HFANZ: Referred Elective Surgery Need Just the Tip of the Iceburg

17. March 2016 08:31 by Kelly in   //  Tags: , ,   //   Comments (0)

Health Funds Association of New Zealand - MEDIA RELEASE from 7 March 2016.

Referred elective surgery need just the tip of the iceberg

The Health Funds Association (HFANZ) says the Government has made a good start in measuring the unmet needs of New Zealanders referred for elective surgery, but stresses that this subset of unmet need is part of a much bigger picture.

Government figures released today show thousands of New Zealanders are going without the surgery they need due to an overloaded public health system.

“While measuring referred unmet need is important, it is just a small slice of total unmet need,” HFANZ chief executive Roger Styles said.

In 2013, HFANZ conducted research which indicated that while around 110,000 New Zealanders were officially waiting for elective surgery, there were another 170,000 requiring surgery but who were not on any list.

“These are people who need surgery and may be in pain, but whose GP has not referred them on the basis that they are unlikely to meet the public sector threshold to get it within four months.

“Health Minister Jonathan Coleman is right when he says that the best way to meet unmet need is to carry out more surgeries. Growing demand for elective surgery needs to be addressed and one way of doing this is to improve access to elective surgery via health insurance,” Mr Styles said.

“New Zealand has a strong public health system that deals well with emergency, maternity, mental health and life-threatening conditions. The private health sector complements this system by relieving pressure for elective procedures and in a more timely fashion.

“Our members’ message to Government is simple: the private health sector is here to support, not undercut, the public system,” he said.

“Elective surgery wait times do not need to get worse before they get better.”

HFANZ said health insurance had funded more than 150,000 elective surgical procedures in the past year, but with increased demand, there was the capacity and the willingness to do much more.

Results from HFANZ’s 2016 research into this need will be released later this month.


Professionalism in Financial Advice: What it is, What it is not

16. March 2016 08:13 by Kelly in   //  Tags:   //   Comments (0)

At a recent workshop I heard one participant say that they thought 'we all want advice to be a profession and if we got together for an hour or two we would all have a pretty clear idea of what that is.' Sadly, I beg to differ, and there are many different points of view. 

One person will tell you that the essence of professionalism is independence, defined as freedom from conflicts of interest. In this world a truly professional financial adviser cannot receive anything other than fee income from the client. Obviously, they cannot be the employee of a financial service provider. 

Another will tell you that the essence of professional advice is providing a wide-range of products - even the best product available, from a seemingly unlimited universe. There is a strong component of this in the recommendations of the Trowbridge report, perhaps unusually, many financial advisers that provide advice on insurance products feel the same way.

Our current Financial Advisers Act and AFA Code place suitability assessmentat the heart of advice and have no specific prescriptions to make on either commissions or range, apart from insisting that they are both clearly disclosed. This is a view I have a lot of sympathy with. Some take it to the point of insisting on a degree-level qualification. 

Some will insist on all of these, and perhaps they are the true purists: no conflicts, unlimited universe, state-of-the-art suitability testing. In such a world very little financial advice would be given. While this debate rages I occasionally look around and see how other professions are managing. An article I just read explains how one professional adviser forgot about something and it left his client severely, permanently, disadvantaged - far more than any action of omission on your part could affect your clients - his penalty? Merely censure. You can read of another professional who admits lying about all sorts of things, including employment history, work performance, and criminal past, arguing for just a two month suspension

So maybe on one front financial advisers are already well ahead of some other professions: the penalties for failure are personal and they are real. 

Southern Cross Cracking Down on Travel Insurance Fraud

15. March 2016 08:14 by Kelly in   //  Tags: ,   //   Comments (0)

Southern Cross Travel Insurance CEO Craig Morrison talks to Mike Hosking in this clip about the issue they are facing with travel insurance fraud. It is believe they receive about 1,500 people making false claims each year, and they are all related to lost/stolen property. Travellers use forged letters from overseas hotels, taxi drivers, and police to support their claims and are increasingly being caught out. 

Read more here.

Sovereign Targets Millennials with New Campaign

14. March 2016 08:13 by Kelly in   //  Tags: ,   //   Comments (0)

Soveriegn have recently launched a new product called Simple Life with a younger audience in mind. The process is 100% online and takes less than five minutes. There is a maximum cover amount of $500,000 Life cover with optional add-ons of Loan and rent cover, and redundancy cover. As the product is not underwritten, pre-existing conditions and hazardous activities are not covered.

Sovereign's head of brand James Perrin says "Many millennials have a bullet-proof attitude and believe nothing is going to happen to them and/or perceive insurance and financial planning as complicated or boring which can result in it falling short on the priority list and being put off for ‘another day’."

Click here to read more about the campaign.

NZ Cancer Death Rates by Region

11. March 2016 08:10 by Kelly in   //  Tags:   //   Comments (0)

This article on Stuff.co.nz shows the cancer death rates per 100,000 people in each region across NZ. The statistics showed Northlanders were 1.3 times more likely to die of cancer than Kiwis living in Waitemata. That means for every 100,000 Northlanders, there are 33 extra cancer deaths.

Some key findings showed:

  • For all cancers, those in the worst performing regions died at 1.3 times the rate of those in low-cancer areas.
  • Rural Kiwis did worse than urban Kiwis. Waitemata, Nelson Marlborough, Capital and Coast, Auckland and Canterbury DHBs had the lowest death rates, while Northland, Tairawhiti, Lakes, Wairarapa and Taranaki had the highest.
  • Cancer deaths were mostly highest in populations with high deprivation and more Maori, but bowel cancer deaths were concentrated in white, wealthy southern regions.


This chart from the Ministry of Health (2010-2012) shows the number of cancer deaths by region. If you click through to the article you can dynamically change the chart for specific cancers. 

Asteron Life Waiver of Premium on Lump Sum Benefits in Quotemonster

10. March 2016 08:09 by Kelly in   //  Tags: ,   //   Comments (0)

Recently it has been brought to our attention that Asteron Life only offers a 13 week wait period for lump sum benefits. There is a product / basket selection decision to be made in www.quotemonster.co.nz comparisons. For example, if you were to select a package of life, trauma, and TPD and then add waiver of premium at a wait period of four weeks the current approach would generally be to drop Asteron Life from the presented quote package - because they don't have this option. However, we have modified this rule in certain circumstances. For example, we have permitted $300 excess products to appear in the same set as $250 excess products for medical insurance, properly labelled. 

Then there is the issue of a plan combined with income protection insurance. Add income protection to the scenario above and technically there are two waiver benefits, one with a 13 week wait and one with a four week wait. We have decided to calculate the premium based on the mix and present it all in the selected product set appropriately labelled. The wording is detailed below. 


Policy Upgrade Features

9. March 2016 08:15 by Kelly in   //  Tags:   //   Comments (0)

Policy upgrade features, the practice of updating in-force policy terms and conditions with upgraded features is relatively new. Some long-standing providers have only but recently adopted it. Due to the gradual incorporation of this feature by companies that distribute through primarily through financial advisers, many have shadowed competitors’ policy wording, and an increasing number of in-force policies now have the same terms as those issued new. Also, many benefit terms and conditions are very similar.

There are however two fundamental standards to consider:

  1. When did the upgrade benefit come into effect; and
  2. To what specified policy issue date (if any) does this benefit retrospectively apply.

We have summarised these in the table below:


For those companies with pass-back provisions  extending to 2001 as a proportion of in-force books only a small minority of policies in-force will have products that do not auto update, but these may still number in the tens of thousands.

Most providers choose to extend this feature only to policies issued since the feature was introduced. Moreover, where the feature has been ‘passed-back’ to existing policy-holders, a limit has been fixed to how far back it applies. Consequently, the oldest in-force policies may be excluded from qualifying for this feature. Insurers have maintained this is a result of contractual obligations with reinsurers wherein older policies were approved on the basis of different terms and conditions than to those of newly-issued ones. Valid though it may be - insight conveys that clients who have been paying premiums for lengthy periods are, perhaps, disadvantaged. On the other hand some of these older policies retain some features that may not be available in a modern policy.

Outwardly the upgrade policy wording benefit emerges as a generous feature accentuating insurers’ commitment to recompense the loyalty of policy-holders. However, it also serves a purpose of synchronising existing products’ content with developments in the macro-environment. An insurer benefits as much as existing clients from the upgrade benefit, which enables insurers for example to:

  • curtail anti-selection (where the healthier lives in an in-force product abandon it and update their cover with a competitor, leaving only an aging in-force client base)
  • consolidate IT platforms where all system developments designed to manage enhanced products can also accommodate all in-force clients
  • eliminate varied pricing segments for the same products - facilitating a streamlined pricing strategy
  • avert excessive administrative costs which can spur from mass policy conversions by existing clients wanting enhanced products
  • simplify operational processes by transferring older policies to current terms of administration
  • relay consistent brand messaging and product-related publications

CommInsure in Controversy Over Heart Attack Claims - Australia

8. March 2016 08:12 by Kelly in   //  Tags:   //   Comments (0)

Australian insurer CommInsure owned by Commonwealth Bank is facing allegations of unethical and unscrupulous behaviour from ABC news and Fairfax. ABC News has an extensive piece on the claims payment issue.

It is fascinating because it highlights a key issue in insurance product comparison - being able to accept that a heart attack has happened based on one of a number of criteria or medical advice. The video interviewing the client highlights how serious the heart attack one man suffered, and the importance for insurers in getting the definition in the policy to line up with medical definitions. In essence, if I customer is told they are 'having a serious heart attack' and are 'lucky to be alive' they are going to expect that to qualify. If the definition is coming up with significantly different answers to this expectation it is likely to cause problems. 

Read his story here.

Medical Insurance Cancelled After Insurer Turns Down Claim

7. March 2016 08:32 by Kelly in   //  Tags: ,   //   Comments (0)

A Nelson family have cancelled their health insurance with Southern Cross after having a claim denied for their 18 year old daughters breast correction surgery. When they asked for their insurer's reasons in writing, they were told: "The procedure which you have submitted a claim for - modified mastopexy to the right breast and augmentation of the left breast- is not a treatment that is covered by Southern Cross. "It is an exclusion on all Southern Cross plans. Southern Cross only provides cover for breast reconstruction and breast surgery for symmetry that is considered medically necessary (e.g. following mastectomy for breast cancer)." Southern Cross has offered a $5000 ex-gratia contribution to the $13,500 approximate cost of the surgery.

I am always worried about the definition of 'medically necessary' and without declaring either Southern Cross or the family of the young woman as 'right' I would like to point out the difficulty of the situation. It is also worth stating that I have no idea exactly how significant the condition is for the young woman, it may be terrible. Instead, let me give a personal example: my daughter has recently started to wear braces.

The dental experts said this was a borderline case - that perhaps the situation would worsen a lot, with teeth forced out of line and requiring removal and the appearance of unsightly gaps, and perhaps not. Blessed with the resources to manage the problem, we asked Sophia what she would like to do and she has opted to wear braces. She has been insured from birth but it did not even occur to me that this could be a claimable procedure. Perhaps a worse situation would have been. My point is this. A line must exist somewhere. It actually doesn't matter exactly where the line is drawn, provided that consumers can see clearly where it is. Preferably before they buy the cover. The market can then provide options: some products for those customers prepared to pay more for more cover, some for those that want more budget coverage.  

Read the full article on NZ Herald website here.

Mind The Gap: Stats From the Forum

4. March 2016 08:51 by Kelly in   //  Tags:   //   Comments (0)

Here are some more stats from the recent Mind The Gap Forum.

Most people severely underestimate the likelihood of being off work for a long period caused by sickness.
  • 60% of employed New Zealanders think that the chance of being unable to work for 6 months or more is the same or greater following an accident rather than sickness.
  • In reality for employed 18-64 year old New Zealanders, it is 1.8 times more likely that a main earner will be off work for 6 months or more following sickness than following an accident.
Many people don’t understand that Social Welfare or ACC may not be able to help them.
  • 51% of people 18-64, in employment are not aware that their partner’s income (if $30,000 or more) will preclude them from receiving all or part of a Job Seeker allowance (previously known as a sickness benefit at a maximum of $340 a week).
  • 1 in 5 New Zealanders think wrongly that ACC covers long term sickness that prevents employment.