John Billington
Viewpoint with John Billington

by John Billington
General Manager
IOOF Portfolio Solutions

Welcome to the April Edition of @dviser Magazine.

In competitive golf every shot pleases somebody. Shameless opposition even chuckle as you slice away into the trees.

It’s similar in the economy where almost all possible scenarios create a profit opportunity for some business or other.

Obviously steady growth is best for the vast majority but some do see profits rise during a downturn. The most obvious examples are the ‘vice sectors’ (tobacco, alcohol and gambling) whose shares often move against the tide during economic strife. (Sadly fruit, vegetables and the gym are not what we seem to turn to in hard times.)

Here’s one industry that’s booming through the gloom

Another sector that seems to be shrugging off the downturn – at least in Australia – is life insurance.

One major insurer reported Q1 2009 sales that were 25 per cent better than Q1 2008. Meanwhile another big player is showing premium revenue across the company up 65 per cent during 2008-09 (with their group insurance premiums up a massive 122 per cent).

The industry as a whole enjoyed a 12 per cent jump in life insurance sales in 2008 – up from $6.4billion to $7.2billion – according to research by Plan for Life.

The insurance industry also has one of the few buoyant job markets in Australia with many firms hiring new staff to cope with strong demand.

Help your clients get a measure of security

The trend is further evidence (not that we needed it) of how the psychology of our clients has changed. Where the focus was big gains and fast profits, disillusioned investors are now looking to safeguard their wealth.

Many Australians face reduced investment/super balances, high debt and low job security – adequate insurance at least helps reduce risk while providing some peace of mind.

This means insurance – particularly insurance in super – is a positive topic for you to be raising with your clients at the moment. By talking about insurance you get to provide holistic advice and cover a large portion of your client’s financial needs in one swoop.

From a business perspective, insurance (in super) makes your super business more sticky. Plus, it creates a stable source of income - not linked to market volatility.

Insurance is now much easier

You’ve got plenty of reasons to make sure your clients are adequately insured, that’s why we’re pleased to be able to make the application process much easier with the new Insurance Online functionality.

With Insurance Online you apply using a smart web application that only asks the questions your client needs to answer. The application is direct to the underwriter (rather than having an extra step of going via IOOF with a paper application), and best of all, you get an instant response when you submit the application.

Insurance Online is something we’re very enthusiastic about. It’s a way that you can create significant business efficiencies with minimal effort, so be sure to read more about it in this month’s Newsflash section.

You’ll also find some great technical insights into holding insurance in super in this month’s Technical Strategy section.

Now to another new initiative…

As you have hopefully experienced first-hand, we have a fantastic group of people working at IOOF. In fact, our people are the most important asset we have as a business. That’s why we’ve launched the ‘Our People’ section - NEW to this month’s edition of @dviser. Each month we profile a different person from around the business to give you an insight into the many individuals that work hard to provide the best possible products/services for you and your clients.

We hope you enjoy reading this edition. As always, please feel free to contact me with your queries. Alternatively, you could phone or email your Business Development Manager, or call Adviser Services on 1800 659 634.

John Billington