POWERED BY MOMENTUM MEDIA
Super merger complexity demonstrates benefit of advice
The proliferation of superannuation fund mergers and possible insurance changes for members should be a talking point for advisers to demonstrate their value when it comes to insurance advice.
Speaking at the AFA roadshow in Sydney, Adam Crabbe, risk strategy specialist at Zurich, said members may be unaware their super fund had merged.
There had been many mergers in the past few years with some funds such as Aware Super and Hostplus enacting multiple mergers of smaller funds.
Crabbe said: “There have been multiple acquisitions in the last few years but 20% of members are unaware that their fund has merged. What does that mean when they come to seek advice?”
When it came to insurance, he said funds would likely have different policies and it could be difficult for an adviser to establish how a person’s cover could change when their fund merged. This complexity could be a cue for the adviser to demonstrate how they help the client, particularly as consumers were often unwilling to pay for advice on insurance.
He gave the example of Hostplus which had merged with Statewide Super, Intrust Super and Club Super but the insurance policies all differed widely between the four funds.
“All funds have their own strengths and weaknesses and how does that affect the members’ cover? The merged fund should be able to give you that information but you should have the confidence to provide a fee for service for that engagement.
“Where there is complexity, that might help you to articulate to the client where the research and work is needed and why costs will be incurred.”
AUTHOR
Laura Dew
Laura Dew is editor at Super Review. Prior to joining SR, she spent five years working at Investment Week in the UK covering asset and wealth management.
Recommended for you
The super fund announced that Gregory has been appointed to its executive leadership team, taking on the fresh role of chief advice officer.
The deputy governor has warned that, as super funds’ overseas assets grow and liquidity risks rise, they will need to expand their FX hedge books to manage currency exposure effectively.
Super funds have built on early financial year momentum, as growth funds deliver strong results driven by equities and resilient bonds.
The super fund has announced that Mark Rider will step down from his position of chief investment officer (CIO) after deciding to “semi-retire” from full-time work.
TOP PERFORMING FUNDS
ACS FIXED INT - AUSTRALIA/GLOBAL BOND
Fund name
3y(%)pa
1
DomaCom DFS Mortgage
76.97 3 y p.a(%)
2
Global X 21Shares Bitcoin ETF
76.46 3 y p.a(%)
3
UBS Solactive Global Pure Gold Miners UCITS ETF Dis USD
51.13 3 y p.a(%)
4
Global X GlobalX FANG+ ETF
45.15 3 y p.a(%)
5
Select Baker steel Gold Institutional
43.78 3 y p.a(%)
