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AIA has also announced a refreshed commission structure for its advisers, which will bring the two separate structures from the pre-merged companies into one. The newly developed structure has also taken into account concerns raised by the FMA in its review into life insurers, and has been designed with good customer outcomes in mind.
“As we transition into one product range, we need to redefine the wider commission structure – and as part of that, we’ve also considered the wider context of good customer outcomes,” chief product and vitality officer Len Elikhis told Insurance Business.
“We wanted to ensure fair a competitive remuneration across the board, and we wanted something that was easy to understand and disclose. The commissions that we expect to pay will be very similar to the amounts that we currently pay across both structures, but there will be potential swings and roundabouts depending on the mix of business that the adviser is writing.”
“The FMA signalled that they had concerns about commissions varying by product, so our new structure offers the same rate regardless of risk product,” he added. “There were also concerns around production bonuses, and we’ve dispensed with those.”
With regards to product upgrades, Elikhis says there were some key points of difference between the AIA and Sovereign product suites, and the enhancements were designed with a view to creating as much alignment as possible.
Future AIA and Sovereign customers will benefit from all of these enhancements, and will be eligible to migrate from Sovereign onto AIA.
“As well as combining the product suites, we took this opportunity to deliver some enhancements to secure good customer outcomes,” Elikhis said.
“We introduced a medical advancement provision on our trauma product, which addresses concerns around outdated medical definitions. We’ve also developed the serious illness or injury condition, which guarantees payment of a claim if a client suffers significant injury or illness that leads to a period of hospitalisation. This will provide us with the opportunity to cover a wider range of conditions.”
AIA’s new product suites will be launched on Monday 5 August.
