| Log In Subscribe for $0.99/week
Jenny Ruth
Jenny Ruth
3
3 Comment
Save Story
Insurance

OnePath's new business declines, Sovereign's surges

Monday 5th of March 2012

The ANZ Bank-owned OnePath's new business in the individual term, trauma, replacement income and lump sum disablement product categories fell to $5.6 million in the three months ended December, or 13.7% of total new business in the quarter.

That's down from the $6.7 million it collected in the September quarter, 14.8% of the total, and $8.5 million, or 20.2% of the total, in the December quarter of 2010. It's also OnePath's weakest quarter since June 2010.

The figures cover only those companies which are members of the Insurance Savings and Insurance Industry Association (ISI) and account for about 80% of the insurance industry, according to chief executive Peter Neilson.

OnePath is still bringing in the second highest amount of new business but less than half that of Sovereign which collected $12.4 million in the December quarter, or 30.1% of the total.

Sovereign's share of new business in the September quarter was 26.4% and was only 24.3% in the December quarter of 2010.

AMP, which now includes AXA, attracted the third highest share of new business at 11.3%, up from 10.6% in the September quarter and 8.9% in the December 2010 quarter although the actual amount collected fell to $4.65 million from $4.76 million in the September quarter.

AIA had a strong December quarter, increasing its share of new business to 9.2% from 7.4% in the September quarter, while Fidelity had a rather weak one, its share dropping to 7.8% compared with 10.7% in the September quarter.

Tower's December quarter was also weak, its share of new business falling to 4.4% from 6.9% in the September quarter and the actual amounts it collected falling to $1.8 million from $3.1 million. Cigna had a strong December quarter, its share rising to 3.1% from 2.7% in September.

OnePath's surrender rate at 16.1% for calendar 2012 was the highest in the industry behind only Kiwibank's at 18.4% - Kiwibank's share of new business in the December quarter was just 1.4%, unchanged from the September quarter.

By contrast, Sovereign's surrender rate was well below the industry average of 11.1% for 2012 at 9.9%.

Comments (3)
Simon Rule
Ironic indeed that Peter Neilson and his chums at the ISI declined Partners Life membership of the association last year (remind me what the real reason was for this decision again?)and now Partners are incredibly successful and taking all this business off OnePath. Without the inclusion of Partners Life the above new business stats are misleading. Peter I suggest you go cap in hand to Naomi to see if she still wants to join your association. Not having the newest life insurance provider as a member is an embarrassment to you when it’s clear advisers are recognising the superior benefits of placing their clients with Partners for cover.
0 0
12 years ago
Phil East
Perhaps the public have not forgotten that onepath is only ING under a different label and know how they treat their customers when things go wrong.
0 0
12 years ago
Andy Phillipson
Forthright - I TOTALLY agree with you, you legend. Just like mortgage interest rates, at some point in time any idiot can prove any rate/policy is the best. However with policy wordings (just like interest rates) changing almost weekly, it is most important to look outside the square; look at Financial Stability and claims history. One only has to look at the recent AMI debacle. I know it is fire and general, but the principle is the same! Could your insurance company cope with a large spontaneous hit? Rather than chasing up-front commissions, we should be seeking a higher trail, with no up-front. This will mean a smaller client base is required to maintain the same income, meaning ease of reviews with integrity, and better service to our clients (those people who provide us with our lifestyles). Don't they deserve that? And Insurance companies could help by disbanding up-front commissions. But while the up-fronts are so high, I don't believe the companies can complain about churning!
0 0
12 years ago
Comments to GoodReturns.co.nz go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved.
Next Article
nib experiencing extraordinary claims growth
nib experiencing extraordinary claims growth
2 min read
What’s the solution to life insurance advice risk anxiety?
What’s the solution to life insurance advice risk anxiety?
5 min read
Latest News
The run of play is towards more and more underwriting, and not just at the traditional new business stage
The run of play is towards more and more underwriting, and not just at the traditional new business stage
3 min read
Value of index tracking seen in the numbers, says Kernel
Value of index tracking seen in the numbers, says Kernel
3 min read
NZ sharemarket starts week up 0.6%
NZ sharemarket starts week up 0.6%
4 min read
Can Games Teach Financial Literacy?
Can Games Teach Financial Literacy?
4 min read
Insurance
More Read
Fidelity lays out bold new growth plans
Fidelity lays out bold new growth plans
2 min read
AIA Wellbeing Survey: Putting on your own oxygen mask first
AIA Wellbeing Survey: Putting on your own oxygen mask first
5 min read
Life advisers need to actively review legacy policies
Life advisers need to actively review legacy policies
3 min read
FANZ: all life insurance contracts should be consumer contracts
FANZ: all life insurance contracts should be consumer contracts
3 min read
Latest Comments
New customers locked out of ASB’s pre-approvals
As much as I disapprove of the ASB stance, I totally understand it, ESPECIALLY as the ComCom expect us to put an application to 4-5 banks, and not just the one we believe to suit the client the best. By demanding this, we would be tying the banks up with 4-5 times the applications necessary to secure a settlement. Banks would know that only 20-25% of applications are going to make it through to settlement. This shotgun approach is why banks are overloaded.
2 months ago Andy Phillipson
New customers locked out of ASB’s pre-approvals
This is pure BS from the major banks. In front of ComCom earlier in the year they denied any policy of channel inequality yet there clearly is from some (at board level) both in turnaround times and cashbacks for example. They need to staff up, sort their antiquated IT and give Advisers the respect they deserve. New Zealand borrowers are voting with their feet and using Advisers more and more. Are some banks starting their pushback? One as done it before so no surprise there.
2 months ago Jeff Royle
New customers locked out of ASB’s pre-approvals
As a financial adviser, business owner and ex-banker/home lender in NZ & Australia with almost 20 years experience I can tell you that this is very concerning for several reasons - first one being that as bank staff you still get paid regardless of whether you put the approval thru, lazy/incompetent/time poor bankers are often declining loans rather than taking the time to push a difficult deal thru as they get paid either way, as a financial adviser who doesn't get paid unless the deal settles we are more committed to securing an approval which is why more volume now comes thru the broker channels. This feels like it's the banks way of reducing costs by not having to pay brokerage to advisers when bank lenders doing nothing should be sitting on the broker overflow lines. This directly affects small businesses and is another example of banks playing God & redirecting profit margins back to their own coffers - there is no valid excuse for branch lenders doing nothing to not be sitting on these overflow lines. It makes a mockery of giving the choice back to the clients who are already typically having poor banking experiences when dealing direct with bank staff.l and in no way supports small businesses already doing it tough.
2 months ago Natasha Viliamu
New customers locked out of ASB’s pre-approvals
Another major bank today has announced no pre approvals via Advisers for under 80% LVR. That's at least 3 of them. All applications whether direct or through Advisers should be given the same priority and go through the same assessment process. Banks don't appear to have invested (enough) in staff or technology and given how much money they make, it is unacceptable. Lets hope it gets sorted soon!
2 months ago Craig Pope
New customers locked out of ASB’s pre-approvals
Sorry I don’t believe ASB are overrun with applications as we are traditional in a slow market so I think this” high volume “ excuse is rubbish, ASB will still post a massive profit due margins being so high but they can’t hire extra staff?? This is a disgrace! for consumers that choose to go through an independent mortgage adviser ASB are turning them away, but an ASB branch can write that deal no problem? , what happened to offering choice to the consumer? And being competitive? Are Comcom silent on this? Are the dealer groups /master FAP’s who have a monopoly over mortgage advisers’ access to bank mortgage lending silent on this? Why do we pay dealer groups /Master FAPs thousands in fees and costs if they can’t or don’t want to even back the people that pay their wages. All mortgage advisers want is an even playing field no more no less. How would ASB feel if all mortgage advisers in NZ stopped sending business to them for a few months?
2 months ago Valkyrie Vulcan