MLC’s Japanese owner commits to IFA sector

Nippon Life senior managing director Hiroyuki Nishi has told delegates to the AIOFP conference in Japan that the 120-year old life company’s board has high hopes for its first foray into the Australian market.

“We intend MLC Life Insurance to be number one in the market, sooner or later,” Mr Nishi said at a briefing at Nippon Life’s Tokyo headquarters. “We cannot do this without your support.”

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Speaking to ifa on the sidelines of the conference, MLC chief operating officer Sean McCormack said the IFA channel will be an important component of the strategy to comply with the parent company’s projections.

“Nishi-san has very high expectations and wants us to be number one. He says we should ‘not hurry, but be quick’,” Mr McCormack said.

“So for us that means we need to grow strongly across all current market segments and unlock new opportunities as well. We are hoping to grow really strongly in retail advice, this is a really important channel for us going forward.

“The fact is that we cant get to number one in the Australian market without the support of IFAs – it is too important a channel. Millions of Australians simply aren’t going to wake up over the next five years and proactively purchase life insurance – they need advice and advice will get them the best outcome when it comes to insurance design.”

MLC Life Insurance will be undergoing a $300 million revamp of its technology systems as it moves off NAB’s architecture, Mr McCormack revealed – a move he said will have particular benefits for its adviser segment.

“The investment that’s coming through is designed to provide greater digital functionality,” he said.

“That will help one of the pain points for advisers. With LIF reforms they need to become more efficient, and we will be digitising processes which will allow them to do business with us much more easily.”

Mr McCormack said he intends to see more Japanese insurers enter the Australian market as banks divest the sector, spurred on by low population growth and domestic returns in Japan.

It was announced Nippon Life would acquire an 80 per cent stake in MLC Life Insurance in October 2015, in what was the Japanese firm’s first majority position in an overseas company. NAB retains a 20 per cent stake in MLC Life Insurance.