Suncorp-owned insurer Asteron Life has implemented a new remuneration structure for financial advisers using its products, aimed at assisting them to move away from reliance on upfront commissions.
Having conducted research which indicates more than 80 per cent of business is “written on upfront commissions”, Asteron Life executive general manager, adviser distribution, Jordan Hawke said the model will assist advisers to “transition… to a business model that creates long-term value”.
Under the ‘2 for 10’ model, the insurer will offer an extra 10 per cent commission in the first year for advisers writing new business from November 2013.
“Asteron Life has long been talking about the structural issues affecting our industry and the need to look at all elements, including product structures, cost of acquisition and retention,” Mr Hawke said.
“’2 for 10’ is a step in supporting the future direction of our industry.”
Mr Hawke said the impetus for the new model was conversations with advisers who indentified issues with the "future of the industry" in terms of commission structures.
"While '2 for 10' may be seen as a short term tactical solution, it responds to the challenges given to me by advisers".
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