Life insurers and advisers are currently dealing with some big pain points.
A significant reduction in commissions over the last five years has come at the same time as an increase in compliance and regulatory requirements meaning an increase in effort and a decrease in revenue.
The pressure on risk advice industry costs has forced many advisers out of the industry or away from providing risk advice — leading to impactful reduction in new business volumes across the market.
“You've got competing forces trying to do business,” says entrepreneur Marc Fabris, who has spent most of his career in the financial and life insurance advice industries.
“There's a demand for greater efficiency but according to roughly 60 per cent of advisers I’ve surveyed, the cost of doing business is way too high.”
He adds that you can't just bring in an insurtech to fix a problem in five minutes.
“It's likely more complex than solving a problem for a retailer for example, where the main issue might be payment processing and data. For life insurers, there are many other elements to be mindful of — such as material outsourcing obligations that can prove quite a challenge.”
Fabris says a lot of his conversations with advisers are about the lack of focus on client engagement and the inability to add value because of the pressure to tick the compliance boxes.
“There's opportunity all round to save money, engage clients better and improve efficiencies.”
The place to go for answers
Enter Risk Hub, an insurtech startup Fabris founded last year to be a one-stop shop for life industry stakeholders across the value chain.
It services insurers, advisers who are writing insurance and those who are not, plus their support staff, licensees and service providers. Functioning as a middle person, the platform helps users quickly and easily gain access to information they need.
“I saw that advisers needed a central place to find solutions and support,” Fabris tells.
“Risk Hub is for anyone who’s struggling, spending all their time and effort on compliance and regulation. There's still a lot to do, but we’ve made a start. We also see this as a platform to drive other related programs and initiatives.”
Originally a Canberran, Fabris’ father was a naval architect and his mother a court transcriber “back in the day” when it was done by hand, His family lived in Bath, England for a few years, which Fabris recalls as a fascinating experience, although he was very young.
Dedication to advice
He says many people influenced him and he gravitated towards self-employment in risk advice for about eight years early in his career before taking a role with AMP as an account manager.
"The real-world experience with my own advice business was pivotal for the work I do now at Point1, my new consulting business, and Risk Hub," Fabris says. "Those early experiences have enabled me to understand the complexities that practices face today."
At AMP, Fabris focused on enhancing both risk-specific insurance products and advice processes in a wide range of roles incorporating product management, research and shaping sales strategy.
An ongoing commitment to reading and self-improvement saw him rise into corporate strategic, sales, research, product development and risk related roles with the life insurance and financial services arms of Zurich in Sydney and Switzerland.
In his most recent role as Head of Digital, Fabris led the company’s digital development by leveraging global relationships and business opportunities.
He also led the establishment of the inaugural AFA (Association of Financial Advisers) Adviser of the Year Award, an achievement of which he’s very proud.
“For several years I was a judge and onsite assessor for the award program, which continues today (with the Financial Advice Association of Australia) and has established itself as the highest adviser accolade,” Fabris says. “I was proud to have received a commendation from AFA for my efforts.”
Curation not creation
Fabris credits his experience with Zurich Financial Services with the trajectory that inspired Point1 Consulting and the founding of Risk Hub.
“I always thought I'd be back (to self-employment),” he says. “While it’s quite a few decades later [than I expected], I always had that affinity with advice and advisers and so much of my corporate life has been focused on supporting advice delivery.”
Fabris shares that creating a platform to support advisers in life insurance had been on his mind for many years.
“When I left the corporate world, I saw three key opportunities: helping advisers with what they do, helping licensees, and corporate work using my experience around supporting programs,” he explains. “All of those are hard to achieve at once, which supplied the impetus for Risk Hub.”
The Risk Hub concept is not so much about creation as it is about curation. One of its important functions is to promote tech and other service providers and their products so that advisers can assess the systems they need, for example, the preferred suppliers of virtual assistants.
“There are so many options and variations, that people don't know where to go,” Fabris says. “Having worked for a number of life insurers, I also recognise that they aren't always good at delivering timely website updates and communications. Risk Hub saves time and money by allowing advisers to access information in one central place.”
Pushing the industry forwards
So far so good, and Fabris is working on further collaborative projects to improve life advisers' overall service offering.
“The idea is to build a community to support industry growth plus undertake research and surveys to discover what innovations are needed along the value chain to push advisers forward,” he says.
Fabris will facilitate a panel at Insurtech Australia’s upcoming conference, InsurtechLIVE 24 about how insurers can keep themselves relevant using insurtech.
He says his message to participating insurtechs will essentially be that it’s time to get involved in helping solve the life industry’s problems.
Up until now, most Australian insurtechs have largely focused on the general insurance industry, including embedded insurance innovations.
“In the life space, we've talked about [embedded insurance] for so many years but it’s yet to be incorporated in mortgage processes or others,” he says.
There’s also a need for Australia’s small direct life insurance market to be expanded. “How do you actually deal with partners to help you to engage better? How do you better understand the context of your clients?”
“There are multiple journeys — onboarding, engagement, servicing, claims and cancellation to name a few,” he says. “Onboarding is the most obvious opportunity in respect of new business and growth, but annual reviews are also a classic challenge. There have got to be more touch points and interactions than just that once a year, and insurers might not be the best at that.”
AI and stilling the fear of change
Fabris says you can't ignore artificial intelligence and its applications across the value chain.
“Being able to understand and transform data will mean bringing everything together in a far superior way. There are massive opportunities in AI to bring efficiencies into advised, direct, group and embedded life insurance in ways that would have been far too costly in the past.
“People are frightened about the implications because of data protection concerns, which is fair and valid, but it doesn't mean that you should just be waiting for the next year or two to see what happens.”
For Fabris, “there is absolutely an opportunity for insurtech engagement to either collaborate, share ideas, or work directly with insurers in in each of the areas of need.
“The panel will potentially get insurers to open up more and be a part of the conversation, as well as informing and encouraging insurtechs to interact with direct insurers. I would love to see the life insurance advice space grow and receive more support.”