An email from CommInsure executive Olivia Sarah-Le Lacheur to the life company’s stakeholders on 16 June, seen by Risk Adviser, explained that a number of changes to the distribution operation were imminent.
“In response to the changing market conditions and our intentions for the customer and adviser offers, CommInsure is making changes to its retail advice distribution team,” Ms Sarah-Le Lacheur wrote.
“In making this decision, I want to assure you that CommInsure remains committed to you and your advisers.”
Ms Sarah-Le Lacheur stressed that state-based leadership and national account management roles would not be impacted, but that advisers and licensees in NSW and Victoria may “experience a change in which dedicated BDMs service them”.
Risk Adviser sister title ifa has reported that the changes are expected to result in redundancies and exits from the group, with as many as 40 CBA staff members affected.
A Commonwealth Bank spokesperson confirmed that a number of “small changes” to the life insurance business have been made, citing a “competitive insurance market” as a driving factor.
I’ve not been contacted by a CommInsure BDM simply because I have not used them, I would add – solely in the best interests of my clients. All vertically integrated life office entities didn’t just sit on the fence [like most other life offices], they gleefully rubbed their hands together thinking LIF would deliver the kingdom to them. I shall continue to give CommInsure a wide berth. Fortunately not an issue, as their pricing and overall product offer simply does not match most in the market.
As soon as Mr Trowbridge came along with his FSC axe, and the AFA caved in to the first bit of political muscle, I started asking BDM’s what they would do under what became known as LIF.
Almost all BDMs seemed incapable of accepting that less risk commission begat less risk advisers, which then resulted in less new business to their insurer employers.
None of them seemed to contemplate that if advisers were booted out of the industry, BDM’s and sales executives would go with them.
None seemed to grasp that if advisers were forced after a few years to charge advice and implementation fees, and take nil or very low commission, there was a distinct possibility that commodity life risk coverage such as term insurance could be reviewed and moved every year, in the client’s best interests, and that would severely impact on the profitability of their particular insurer.
Across the industry, I have little regard for the value to me as an adviser from today’s BDM’s, with one or two exceptions. Most are a waste of space: rarely will they take ownership of an adviser’s problem, and volunteer to personally take the problem to the appropriate decision maker, and then follow it through.
No longer do they pass on back to their masters the views of ordinary advisers about their employers products and services it is empoers clothes stuff. I believe very few of them reported back to a meaningful level of management the anger and feeling of betrayal amongst advisers at the proposals under LIF.
Comminsure are just the first to go public, but companies like Asteron & ANZ Wealth have been downsizing for some time, with commensurate decline in service levels.
What goes around comes around. C’est la vie !
You would not want to be a BDM with any of the companies post LIF, they will be the first to go when business plummets as it will. It will be admin and underwriters next but you can bet the fat cat execs who caused this disaster will be the last to have their salaries reduced.
Truth be known, CBA has lost so much business from groups and unions that it is hemorrhaging and has reassessed its position in the marketplace. Losing market share it is time to prune deadwood and hangers-on. Trouble is they should be hacking at the trunk as well as the branches.
Their wounds will be opened up for all to see and don’t be surprised if the others follow suit. It only takes one to start to tumble and the rest will fall into line. The management will say they have taken appropriate action to fix the problem – all while the Titanic continues to submerge!
“Of course I will respect you in the morning” Tell us another one!
Watch as a few more insurers start cutting back BDM’s. They know they have succeeded in their attempt to wipe out IFA’s, now they just need to cease serving whoever is left. Comminsure’s care factor for anything other than profit is on show again.
I think that CommInsure “reducing BDM numbers” is an appropriate business response to the effects of the LIF. Since the day the LIF was proposed our Industry was in trouble and even “blind Freedy” can see that the Industry is in “free fall”. The LIF will eventually catch up with those that were responsible for it’s implementation. In other words there will be significant job loses in Life Offices and even some Parliamentarians involved
(as we have been told) will struggle to retain their seats in Federal Parliament. All I can say is that it’s a sad day that such all ill conceived reform was allowed to even see the light of day. What were those famous words “To better align the interests of all parties”. With still 6 months before implementation how is it looking now Life Offices?
haha give us a spell. I have an number of Comminsure polices on my book from a previous register purcahase and have never had a BDM contact me since commencing business.