She said increasing regulatory scrutiny on the industry would bring changes to the way that advisers and insurers ran their businesses.

As part of the conduct and culture review, conducted by the Financial Markets Authority and Reserve Bank, she said, the insurer was challenged to prove it was doing right by clients.

“Prove that you haven't done bad things to your customers with no real guidance in terms of what that proof needed to look like or what would satisfy them. So, the biggest challenge of this conduct and culture work was really us asking ourselves, ‘how can we ... What are we looking for? How do we find it? And then how do we present it if we find it?’”

That had prompted Partners Life to think about how clients worked with advisers and the company, she said.

“We have trusted all of the pieces that lead to the client becoming ours and all of the pieces of servicing the client outside of just the policy.

“We trusted that that was happening because that's the adviser's space, and we've always felt that it's a conflict for an insurance company to be in the middle of an advice process.

“So, to hear regulators saying, ‘They're your customers. You've got to take responsibility for the quality of the advice that they receive’ was really, really challenging and scary for advisers.”

She said advisers would have to realise they did not own their clients. Life insurers had always had the contractual relationships with clients and would pay the money in a claim, she said.

The difference was now that the regulator expected the insurance firm to know that the client had not been given any inappropriate or incorrect advice to place the business with the insurer.

"The challenge for us is how do we do that when we don't have any relationship with the client, and nor should we until the very end of when they actually apply to us once the product provider decision's been made at the end of the process?

“We’ve been doing some work in terms of understanding once we have a client, how do we backtrack to check that they went through a proper advice process.

"Not was the advice correct, but was there a process? Do they understand underwriting? Do they fully understand the requirement to disclose? Was it replacement business, and did they go through a process to identify the benefits in the gate? So, how do we do that without actually getting involved in, and was it right to advise them to sell our product or someone else's product or this amount of the product?

"Because we're not there, and that's not information about the client that is ours to know. But we should check that there has at least been advice provided for the commission that we're paying for that advice and that the risks have been mitigated for the client making the decisions that they're made as best as we can. So, that's one part of it, which means we are going to be in a conversation with clients about the advice."

Advisers would also have an obligation to service clients, in return for ongoing commission, she said.

“I've been saying to advisers you can't have certainty that the regulations around who owns the commission, the renewal commission, is not going to change. Because the rhetoric around it is certainly saying, ‘Prove that you deserve it. You don't just get it because.’ So, it's changed from a deferral of the upfront commission to a service commission conversation.”