Dealer brings risk research in-house
In a sign that not all risk advisers are satisfied with the suitability of recommendations coming from research houses, a major Australian dealer group has decided to move its risk research in-house.
And instead of basing that in-house research on traditional evaluators of product suitability, like price and definitions, Genesys Wealth Advisers will attempt to align risk products with, what it believes, are more appropriate client categories.
Genesys risk adviser Col Fullager said the categories would be based on product complexity.
“Some people want a product with all the bells and whistles and some people just want basic cover.”
The categories include a split between comprehensive and basic contract, another between indemnity and agreed value, and a category for people who are in high risk occupations.
“Back in the 90s contracts became generosity based, so everyone assumed that if your contract was more generous you’d have fewer offsets, the contract would be more liberal, so it was better for the punter.
“But because the definitions are too liberal you get a lot of rat bags making false claims that everyone has to pay for. And also, why would you want a definition that is extremely liberal if you don’t need it?”
Fullager said the new system would also make it easier for advisers to understand the process behind their recommendations, making it easier for them to justify a product sale to their clients.
He added that PlanTech and Cannex would continue to provide Genesys with base information to assist it in constructing the in-house recommendations.
Cannex adviser service manager Chris McEvoy said Genesys’ decision to take its research in-house had not upset Cannex.
“What they’re doing is pretty unique. A lot of the other dealer groups have their own recommended product list, but as a dealer group they’re taking that one step further by doing their own research.
“But they’re still going to need the stuff we provide to look at premiums quotings and competitiveness comparisons.”
Fullager said Genesys would work with the two research providers, so that in future they could both once again perform all of the research for the dealer group’s risk advisers — but on Genesys’ terms.
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