Australians see additional value in their financial advisers and the potential for the advice industry as they face the financial impacts of the COVID-19 pandemic, according to new research from MetLife.
The MetLife Adviser-Client Relationship Report provides insights from consumers, as well as small to medium enterprises (SMEs) with up to 20 employees, who have life insurance purchased through a financial adviser, and those who are more likely to see a financial adviser about life insurance in the next two years.
According to the report, over 40% of Australians considering seeing a financial adviser said they were more likely to consult one now than before the pandemic hit the country.
Consumers have also become concerned about whether they have the right level of insurance cover, with 25% of the respondents saying they should increase their cover. Meanwhile, around a 10% drop in the number of consumers felt like they have adequate cover.
MetLife chief retail insurance officer Meray El-Khoury said the pandemic highlighted the significance of affordable, accessible financial advice.
“This year, the experience ratings of advised clients were the highest we have seen in the three years this research has been running, with approximately 15% increase in advisers receiving an excellent rating following a review,” El-Khoury said.
“Now is the time for advisers to be investing in relationship-building and clear, transparent communication to help their clients make sound financial decisions for their future. Reviews have always been critical in helping advisers drive loyalty and recommendations, but their importance reached new levels during the pandemic and advisers that invest in them proactively will continue to be rewarded.”
By May 2020, half of consumer respondents said their financial position took a hit from the pandemic, while around a third sought some form of support as a result of feeling mentally unwell, the report said.
The report also showed that 80% of advised clients felt better about their financial position after seeing a financial adviser despite the pandemic-related challenges. Meanwhile, 82% said they felt better about having the right level of life insurance.
“We have seen advisers pivot their review approach to the conditions with more online and phone reviews. This has been a significant cultural shift for the industry, but the research shows that where clients have received these consultations proactively, over the phone or online, they have been happy with the experience,” El-Khoury said.
