Innovation, opportunities and mindset

In the second half of last year, iExtend took its licensing roadshow nationally to its iExchange Forum members and had the pleasure of CoreData CEO Andrew Inwood presenting the “Granularity of Growth”, an exploration of the golden age of advice, the size of the prize and the power of transformation.

As the most recent case study of innovation in the insurance industry, iExtend is optimistic about the opportunities ahead for the life insurance industry while also acknowledging the growing trend of policyholders cancelling their cover.

Currently, the cost-of-living crisis, rising interest rates and premiums are the triple threat when it comes to retaining life insurance, and we know first hand from advisers that they are triggering clients to question the value of their life insurance and to perceive it more as a liability rather than an asset.

iExtend offers an alternative to life insurance policyholders who have committed to cancelling or reducing their life cover. iExtend pays all premiums on co-owned life cover while future claim benefits are shared with the policyholder, their beneficiaries or estate, with the claim split based on how long iExtend has been paying the premiums.

Interestingly, one in four of the policies that iExtend assesses is kept by the policyholder, providing an important retention strategy for advisers who can maintain their commitment to being there when their client needs them most.

As Inwood noted in his presentation, we are in a golden age of advice where demand exceeds supply and industry transformation will be keenly driven by AI solutions, creating new efficiencies and cost benefits.

Further, the size of the prize is significant, with $4.9 trillion in intergenerational wealth, with the average Baby Boomers representing $3.3 trillion in assets. Trust in financial planners is higher than in federal politicians, at 5.2/10 compared to 3.5/10, yet growing the size of the pie remains a challenge.

Much of this, Inwood said, has to do with a growth mindset, and CoreData has identified 25 per cent of practices with strong growth plans that are keen to grow. Meanwhile, more than 50 per cent of practices who are identified as having general growth plans are happy for the status quo to remain the same.

Innovation is an integral part of the insurance industry’s future, yet sadly, it has been lacking for more than 30 years. By supporting advisers and helping them retain their clients, iExtend is challenging the perception of life insurance as a liability to help reinstate its status as an essential asset.

Protip DasGupta is head of distribution, iExtend