{"id":9,"date":"2016-09-15T13:52:29","date_gmt":"2016-09-15T03:52:29","guid":{"rendered":"http:\/\/magazine.riskinfo.com.au\/29\/?p=9"},"modified":"2017-04-20T14:09:35","modified_gmt":"2017-04-20T04:09:35","slug":"editorial","status":"publish","type":"post","link":"http:\/\/magazine.riskinfo.com.au\/29\/editorial\/","title":{"rendered":"Editorial"},"content":{"rendered":"
\"Editor

Managing Editor – Peter Sobels<\/p><\/div>\n

Risk-only Advisers \u2013 is the Clock Ticking?<\/b><\/p>\n

The time is fast approaching for many risk-only advisers to make some key decisions about the future direction of their advice businesses.<\/p>\n

While there appears to be growing evidence that more advisers are charging fees for delivering risk advice solutions, or at least for some elements of the risk advice process, what is less clear is the extent to which this trend applies to risk-only or risk-focused advisers.<\/p>\n

The point is constantly being made by advisers to Riskinfo that it is much easier for \u2018financial planners\u2019 or \u2018holistic\u2019 advisers to offset any future reduction in their life insurance commission income against the fees they may be able to apply to other elements of their advice services. They make the point that risk-only advice businesses don\u2019t have this \u2018luxury\u2019.<\/p>\n

Risk-focused adviser, Mark Rando, has explained how he charges fees for the Statements of Advice he provides and also how, in doing so, he\u2019s looking to recoup any financial shortfall that may come his way from the two-year clawback regime that will apply from 1 January next year.<\/p>\n

Other risk-only or risk-focused advisers are charging fees for the claims services they provide or are at least thinking about heading down this path. Others, however, say they will never charge a fee for claims services because their philosophy prevents them from doing so.<\/p>\n

Elsewhere, a growing number of advisers and advice businesses are embracing the health and wellbeing message into their business model and, in doing so, have broadened the range of areas in which they add value and for which they can reasonably charge a fee. These advisers are re-defining how they add value.<\/p>\n

There are risk-only advisers (and licensees) who have projected that their businesses will remain sufficiently successful and profitable at the reduced commission levels that will accompany the introduction of the Life Insurance Framework reforms. Theirs is a longer-game approach in which they\u2019ve said they will be able to manage the transition period until the ongoing 20% annual commissions will eventually deliver higher overall income and at the same time increase the value of their business by virtue of a higher (doubled) ongoing annual income stream.<\/p>\n

What seems obvious is that there is no single answer that will have meaning for all risk-only and risk-focused advisers.<\/p>\n

Their own peers are predicting that some advisers will depart the industry because they will find that their business model \u2013 their \u2018way of doing things\u2019, just won\u2019t work anymore and that they are or will be unable to adapt.<\/p>\n

There are some answers that are out there, as the life insurance industry experiences its greatest upheaval in generations. But for the pure risk-only and risk-focused adviser, who has probably been operating a successful and ethical business model, and who has been serving the best interests of their clients for many years before this requirement became a statute, there are fewer answers. For some, time is running out.<\/p>\n

\"sig-Peter-S\"<\/p>\n

Peter Sobels<\/p>\n

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We\u2019d like your feedback on our digital magazine format<\/h3>\n

Share your comments below or send us an email<\/a>.<\/p>\n<\/div>\n

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\"\"<\/a> Filling the Gaps in Consumer Satisfaction<\/a>New research finds consumer satisfaction with advisers and insurers has stayed strong despite the spate of negative media coverage but more could be done to keep consumers engaged…<\/span> Read More<\/a><\/span><\/div><\/div><\/div>\n<\/div>
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