Risk Product, Company and Regulatory Updates as at 20 August 2019

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Product Updates

OnePath OneView Life update

OnePath has announced a premium discount offer and enhancements to its product suite. As of 27 July 2019, OnePath is offering new policyholders a 10 per cent premium KickStart discount for OneCare and OneCare Super lump sum policies across the first year. The discount applies to OneCare Life Cover and linked total and permanent disability (TPD) and/or trauma insurance with stepped premiums. The discount applies to subsequent years as per the schedule. The KickStart discount offer is available until 31 January 2020.

Enhancements made to OnePath’s OneView Life applications and underwriting platform include:

  • The ability for advisers to produce quotes for cover increases online

  • New function to decline CPI increases without a client signature

  • Increased access to portfolio analytics via OneView Life portal

  • Initiatives in the pipeline for supporting advisers in nurturing client relationships, including a self-service portal where clients can update basic personal details

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Company Updates

AMP announces new strategy, revises agreement for sale of AMP Life

AMP’s new three-year transformation strategy includes the following moves:

  • Divest majority ownership in AMP Life

  • Revitalise the wealth management business in Australia

  • Further integrate AMP Bank products and services with wealth management

  • Update advice and superannuation offerings

A revision to the agreement has put the AMP Life sale to Resolution Life back on the table. The Reserve Bank of New Zealand held the sale up, and it wasn’t looking promising. The new agreement has updated terms that comply with RBNZ requirements for the sale.

CBA closing Financial Wisdom

Commonwealth Bank of Australia has started winding down Financial Wisdom, with the doors closing by June 2020. This decision was made after Count Financial was sold to Count Plus. Commonwealth Financial Planning Limited-Pathways advisers will transition to self-licensing or move to a different licensee.

MLC Wealth restructure

Major changes are afoot at MLC Wealth, says chief executive Geoff Lloyd, as the financial advice firm splits from NAB Group. Aligned dealer groups at MLC Wealth will be consolidated from five down to two as the financial advice business is restructured. The chosen two are Godfrey Pembroke and a combined group containing Garvan, Apogee and Meritum brands.

MLC Wealth will depart the self-employed franchise models of MLC Advice Stores and NAB Financial Planning, with a simpler pricing model to be introduced. There will be one advice support team to serve employed advisers and advice firms.

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Regulatory Updates

MBS Insurance and Complete Risk Analysis to merge

New South Wales risk advice company MBS Insurance is merging with Complete Risk Analysis to create one of the largest risk insurance businesses in the country with $55 million in premiums under management. Both firms run under the licence of Bombora Advice, and together will have 18 financial advisers and 40 administrative staff. Initially, the companies will operate under their own brands until a new company identity is developed.

APRA fines Westpac for reporting obligation breaches

Westpac and subsidiaries St George and Capital Finance Australia are to pay $1.5 million - the maximum for the infringements - after the companies failed to meet Australian Prudential Regulation Authority (APRA) reporting deadlines.

Westpac was 20 days late filing 31 March monthly reports, and St George and Capital Finance missed the deadline by up to 37 days. Additionally all three companies were 9-28 days late filing quarterly reports with APRA.

FASEA exam update

After the first exams were held and marked by the Financial Adviser Standards and Ethics Authority, financial advisers have had a mixed response, despite 90 per cent passing. Advisers were given a pass or fail, and no breakdown of what sections they didn’t do well in.

A number of fresh education credits and bridging courses have been approved:

  • Certified Investment Management Analyst (CIMA)

  • CFA Societies Australia

  • Queensland University of Technology