{"id":85,"date":"2016-09-16T06:54:18","date_gmt":"2016-09-15T20:54:18","guid":{"rendered":"http:\/\/magazine.riskinfo.com.au\/27\/?p=85"},"modified":"2018-02-09T13:12:36","modified_gmt":"2018-02-09T03:12:36","slug":"aia-australia-industry-round-table-august-2016","status":"publish","type":"post","link":"http:\/\/magazine.riskinfo.com.au\/27\/aia-australia-industry-round-table-august-2016\/","title":{"rendered":"AIA Australia Industry Round Table"},"content":{"rendered":"
\n

Advisers, licensees and life company colleagues sat down to discuss how Australia\u2019s life insurance industry is evolving, particularly in relation to the area of health and wellness and how advisers and life companies are seeking to add value for the consumer, both now and into the future\u2026<\/h3>\n<\/div>\n

Panelists<\/b><\/p>\n

\"\"<\/p>\n

Pina Sciarrone<\/b>\u00a0\u2013 Chief Retail Insurance Officer, AIA Australia, Co-host<\/div>

\"\"<\/p>\n

Nick Hatherly \u2013<\/b>\u00a0Licensee voice, MD and Adviser, Australian Financial Risk Management<\/div>

\"\"<\/p>\n

Scott Dawkins<\/b>\u00a0\u2013 Adviser voice, Griffin Financial Services<\/div>

\"\"<\/p>\n

Dianna Pecherczyk<\/b> \u2013\u00a0Adviser\u00a0 voice, Diamond Blue Financial Services<\/div>

\"\"<\/p>\n

Jeff Thurecht \u2013\u00a0<\/b>Adviser voice, Evalesco Financial Services<\/div>

\"\"<\/p>\n

Jade Burford \u2013<\/b> Adviser voice, Advocate Private Wealth<\/div>

<\/div><\/div>\n

Table of contents\u00a0<\/strong>(Click these links to move directly to those topics)<\/p>\n

    \n
  1. Health and wellness philosophy<\/a><\/li>\n
  2. Health and wellness as part of the advice process<\/a><\/li>\n
  3. Integrating health and wellness into an advice business<\/a><\/li>\n
  4. The benefits<\/a><\/li>\n
  5. Consumer perceptions<\/a><\/li>\n
  6. The evolving role of the risk focused adviser \u2013 opposing views<\/a><\/li>\n
  7. Ongoing viability of risk-focused advice practices<\/a><\/li>\n
  8. Shared value<\/a><\/li>\n
  9. Final words<\/a><\/li>\n<\/ol>\n
    \n

    Health and wellness philosophy – Back to top<\/a><\/span><\/h3>\n

    The panel initially discussed the area of health and wellness and where this topic sits within the broader advice process. It discussed what role can and should be played by insurers, licensees and advisers in enabling these conversations, and whether this was the general direction in which the industry is, or should be heading.<\/p>\n

    AIA Australia\u2019s Chief Retail Insurance Officer, Pina Sciarrone<\/b>, told the panel she passionately believes that incorporating health and wellness with insurance solutions is indeed where the industry is heading, and that more life insurers should be adopting this approach within the services they offer.<\/p>\n

    Once the program is in place, Pina said insurers should also be providing the education for advisers to complement the program itself. \u201cWe introduced AIA Vitality about two and a half years ago and probably the biggest hurdle for advisers has been working through how to actually bring health and wellness into the conversation with their clients, as well as ensuring they understand the nature of the proposition and its true benefits.<\/p>\n

    <\/div>\n

    \u201cI think the misconception in the mind of advisers and some consumers is that it\u2019s just a discount program,\u201d said Pina. She said the key element that differentiated Vitality from other health and wellness programs is that it changes behaviours. \u201cVitality is about educating an individual about their health status and the need to take action to address it. When I began the program I was personally alarmed to learn that my Vitality age, which is calculated based on my health status, was five years older than my actual age,\u201d she said. \u201cThe program provides tools and education around how to address any health issues and it takes you on that journey.<\/p>\n

    Pina told her peers that behavioural economics studies have found that for people to actually change their behaviour, they need to be \u2018nudged\u2019. \u201cThey need incentives and Vitality gives them the nudges and incentives they need. Vitality produces changes in behaviour and hence long-lasting positive effects on your life and lifestyle.\u201d<\/p>\n

    we need to wake up and understand that we\u2019ve got a problem here<\/p><\/blockquote>\n

    \u201cAs insurers, we\u2019re seeing an increasing trend in receiving claims from largely preventable diseases, which are due to lifestyle choices around exercise, nutrition, smoking and drinking habits. Those choices are leading to four main types of preventable, non-communicable diseases, which is leading to 90% of deaths in Australia. That\u2019s crazy,\u201d said Pina, who added that something must be done about educating people and changing behaviours around lifestyle choices to reduce that percentage of preventable deaths quite drastically: \u201c\u2026we need to wake up and understand that we\u2019ve got a problem here. Two in three Australians \u2026are obese. Our kids are becoming obese. We know the annual cost to our health care system of obesity, smoking and harmful drinking is six billion dollars. We\u2019ve got a real issue here.\u201d<\/p>\n

    Pina was queried on whether advocating for other insurers to implement similar comprehensive health and wellness programs would reduce the differentiating nature of AIA Australia\u2019s own offer. She agreed this could be the case, but said she believes in \u2018abundance\u2019 and in the concept of the rising tide that lifts all boats. \u201cIf we\u2019ve got more people promoting this message then we\u2019ve got more individuals that are going to adopt health and wellness programs. We reach that tipping point where health and wellness becomes an important issue for both the consumer and for the Government \u2013 for everyone in the industry. Through this awareness and programs like Vitality, we can begin the process of becoming the healthiest nation in the world.\u201d<\/p>\n

    \"\"<\/p>\n

    Health and wellness as part of the advice process – Back to top<\/a><\/span><\/h3>\n

    Nick Hatherly<\/b> is Managing Director of established risk-focused firm, Australian Financial Risk Management<\/a>. While agreeing that AIA\u2019s<\/p>\n

    Vitality and other health and wellness programs were positive for the industry, he spoke to the panel about where these programs fit within the current advice process. \u201cI think Vitality is a fabulous proposition. However I don\u2019t know whose responsibility it is \u2013 whose job it is to roll that \u2018product\u2019 out to the market place. Is it the job of the licensee to educate people as to the value of health and wellness? I\u2019ve taken the stance that it isn\u2019t my job as a licensee to do that. That doesn\u2019t mean I\u2019m against it. I don\u2019t think it\u2019s my role as a licensee or as an adviser to build the market for this product\/service.\u201d<\/p>\n

    Nick told the panel he understands the health and wellbeing conversation has been quite a topic in South Africa for some time. \u201cBut I can\u2019t see any value in my business to run with this proposition.\u201d<\/p>\n

    Questioned about the role that advisers within AFRM play in disseminating the broader health and wellness message to their clients and prospective clients, Nick said it depends on the individual adviser\u2019s market.<\/p>\n

    <\/div>\n

    Pina suggested to Nick that \u201c\u2026if you\u2019re in the business of protecting people\u2019s lives and managing risk, why wouldn\u2019t you extend that to health and wellness?\u201d Nick responded that he\u2019s not saying \u2018no\u2019 to the proposition, but that it\u2019s not top consideration for him as the head of a risk-focused licensee business.<\/p>\n

    He said his major priorities lay with others parts of the advice process. \u201cLet\u2019s get the product right. Let\u2019s get the definitions right, and the structures and the tax outcomes\u201d he said. \u201cAnd if all that is good, then when we go to claim, my clients won\u2019t be talking to me about the fact they\u2019ve done this \u2018health and wellness\u2019 thing. They want to know they\u2019re going to get paid once they\u2019ve had their heart attack and that the contract is actually going to do its intended job first and foremost. Then, if we can engage with insurers with these schemes and get a better outcome for the client, that\u2019s great. But I don\u2019t think that\u2019s first priority for my business.\u201d<\/p>\n

    Nick continued, \u201cWe already have great conversations with our clients without the health and wellness component. It\u2019s certainly something that can be introduced into the discussion. We\u2019re also introducing new topics and subjects. But essentially, insurance is a funding mechanism to address a problem and we have to take people there.\u201d<\/p>\n

    Pina detailed the benefits to advice businesses in embracing health and wellness programs, which included:<\/p>\n