keeping, disclosures, and evidence of suitability all factors

The Financial Markets Authority (FMA) has cancelled Filcare Services Limited’s (Filcare) Financial Advice Provider licence, at its request. 

The Financial Markets Authority (FMA) has cancelled Filcare Services Limited’s (Filcare) Financial Advice Provider licence, at its request

Filcare held a full financial advice provider licence, and they provided financial advice to approximately 1,800 retail clients, many of whom were migrant workers from the Filipino community. Its cancellation follows the termination of its distribution agreement with Fidelity Life Assurance Company Limited and AIA New Zealand Limited and the FMA’s inquiry into its affairs.

Filcare were found to have contravened its licence obligations by failing to:

  • keep adequate records in relation to advice given to its clients,  

  • ensure its clients understood the financial advice they received,  

  • exercise care diligence and skill when providing financial advice to its clients,  

  • provide adequate disclosures relating to advice, and  

  • demonstrate that recommendations made to clients were suitable.  

From our perspective, that appears to indicate failures in a wide range of areas of the advice process. As a comparison business we are particularly concerned with the areas of care, diligence, and skill, and demonstrating suitability – which we help more than 1,100 advisers with.

FMA’s Head of Perimeter and Response Helena Lewis said

“…we observed that clients did not receive adequate nature and scope disclosures and were therefore unable to make an informed decision about whether to seek, obtain, or act on the advice.

We also found that Filcare advisers failed to demonstrate that the recommendations made to clients were suitable. As an example, for a vast majority of clients, the documentation on file lacked the requisite detail to clearly show how the selected levels of cover were determined, and that the recommendation matched the risk tolerance, financial situation, and needs and goals of the client.

In files concerning replacement advice, there was no evidence that clients were informed of the potential risks of replacing existing policies, such as losing benefits they might have otherwise received under original policies, or the likelihood of exclusions or limitations associated with changes in health, lifestyle, or occupation that have occurred since the original policy has been taken out.”

Filcare clients with concerns are able to complain to Financial Services Complaints Limited.

 

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New Zealanders continue to have a low uptake of personal insurance

New Zealander’s low uptake of insurance is in the news again, with Willie Moala listing some of the reasons why more New Zealanders don’t have personal insurance.

New Zealander’s low uptake of insurance is in the news again, with Advice First’s Willie Moala listing some of the reasons why more New Zealanders don’t have personal insurance. Moala considers the kiwi ‘she’ll be right’ attitude, a distrust of insurance companies, price, and the mistaken belief that ACC will cover people in more instances than it actually does, all lead to people failing to get adequate insurance cover.

Last year the Financial Services Council’s Money & You: Managing Risk Through Challenging Times research found that only 41% of respondents had life insurance, 39% had health/medical insurance, 23% had trauma/critical illness insurance and18% had total and permanent disability insurance.

With the Government’s announcement that financial education will be embedded in the curriculum for Year 1 – 10 students, starting from next year, we can only hope this will help change attitudes around the importance of insurance, and in the longer-term help improve NZ’s underinvestment in insurance.

 

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Law firm has concerns about impending changes to the Financial Markets Conduct Act

Study finds NZ banks typically outperformed insurers in the climate-related disclosure regime

ASB appoint Frank Jasper as chief investment officer

MAS sponsor Otago Medical School's 150th anniversary

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MAS announce appointment of new CEO

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Bigger not necessarily best when it comes to KiwiSaver

Big banks, with their brand recognition and big budgets, have long been an almost default choice for people deciding who to invest their KiwiSaver funds with. That looks like it’s starting to change.

Consumer NZ has taken a look at how KiwiSaver is going. Big banks, with their brand recognition and big budgets, have long been an almost default choice for people deciding who to invest their KiwiSaver funds with. That looks like it’s starting to change. Encouragingly, 29% of new members chose their KiwiSaver scheme independently, and 8% consulted a financial adviser about what their best option would be, though 14% were automatically allocated a default scheme. There is still some reluctance to change providers, with 12% of people feeling it’s too much hassle to change provider, 8% having thought about switching but haven’t gotten around to it and 5% not knowing where to start.

With more than 3.3 million members and more than $111 billion of total funds under management, it’s worth putting in a little effort to see which fund best suits your situation.

While banks in general are big spenders on advertising, ANZ outspends them all. Yet ANZ’s KiwiSaver returns are underwhelming, coming in last (12th) for its management of conservative KiwiSaver funds, 6th (out of 12) for moderate funds, second to last (out of 15) for balanced funds and 10th (out of 12) for growth funds, according to Morningstar’s December 2024 results. Yet ANZ holds the largest share of the KiwiSaver market, with $21.9 billion funds under management.

As of 2021, ANZ and ASB are no longer default KiwiSaver providers, leaving BT Funds (Westpac) and BNZ as the only default big bank providers for new members. It will be interesting to see how this impacts the various banks’ KiwiSaver market share over the next decade or two.

In good news, Consumers NZ’s annual survey on KiwiSaver satisfaction highlights growing satisfaction, with February 2025 results showing 82% were satisfied with their provider.

And what do people most want from their KiwiSaver provider? Good returns with responsible investments came out top (42%), followed by the best returns (37%) and investing responsibly, even if it comes with slightly lower returns (14%)

 

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Legal and regulatory update for the life and health insurance sector

RBNZ Board is in the process of preparing a recommendation for the appointment of a Governor; FMA announce review of advice sector; FMA release regulatory returns snapshot; FMA publish Samantha Barrass’ speech; FMA release latest Jess Learns to Invest podcast; APRA accept Court Enforcable Undertaking from ANZ; Hon Scott Simpson’s March 2025 diary released; COFR held quarterly meeting; FMA publish fair conduct programme insights report; RBNZ welcome applications to ESAS under new criteria.

1 Apr 2025 - The RBNZ Board is in the process of preparing a recommendation for the appointment of a Governor for six months and will be sending it to the Minister soon. https://www.rbnz.govt.nz/hub/news/2025/04/process-for-the-appointment-of-a-governor-for-a-six-month-term

2 Apr 2025 - FMA announce a review of the advice sector to help drive better outcomes for industry and consumers. It will focus on four key themes, which are:

  1. Consumer preferences and demographics

  2. Industry business models

  3. Digital advice and innovation

  4. Ease of provision of financial advice

https://www.fma.govt.nz/news/all-releases/media-releases/fma-unveils-review-into-financial-advice-accessibility/

2 Apr 2025 - The FMA release a Regulatory Returns snapshot for 1 July 2023 – 30 June 2024. Key statistics (as of 30 June 2024)

  • 1410 licensed financial advice providers submitted regulatory returns

  • 8472 financial advisers compared to 9300 in 2021

  • Life and health insurance are the most common financial products advice is provided on

  • 36 FAPs are providing digital advice and 86,500 retail clients received digital advice

  • 97% of complaints received were settled within 3 months.

https://www.fma.govt.nz/library/reports-and-papers/financial-advice-providers-industry-snapshot/

2 Apr 2025 - The FMA publish Samantha Barrass' speech from the Financial Advice New Zealand Conference. https://www.fma.govt.nz/library/speeches-and-presentations/financial-advice-new-zealand-conference/

2 Apr 2025 - The FMA release Jess Learns to Invest Episode 3 | Understanding Managed Funds with Tom Hartmann. https://www.fma.govt.nz/library/podcast/jess-learns-to-invest-episode-3/

3 Apr 2025 - APRA has accepted a Court Enforceable Undertaking from Australia and New Zealand Banking Group (ANZ) to address ongoing weaknesses in the bank’s non-financial risk management practices and risk culture. https://www.apra.gov.au/news-and-publications/apra-accepts-court-enforceable-undertaking-from-anz-and-increases-capital-add

4 Apr 2025 - Minister of Commerce and Consumer Affairs, Hon Scott Simpson, March 2025 diary released with the following potential financial services sector related meeting noted:

  • 6 Mar 2025 – MEET: Commerce Commission Chair and CE (Dr John Small, Adrienne Meikle)

  • 10 Mar 2025 – MEET: NZ Banking Association CE (Roger Beaumont)

  • 10 Mar 2025 – MEET: FMA Chair and Acting CE (Craig Stobo and Liam Mason)

  • 10 Mar 2025 – MEET: Financial Services Stakeholders (Carl Blanchard & invited guests)

  • 10 Mar 2025 - SPEAK: Financial Services Forum

  • 11 Mar 2025 – SPEAK: Fintech Hui

  • 13 Mar 2025 – MEET: Financial Ombudsman Reviewer (Nanette Moreau)

  • 18 Mar 2025 -MEET: Financial Services Council CE (Kirk Hope)

  • 18 Mar 2025 – MEET: ASB CEO (Vittoria Short, Louise Griffin)

  • 19 Mar 2025 – MEET: FAMNZ (Leigh Hodgetts)

  • 24 Mar 2025 – MEET: NZBA (Roger Beaumont and Dan Huggins)

  • 25 Mar 2025 -MEET: CE of Westpac (Catherine McGrath)

  • 26 Mar 2025 – MEET: Banking Ombudsman CE and Chair (Nicola Sladden and Miriam Dean)

  • 26 Mar 2025 – MEET: Retirement Commissioner (Jane Wrightson)

  • 27 Mar 2025 – MEET: FINCAP (Jake Lilley, Fleur Howard)

  • 27 Mar 2025 – MEET: Financial Service Federation (Katie Rawlinson)

  • 28 Mar 2025 – ATTEND: NZ Banking Assoc Council

  • 31 Mar 2025 - MEET: Suncorp CEO (Jimmy Higgins)

https://www.beehive.govt.nz/sites/default/files/2025-04/Proactive%20Diary%20Release%20Simpson%20Mar%2025%27%20.pdf

4 Apr 2025 - The Council of Financial Regulators (CoFR) held its quarterly meeting on Monday 24 March 2025. The Council discussed the key external factors that could impact the financial system, noting in particular the rapid developments in artificial intelligence and ongoing geopolitical uncertainty. The Council reviewed developments in New Zealand’s payments system and noted the importance of upcoming developments like the passage of the Customer and Products Data Bill. https://www.cofr.govt.nz/news-and-publications/quarterly-statement-by-cofr-march-2025.html

4 Apr 2025 - The FMA have published their fair conduct programme insights report. https://www.fma.govt.nz/library/reports-and-papers/fair-conduct-programme-insights-report/

7 Apr 2025 - The RBNZ is welcoming applications to the Exchange Settlement Account System (ESAS) under new access criteria announced on 31 March 2025. https://www.rbnz.govt.nz/hub/news/2025/04/rbnz-welcomes-new-applications-to-the-exchange-settlement-account-system

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Fidelity Life announce premium changes

Effective from 1 April 2025, Fidelity Life are re-rating the premiums for customers in the Adviser channel.

Effective from 1 April 2025, Fidelity Life are re-rating the premiums for customers in the Adviser channel. Key aspects are below:

  • A re-shaping of the pricing curve to reflect a lower risk due to the underwriting selection effect.

  • A 5% increase to all lump sum premiums and disability premiums (where the benefit period is 2 or 5 years). And a 7.5% increase to all disability covers with a benefit period of ‘to age 65’ or ‘to age 70’ due to claims experience.

  • An adjustment of the rates for all customers.

 

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Fidelity Life open applications for training programmes

Fidelity Life has opened applications for Advice Masters, Professional Pathways, Practice Manager Masterclass and Career Connect.

Fidelity Life has opened applications for Advice Masters, Professional Pathways, Practice Manager Masterclass and Career Connect.

Applications are open for Advice Masters, Fidelity Life's intensive training and personalised professional development programme designed for experienced business owners in the financial services industry. The programme encompasses a wide range of topics: M&A; capital raising/funding strategies; high performance for business leaders; leading high performing teams; business strategy design and execution; governance; board craft; director skills and sustainability; business efficiency; technology and AI. The 30 available spots are by invitation only – interested people can talk to their business manager or apply here.

Professional Pathways is Fidelity Life's customisable extended training and development programme designed for motivated advisers, who are dedicated to growth and achieving their business goals. Over a 9-month period the programme will take participants through key topics – developing their business; advice and planning; business sales and growth; business efficiency. The programme consists of skills based workshops, self-paced learning through courses, resources and quizzes, online webinars and interactive online workshops.

Practice Manager Masterclass are targeted at admin staff and will help to improve workflow and productivity.

Career Connect is Fidelity Life's comprehensive education and skills programme designed to develop the next generation of financial advisers. Career Connect equips participants with relevant qualifications, practical skills and knowledge, and industry connections. The 2025 intake will commence in May and will run for 6 months. Applicants will be invited for an interview and the fee for the programme is approximately $1650.

 

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FMA announces more than $215 million returned to customers through remediation

The Financial Markets Authority (FMA) has released its annual report for the year ended 30 June 2024, including information on the money being returned to customers as a result of remediation activity stemming from the Conduct and Culture review.

The Financial Markets Authority (FMA) has released its annual report for the year ended 30 June 2024. One of the most interesting findings to come from the annual report was that $215 million has been returned, or is in the process of being returned, to customers as a result of remediation activity stemming from the Conduct and Culture review of banks and life insurers carried out by the Reserve Bank of New Zealand (RBNZ) and the FMA between 2018 and 2019. As at June 2024, 1.585 million affected customers had been identified. You can read about some of the filings from this year here.

The FMA achieved six out of nine of its Statement of Performance Expectations. Some key achievements included several penalty decisions for fair dealing provision breaches, opening licensing for the Conduct of Financial Institutions (CoFI) regime and producing the first Financial Advice Provider Monitoring Insights Report.

The FMA have also released the results of their Ease of Doing Business Survey which reports on stakeholder and industry participants views on the effectiveness of their interactions with the FMA.

  • 94% agree financial markets are effectively regulated

  • 85% agree the FMA supports market integrity

  • 84% agree that FMA communications is relevant to their sector

  • 75% agree the FMA helps raise the standards of market conduct

  • 80% agree that communications help them understand the FMA’s approach to regulation

  • 77% agree communications help them understand the FMA’s expectations of them

  • 53% agree it’s easy doing business with the FMA

 

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Partners Life release claims statistics

Partners Life have released historical and current claims statistics.

Some interesting statistics have been released by Partners Life around claims. Since Partners Life launched in 2011:

  • Partners Life have paid out more than 70,000 claims worth more than $1.25 billion.

  • Their biggest monthly disability claim paid was for $1,617,691

  • The longest running claim paid for monthly disability cover was 4,068 days and the average claim length was 293 days

  • Partners Life paid 13,379 monthly disability cover claims totalling $225,954,755

  • Their biggest life cover claim paid was for $2,964,706

  • Partners Life paid 1422 life cover claims totalling $334,281,111

  • Partners Life paid 51,827 private medical cover claims totalling $353,468,683

  • Their biggest private medical cover claim paid was for $982,800

  • Partners Life paid 3,948 trauma cover claims totalling $357,357,574

  • Their biggest trauma cover claim paid was for $3,218,899

For the year ended 31 March 2024, Partners Life

  • paid 93% of claims

  • paid $51,020,381 of monthly disability cover claims cost across 3,332 claims paid

  • paid $61,130,350 of life cover claims across 208 claims paid

  • paid $71,705,905 of private medical cover claims across 12,891 claims paid

  • paid $66,106,600 of trauma cover claims across 655 claims paid

 

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