Advisers call for loyalty discounts on premiums

AIA chief retail insurance officer Pina Sciarrone told Risk Adviser this was a sentiment commonly expressed during a recent series of adviser forums which AIA has been holding around the country.

Many advisers have been calling for changes to premium costs for long-term clients, Ms Sciarrone said.

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“A lot of [these changes include] loyalty discounts or loyalty bonuses for clients,” she explained.

“[This would include] either a refund of premiums or an increase in the sum insured if they have stayed with [an insurer] for a period of time.”

Ms Sciarrone added that during the forums – which have been held in Sydney and Melbourne already, but are yet to be held in Australia’s other capital cities – AIA discussed future product ideas with advisers.

For example, the possibility of having products made up of both stepped and level premiums to assist with the affordability of insurance for clients was addressed, Ms Sciarrone said.

“When you look at the current product range, we tend to operate primarily on a stepped premium product range where a premium increases as the person gets older, [and this presents] an affordability issue.

“Some of the product ideas that we are talking about [include having] a fixed-term price type product where the price is actually fixed for a number of years,” she said.

“That [can] assist with clients from an affordability perspective [if they are] wanting to retain that insurance policy.”

Ms Sciarrone said that flagging these types of ideas with advisers generates discussion and allows AIA to gain an insight into whether the business is missing anything that could add value to advisers and help their clients.

“It was really about us, instead of trying to impose this as our agenda, we really just put some ideas in front of them and just to get their feedback which is kind of food for thought in terms of what we want to do from a product perspective,” she said.