QAR ‘tailwinds’ could lead to a return of advice

Presenting to investors at the Shaw and Partner Life Insurance Roundtable Series on Wednesday, ClearView Wealth managing director Nadine Gooderick said adviser exits may have reached their end.

“Recent data indicates the exodus of financial advisers has ‘bottomed out’. The government’s recent favourable response to the Quality of Advice Review is expected to provide strong tailwinds for the ‘return’ of advice. Supports return to growth,” ClearView said.

According to data from September 2023, life insurance is an $18 billion market across retail, group and direct to consumer channels, covering almost 80 per cent of non-dependant working age Australians, as of 30 June 2022.

“Due to the improving industry dynamics and financial adviser productivity, new business columns have grown for the last three quarters,” ClearView said.

According to the insurance firm, advised life insurance sales grew 7 per cent across the industry in the 2023 calendar year, growing for the first time in a decade.

The firm attributed the growth to “longer term sustainable factors such as population growth, ageing population, inflation and household wealth, income and debt levels”.

“Drivers in previous decline of advice sales are now well understood – industry appears to now have reset on firmer footing for growth,” ClearView said.

Establishing itself as an “accessible challenger brand” in the independent financial adviser (IFA) market, the firm has seen continued growth in HY24, holding 11 per cent of the new business market share of the IFA market, up from 9 per cent at 30 June 2023.

Showing no signs of slowing growth, Clearview said it is “strongly positioned to take further advantage of the market rebound” with a FY2026 target of 12–14 per cent of the new business IFA market share.

Currently ranking fourth in new business sales with $17.5 million in HY24, the firm said it “remains well positioned to continue to increase its new business share and to broaden its product offerings to adjunct products”.

In the process of shifting the firm’s core focus to life insurance, it exited financial advice in November 2023 with the sale of its 19.99 per cent equity stake in Centrepoint Alliance for $15.2 million in cash to COG Financial.

Earlier last year, the firm also announced it is in the process of selling its investment management business to Human Financial, which is expected to be completed by 1H FY25.