Risk Product, Company and Regulatory Updates as at 9 July 2019
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Product Updates
NEOS Life enhances risk-only superannuation product
NEOS Life now validates the identity of a customer, then matches their superannuation account when they apply for life insurance via the NEOS Super Plan. This means a reduction in rollover rejections and faster completions within the NEOS Super Plan, a risk-only superannuation product that allows customers to pay for retail life insurance policies via their superannuation fund.
The NEOS platform delivers real-time data between the company, regulators, superannuation funds and the banking system.
AMP adds functionality to My AMP
New features of AMP’s online wealth management technology include:
Interactive timeline to identify goals and look up educational resources
New navigation design for simpler access to My AMP features
Access to AMP’s budgeting tool, Money Manager
New quick links area for commonly accessed areas like statements and paying bills
OnePath updates trauma definitions, underwriting engine
OnePath has reviewed over 25,000 trauma policies in a definitions overview, with over 600 trauma definition updates over 60 trauma products. Policies reviewed go back to 1988. Older policies tend to have broader coverage with more favourable definitions, which have been retained. The new definitions apply as of events from 1 December 2018.
Additionally, OnePath has made over 70 enhancements to its underwriting engine after feedback from advisers.
MLC Super changing TPD claim assessments for Any Occupation
Total and permanent disability (TPD) claims assessment for working members of MLC Super have changed. Members who have worked for 13 months prior to lodging a claim will be assessed to see if the person will ever work again under the Any Occupation definition.
Part of the new Any Occupation definition includes missing work due to injury or illness for a period of six consecutive months and undergoing regular medical treatment. Clients are no longer allowed to undertake any type of work that he or she is reasonably suited by way of education, training or experience.
If a member has not been working in the 13 months prior to lodging a claim, the claim will be assessed under the Normal Physical Domestic Activities criteria, which involves domestic activities such as cleaning, shopping, caring for dependents, and preparing meals. Casual, contract, those who work less than 15 hours per week, high risk occupations and those aged 65 and over and are still working will be affected by the changes.
Anyone in this category will have their TPD claims assessed under the Any Occupation definition, whereas prior to 1 July 2019, claimants were assessed under the Activities of Daily Living definition. Some members may see reductions in premiums as a result.
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Regulatory Updates
First FASEA exams completed, more courses approved
Almost 600 financial advisers have completed the June adviser exams that occurred around the country, put on by the Financial Adviser Standards and Ethics Authority (FASEA). The papers are still not graded and finalised fully, so the pass rate is not yet available.
The next set of exams is due to go ahead in September, with almost twice as many opportunities for advisers to sit the exam due to high demand. More regional exam centres are being scouted, which may mean even more opportunities will exist for advisers for the December exams. Remote access to the exam is also available upon request.
FASEA has approved education credits related to the Association of Financial Adviser’s (AFA’s) Fellow Chartered Financial Practitioner and Chartered Life Practitioner courses. Coursework will be recognised from the Self-managed Superannuation Fund Association as well. A maximum of two credits can be put towards a higher education requirement for an existing adviser who has completed one or more of the prescribed approved courses to obtain a professional designation.
APRA: financial institutions to register an ‘accountable person’ - consultation underway
The Australian Prudential Regulation Authority (APRA) has new rules in the pipeline for insurers and superannuation licensees to appoint an ‘accountable person’ for every Authorised Deposit-taking Institution (ADI). Banks received a formal letter recently, with the rest of the industry to be included in the new guidelines.
The purpose is to create accountability and product responsibility under the Banking Executive Accounting Regime, after the Royal Commission, creating end-to-end responsibility to improve customer experience and outcomes.
The accountable person will be identified and registered for each product that the institution offers, and applies to the entire chain - retail, business and institutional customers. The accountability includes the design, delivery and maintenance of the product, plus customer remediation, data quality, and links to technology systems, outsourcing and incentive arrangements. The products covered include white label and other-branded products.
APRA is calling for submissions on the proposed approach.
AWSM has AFSL cancelled
The Australian Securities and Investments Commission (ASIC) has cancelled the Australian financial services (AFS) licence of financial services provider, Australasia Wealth Services and Management (AWSM).
AWSM’s licence was suspended for failure to comply with its obligations, breaching financial reporting and audit obligations. The company directors also failed to enrol the company in the Australian Financial Complaints Authority (AFCA) scheme. AWSM was unable to meet its obligations due to its financial position.
