Insurance dealer group mySolutions has announced a change in its membership subscription model from July 2021, and will no longer be funded by member overrides. Instead, the commission packages paid by insurers will go directly to adviser members, and the cost of membership will be $50 a month.
CEO Kevin Smee said that the fee would gain members access to business development training, along with other group benefits and member services. He said that advisers would be “thousands of dollars better off just by accessing the group’s buying power,” and that feedback to the change has so far been positive.
The announcement comes on the back of several life insurers changing the way they work with dealer groups, with Partners Life having been the first to announce that it was scrapping override commissions to dealer groups.
“The recent changes we’ve seen in the industry with regards to regulation really drove this move, along with changes made by life insurers to their commission models,” Smee said.
“The dealer groups were all funded by overrides at one particular stage, and that was paid by the insurers to the dealer groups. But when Partners Life came to the market with its FAPO model, they decided they were going to pay the money directly to the license holders rather than the dealer groups.”
“When it comes to our membership, we have a very straightforward commercial proposition for our existing 280 or so members - do the benefits of belonging outweigh the cost?” he continued.
“Advisers who want this certainly won’t be concerned with a basic membership fee, especially when they are getting 100% of the earnings they generate.”
Smee said that mySolutions had been working on this change over the last 18 months, and had “signalled strongly” to its stakeholders that it would be doing things differently.
“This group is pretty unique in that it is led by advisers, for advisers,” he said.
“We have been quite a strong player in this space for some time, but MySolutions is not a FAP and isn’t planning to be one. We’ve been working with everyone in our group for a long time to help them either get their own transitional license or become a part of one of the other license holders.”
“We’ve been collaborating with our members to ensure that there were no surprises for them, and so far everyone is saying that it’s fair and reasonable,” he added.
“We definitely didn’t want to make price a barrier to becoming a member of the group. Our role with mySolutions is helping them grow their practices to become more sustainable, profitable businesses.”
