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Brokers given gift vouchers for insurance deals

By James Mitchell•Wednesday, 1 Feb 2017•7 minute read
The Adviser

One of Australia’s largest aggregators has launched a new insurance referral program that gives brokers Coles gift vouchers in exchange for policy sales.

AFG relationship managers explained the new offer in an email to brokers. Known as the ‘$100 Bonus Blitz’, the email explained that the campaign was launched to “assist you in protecting your clients should the unexpected occur”.

“The Life Insurance Referral Program is a simple and easy way for AFG brokers to refer customers for income protection and life insurance products through InsuranceLine – a TAL direct life insurance brand,” it said.

“Refer your clients to InsuranceLine for life insurance and income protection and their life insurance specialists will do the rest.

 
 

“InsuranceLine's life insurance specialists will refer to you when they speak to your clients, providing them with all the information they need and answer any questions they have about life insurance or income protection.”

The email included an attached template for brokers to use to start a conversation about insurance with their clients.

“Basically, we will give you a $100 Coles/Myer gift voucher if you produce three TAL/InsuranceLine policy sales from now up until the end of October!” the email explained.

“If you provide six sales you will be up for a $200 voucher and so on.”

The campaign started this week and will run through to Friday, 3 March 2017. Brokers were also given tips on how they could ‘win’:

“It’s easy to reach three policy sales over the period if you remember these three easy steps:

“Have a brief conversation with your clients about the importance of life and income protection insurance.

“Tell them that InsuranceLine will give them a call to discuss their options.

“Select when you would like us to contact your client on the life insurance pop-up when you press ‘Lodge Electronically’ in Flex. It’s that simple!”

The offer is made by InsuranceLine, a trading name of TAL Direct, which distributes insurance products to customers of AFG.

[Related: AFG explains new iSelect mortgage deal]

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James Mitchell

AUTHOR

James Mitchell has over eight years’ experience as a financial reporter and is the editor of Wealth and Wellness at Momentum Media.

He has a sound pedigree to cover the business of mortgages and the converging financial services sector having reported for leading finance titles InvestorDaily, InvestorWeekly, Accountants Daily, ifa, Mortgage Business, Residential Property Manager, Real Estate Business, SMSF Adviser, Smart Property Investment, and The Adviser.

He has also been published in The Daily Telegraph and contributed online to FST Media and Mergermarket, part of the Financial Times Group.

James holds a BA (Hons) in English Literature and an MA in Journalism.

 

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Comments (15)

  • Russell Cain Thursday, 02 February 2017
    I agree wouldn't a sound customer centric referral program to "Retail / Advised" policies over Direct policy proposition which research clearly demonstrates provides better claims outcomes to consumers [url=http://https://www.lifeinsurancedirect.com.au/why-do-direct-life-insurance-policies-have-high-decline-rates-2016-11-24/][/url] be a better long term customer retention / centric strategy. Not only do customers get greater certainty at claims time but far more affordable premiums [url=http://https://www.lifeinsurancedirect.com.au/quote-index/][/url] (making it easier for customers to meet their home loan repayment commitments). Lastly Retail policies generally have better policy definitions and benefits as well!
    0
  • OzBoy Thursday, 02 February 2017
    Pro Broker said: "This is the real deception that is occurring in the industry." and they are correct. I have to wonder if ASIC are having a look at the impact these commissions have on a broker. I know you think it would have none as the payment goes to the aggregator but what if I asked "has your aggregators software ever been independently reviewed?" A slight tweak could be a game changer for a particular lender and this is only one example. Until ALL of us in this industry get total transparency we will constantly be under scrutiny and these public examples of stupidity will not help.
    2
  • Pro Broker Wednesday, 01 February 2017
    No doubt AFG is receiving a slice of the pie here because $33 as a once off commission per policy is chump change compared to the usual industry referral commissions to ensue your clients are covered. I cannot imagine that AFG have negotiated with TAL to only pay their brokers in Coles vouchers, what is in it for AFG?
    If AFG are receiving a slice of the pie, how much are they receiving?
    This is the real deception that is occurring in the industry. Aggregation companies are negotiating and receiving income from third parties that may not be passed through to the brokers. We have heard through other articles, for example CBA decides to offer Bonus Commission on an Aggregator's Volume but doesn't insist that it is being passed through to the broker, therefore the Aggregator is pocketing these lump sums without informing its members (Mortgage Brokers).
    And here lies the real commission debate issue. I can tell my client that there is no conflict of interest regarding the lender I have chosen but unknowns to me, my Aggregators is potentially receiving a Bonus payment, not to mention the free lunch, the golf game, the afternoon on a yacht, the invite to a gala evening etc.
    So the Aggregator is receiving all of the perks because of the volumes its members, us Mortgage Brokers are writing. But as per normal, a government witch hunt targets the small operators in their investigations, the easy pickings, the ones they know do not have enough money to defend themselves in court... and so the manipulation continues whilst small businesses and their clients are the ones who suffer through lower commissions and higher interest rates whilst the real profits are being shared around with the big end of town...
    5
    • Anonymous Wednesday, 01 February 2017
      No surprise that most of the larger aggregators are owned by banks. They are all in bed with each other.
      0
  • Adam West Wednesday, 01 February 2017
    Who was the bone head who came up with the idea to launch this during the commission review?
    6
  • Anonymous Wednesday, 01 February 2017
    its only a gift voucher, get over it. Statistics show a majority of brokers don't give their customers life & TPD insurance options which they should be doing so under NCCP. I agree you should have a relationship with a financial planner but what's the difference? The FP will pay a commission on the policies they sell to your customers, are these disclosed to the customer? TAL may not be the best option but it still has a place for those brokers who forget to refer their clients to a FP. At least their clients are given options and the broker is covered off the NCCP requirement.
    -2
    • Coastie Wednesday, 01 February 2017
      As a financial planner all levels of income and referral fee splits inclusive of amounts retained by the AFSL dealer group MUST by clearly detailed within the formal the statement of advice and signed by the clients. Likewise with my mortgage broking business all income sources and referral fees are detailed and discussed within the NCCP credit proposal. Not disclosing sources of income or payment of referral fees is a breach.
      1
    • DAvery Wednesday, 01 February 2017
      Not many know it, but there is a huge difference in the quality of the cover when you compare direct, such as this, to underwritten insurance available via a financial planner.
      0
  • SA Broker Wednesday, 01 February 2017
    I can't believe a large aggregator like AFG would introduce this type of financial inducement at a time when all broker commissions/income are under the microscope. This just throws more ammunition at those (big bank backed) who want to break down the broker industry. Is AFG living in the same world as the rest of us? Is there full disclosure to the client that the broker will receive a financial benefit for the referral to TAL? Not smart.....
    4
  • Anonymous Wednesday, 01 February 2017
    They must be dreaming. Brokers will make their own arrangements with insurance specialists and get much more than this. Specialist insurance brokers will have a much better range of products and choice of Insurers.
    At $33 per referral - you place yourself at risk of the disappointment when TAL can't deliver or your customer finds a similar product at a much better price (will happen five out of ten times - with TAL premiums).
    I walked away from TAL some time ago because of this.
    0
    • DAvery Wednesday, 01 February 2017
      Yep. Not to mention there is a huge difference in the quality of the cover when you compare direct, such as this, to underwritten insurance available via a financial planner.
      -1
  • Anonymous Wednesday, 01 February 2017
    Isn't it this kind of soft commissions that ASIC is currently looking into. FFS don't add to the problem.
    3
  • DC Wednesday, 01 February 2017
    Perfect timing AFG. Send a full summation of this promotion straight to the inquiry into broker remuneration. PS. Can these vouchers be used for only food, or can you buy smokes as well?
    2
  • Paul Wednesday, 01 February 2017
    $100 for potentially thousands in commission sales?? pppfftt
    Here's an idea - have a qualified financial planning referral relationship................
    6
    • DAvery Wednesday, 01 February 2017
      Absolutely. Not to mention that the insurance via a financial planner is many times better than direct insurance like this as well.
      0
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