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.”