Two-fifths of consumers more likely to seek advice post-COVID

Research by MetLife Australia has found that Australians are seeing additional value in their advisers and the potential for the advice industry to support them through the pandemic.

Findings presented in the MetLife Adviser-Client Relationship report have shown a large chunk of consumers are more likely to seek advice and the experience of the pandemic has also made them generally concerned about their level of insurance cover.

A quarter of respondents said they felt they should increase their cover, while the proportion of those who felt they had adequate cover fell from 89 per cent the previous year to 80 per cent.

For consumers who had received advice, the majority (80 per cent) felt better about their financial position as the result of having an adviser, despite the challenges posed by the pandemic. Around four-fifths (82 per cent) felt better about having the right level of insurance.

Notably, 43 per cent of advised clients had not undergone a review in the past year. In turn, half of advised clients who had not received a review said they were thinking of leaving their adviser.

Clients were three times more likely to recommend their adviser if they received a review during the pandemic.

Meray El-Khoury, MetLife chief retail insurance officer commented COVID had shown the importance of “affordable, accessible financial advice”.

“This year the experience ratings of advice clients was the highest we have seen in the three years this research has been running, with approximately [a] 15 per cent increase in advisers receiving an excellent rating following a review,” Ms 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.”

Advisers had also adapted to the new environment, conducting more online and phone review.

“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,” Ms El-Khoury said.

Previous research from the insurer showed that by May last year, half of consumers felt their financial position had been impacted by the pandemic and around a third had sought some form of support as a result of feeling mentally unwell.