MetLife takes new approach to client claim support

MetLife Australia has worked with a workplace mental health specialist to pilot a new program aimed at providing enhanced support to clients navigating a claim.

Partnering with SuperFriend, the program uses a person-centred communication approach (also known as ‘motivational interviewing’), which has delivered improved outcomes internationally for both customers and the claims management teams supporting them, according to a statement.

In a claims situation, person-centred communication means the claims assessor partners with the person on claim to understand their unique situation and collaborate to resolve the claim and help the person back to health, MetLife said.

It said the program’s techniques equip the claims manager and the person on claim to develop personalised goals for optimal outcomes and an improved quality of life.

SuperFriend developed the tailored program for Australian insurers and claims managers, incorporating research from its extensive industry partnerships.

“Making a claim can be a really challenging and daunting experience and is the last thing many people feel like doing when they’re unwell or injured,” said SuperFriend chief executive Margo Lydon.

“This approach is designed to make the process a lot ’human’ by empowering the person claiming and equipping the claims manager with a broader range of skills for enhanced engagement.”

MetLife head of health Mark Raberger said claim time is an opportunity for insurers to show what it means by caring.

“We’ve been working with SuperFriend for many years now to deliver the best possible experience for our customers and support our claims assessors who play a critical role in that process,” Mr Raberger said.

“It speaks volumes that SuperFriend have chosen to partner with us for this pilot – it’s exciting to be part of refining an approach to deliver best practice claims management.”

The pilot commenced in August and will conclude in early 2020. Following the pilot, SuperFriend plans to roll out the program to other insurers.

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Wealth giant IOOF launches budgeting app

ASX-listed wealth manager IOOF has partnered with MoneySoft to launch a goal-based budgeting app.

The new app is called fincentral and allows users to track multiple bank, mortgage, investment and superannuation accounts to know their financial position.

IOOF is partnering with top Australian software provider Moneysoft to make fincentral available to clients through its network of 1500 advisers.

“People struggle to manage their money properly if they don’t understand their cash flow,” IOOF head of advice systems and technology, Umesh Banga, said.

“Financial advisers need to be across this, too, so they can give their clients advice and help them build a long-term wealth creation strategy.”

Mr Banga said unlike similar apps, internet banking credentials remain encrypted on the user’s own device and is not shared with third parties.

Moneysoft CEO Jon Shaw said his company’s vision was to provide a flexible, cloud-based technology platform that enables our customers to differentiate in terms of the experience they provide to their clients.

“We wanted to provide an enterprise-grade solution that met customer needs while being delivered with the flair and simplicity of a start-up,” he said.

“Consumers want a financial advice experience that provides the type of service they value most highly, while also meeting their expectations on security, privacy and convenience.

“Moneysoft technology has been designed to do that from the get-go. We’re both humbled and proud to successfully deliver this innovative system as IOOF’s technology partner of choice.”

Mr Shaw said research shows that Australians’ financial consciousness is dropping to dangerously low levels. A 2019 study by University of Melbourne found that 85 per cent of Australians are having trouble or just coping with their financial wellbeing.

Research by ASIC into what consumers thinks about financial advice showed that while 27 per cent of Australians had received financial advice in the past, fewer than half had done so in the last 12 months.

Almost eight-in-ten people agreed that financial advisers have expertise that they lack.

“The system that IOOF and Moneysoft have delivered addresses this – it gives people information and allows financial advisers to help them budget and manage their cash flow cost-effectively,” Mr Shaw said.

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Westpac and FeeSynergy invest in accountants

Westpac today announced it has become the first major Australian bank to offer a fully integrated payment solution designed for the accounting profession.

The offering sees Westpac join forces with FeeSynergy, a provider of automated debtor management and fee finance solutions, to help Westpac’s customers in the accounting sector reduce debtor days by facilitating payments via an online solution.

Paul Goessler, Westpac’s national head of professional services, said that while all accounting firms have a practice management system, many do not have a dedicated debtor collection solution, and this offering will help customers solve a major pain-point around debtor management.

“Our joint offering with FeeSynergy aims to help our professional services clients get paid on time. Taking steps such as implementing online payment systems can transform a firm’s cash position, enabling investment into new technology, new divisions, and tuck-in acquisitions. It also frees up capacity to fulfil increasingly tech-savvy customer expectations, who are seeking swift, seamless, personalised services.”

Mr Goessler said the FeeSynergy debtor management offering can be integrated into accounting firms’ existing systems to help automate cash collection, establish recurring direct debits and facilitate online payments 24/7. Money flows from the client directly to the accountant’s bank account without a third-party handling the funds.

Malcolm Ebb, co-founder and managing director of FeeSynergy, says many accounting firms struggle to ensure they get paid for their services in a timely fashion, with average debtor days across the industry between 65 and 90 days.

“The implementation of our automated debtor management platform has enabled client firms to dramatically reduce their average debtor days to below 30 days. For a firm with annual revenue of $5 million, this equates to a free cash improvement of upwards of $800,000, freeing up capital instead of it being tied up in debtors.

“Our combined offering with Westpac provides an easy-to-use, fully integrated and secure online payment gateway, which is a key feature of the platform. A large percentage of transactions made on this gateway occur after hours, demonstrating the preference of small business owners to pay invoices at a time that’s most convenient to them. Providing this sort of service not only reduces debtor days, but takes the task of chasing debtors away from partners.”

The announcement coincides with Westpac’s latest Smart Industry Report: Professional Services, which explores how nimble, tech-powered entrants into professional services are challenging the status quo, as competition for traditional revenue streams intensifies.

The report found professional services firms need to adapt their advisory services and pricing models to suit customer demands, while capitalising on emerging technologies to deliver services with greater speed and efficiency if they are going to stay relevant in 2030.

With the professional services industry employing around 20 per cent of the Australian workforce and generating annual revenue of over $165 billion[i], it is a critical sector of the economy. However, hyper-connected consumers are demanding new forms of service, and technologies such as AI, machine learning, data analytics and blockchain are disrupting business models while presenting opportunities for transformation.

According to the report, partnerships are emerging between traditional organisations and start-ups – ‘the incumbents and disruptors’ – to foster innovation and promote operational agility. Technology is also promoting greater collaboration with clients, resulting in fast, seamless and more valuable services.

“We regularly work with practice management software providers to enhance functionality for mutual clients. Through arrangements with organisations such as FeeSynergy, we’re helping our customers look beyond overdraft limits for the management of cashflow, by delivering working capital solutions that provide flexibility for new strategies and change management,” Mr Goessler concluded.

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Simpler SOAs can fix advice: software provider

Advice can be made more affordable through simpler statements of advice and the creation of separate SMSF adviser profession with its own compliance requirements, says one advice software provider.

BGL managing director Ron Lesh told Adviser Innovation sister publication SMSF Adviser that the SOA process needed an overhaul to make investment advice affordable and appealing for SMSF trustees, given that 80 per cent of self-managed funds currently did not use a financial planner.

“The research we’ve done about that is that the whole SOA process, having to produce a 40-page document and pay $3,000 or $4,000, is ridiculous – it should be a two-page document,” he said.

“We have to come up with a short form SOA that can be used not just for SMSFs but generally.”

Mr Lesh added that rather than sitting under the ASIC licensing regime, the government should consider developing a separate SMSF adviser profession with its own training requirements, regulated by the TPB.

He also added that Chartered Accountants Australia and New Zealand and CPA Australia had been wrong in their submissions to Treasury that returning the accountant’s exemption would not be enough to address unmet advice needs among SMSF trustees.

“What they should have done is said we support what’s being proposed and we would also like to see the following, but instead they have said we don’t support it at all,” Mr Lesh said.

“They haven’t asked members, and that is what I see is the problem; ask any member in a small firm whether the exemption should come back and the answer would have been yes. 

“It’s not going to solve the whole problem, but it’s certainly an improvement on what we’ve got – you’ve got to start somewhere.”

Mr Lesh said the willingness of Treasury and regulators to consider a return of the exemption indicated an industry-wide acceptance that the current regime wasn’t functioning as it should, and that further steps should also be taken to improve quality and access to SMSF advice.

“Every time ASIC does its shadow shopping, it finds SMSF advice is crap, and accountants agree it is not working,” he said.

“ASIC has not come out and jumped up and down and said [returning the exemption] is a bad idea, and they would have if they didn’t think it was, so their view is clearly that SMSF advice isn’t working.

“The way I look at it is the first stage is getting the exemption back and allowing accountants to talk about what they should be talking about, and once we’ve done that, we need to get trustees better investment advice.”

BGL is supporting a return of the accountants’ exemption through encouraging its users to sign a petition started by the Institute of Public Accountants which Mr Lesh said now had around 1,000 signatures.

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Integrity Life consults advisers on new discount offer

Australian life insurer Integrity Life has launched a lifetime discount offer that it says strongly aligns with the best interests of advisers and consumers.

Integrity has announced an 8 per cent discount for the lifetime of a policy across its lump sum products (life, critical illness and TPD). It said the move is designed to ensure sustainable pricing for its life insurance products.

It said the decision to only provide discounts on lump sum products is aligned with regulator and industry concerns about the sustainability of income protection. The offer is also on the standard premium each year for the life of the policy.

Integrity Life managing director Chris Powell said the Hayne royal commission highlighted that the customer’s interests must come first, and products must be appropriate to their needs.

“This simple principle is something that businesses such as ours are seeking to address, and to play a valuable role in the evolution of our industry towards this mindset,” Mr Powell said.

“As an insurer with a completely blank canvas, we are in the fortunate position of being able to play a role in building a more sustainable life insurance industry. When thinking about the best way to price our products, we made the deliberate decision to ensure they are all priced individually and sustainably.

“We believe this transparency in pricing will help advisers build trust and loyalty with their clients.”

Mr Powell said current discounts, particularly upfront short-term discounts on income protection, are unsustainable and are contributing to ongoing losses among insurers.

“Because of the importance of income protection as a lead component of ‘packages’ it is always tempting to price it as a ‘loss leader’. However, pricing in this way does not align with Integrity’s philosophy of promoting ongoing sustainable pricing, nor does it benefit the insurer, the adviser or the customer in the long run,” Mr Powell said.

“We trust that our adviser partners will be excited by this new proposition and the broader changes it represents for the life insurance industry.”

The offer is valid for new business quoted and submitted from 15 September 2019 to 31 December 2019. Applications must be inclusive of two or more different covers, with the discount applied to lump sum covers (life, critical illness or TPD) only.

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FinClear launches HIN-based securities lending platform

Australian wealth management technology provider FinClear has launched the first HIN-based securities borrowing and lending platform.

Securities borrowing and lending in Australia has previously been the domain of investment banks, who hold portfolios of stocks to lend to institutions to service clients who want to undertake strategies including hedging, derivatives trading and short selling.

FinClear’s model allows wholesale holders of equities to lend directly to other wholesale investors, bypassing traditional cost barriers of the custody model and opening the market up to more participants, as well as a much wider universe of stocks.

“FinClear is essentially acting as a bridge between those who own the securities and those who want to borrow them on a HIN-based platform,” FinClear head of equity finance, Alev Dover, said.

“This opens up two important strategies to the Australian investment community. Firstly, wholesale investors can put their investments to work – rather than just holding what would be considered dormant stocks, they can earn revenue from them by lending them out, while still implementing their fundamental long strategies. Secondly, smaller institutions who have been locked out of the exclusive investment banking ‘club’ either by price or just their size, are able to borrow stock to execute more sophisticated strategies.”

The platform also brings a new universe of equities to the table, adding an additional alternative to increase liquidity and price discovery for the market, Ms Dover said.

“Because we avoid the ‘carry cost’, our model is much more efficient and cost-effective,” she said. “It allows borrowers to find illiquid and difficult to access securities that the investment banks are unlikely to hold.”

The new model is made possible by FinClear’s HIN platform, which allows investors to maintain their investments on their own Holder Identification Number instead of adding their holdings to a ‘pool’ inside a wrap platform or other custodial managed investment.

The FinClear model, which has gained traction quickly since it was launched in 2018, has captured over $5 billion in direct holdings via wholesale providers including stockbrokers, financial advisers, small-to-medium super funds and institutions.

FinClear’s securities lending model is bound by the same laws and regulations as the traditional custodial model, but has the benefit of being much more transparent, said Ms Dover.

“The world’s biggest institutions, including state governments and largest super funds, are some of the most significant lenders for these types of strategies, operating in an extremely tightly and well-regulated market,” she said.

“Our model operates in the same environment but lowers counterparty risk, and creates a more open playing field for Australian wholesale and sophisticated investors.”

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