More member information needed

Larger superannuation funds, particularly industry funds, are likely to rely more on digitally-generated advice but need to know more about their members to do so, according to a Rice Warner analysis.

The analysis said the reliance, augmented by human-based advice, would be a means to improve and expand the fund's existing advisory services and engagement with members.

Rice Warner said digitally-based advice would be the next logical step as most members relied on the automatic rebalancing of premised diversified portfolios designed to suit their broad risk classification at a generally low cost.

"Super funds are likely to seek further development of the self-directed and guided advice tools... These include calculators covering adequacy of retirement savings, contribution optimisation, insurance needs and risk profiling," the analysis said.

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"The calculators are designed to let members know their current position and how to improve that situation; effectively providing a call to action."

However, the research house said many industry funds did not know enough about their members to provide personal robo-advice.

"Many industry funds, do not know their members' incomes, total super and non-super assets, marital status, partner's assets and superannuation, liabilities or financial goals," it said.

"The introduction of robo-advice will provide an opportunity for super funds to get to know and segment their members much better."

While Rice Warner said in theory robo-advice should provide a consistent standard of advice, the quality would depend on the quality and appropriateness of the information and rules programmed into the software.