Risk Worth Taking

When the going gets tough… sell insurance. That was the motto of many advisers during the global financial crisis, and it’s paid off handsomely.

According to initial data from the CoreData 2010 Risk Study, around half of advisers’ business income derived from providing clients with risk advice in the past 12 months came from new clients.

One of the consequences of the GFC was a shift in consumer focus from returns to risk, which played into the hands of advisers in search of a diversified source of revenue.

The research, which so far canvasses the views of more than 600 advisers, reveals that on average, 48.6% of advisers’ total risk income came from new clients while the remaining 51.4% came from existing clients.

Furthermore, similar to last year one in five advisers expects to increase the amount of insurance written with their main risk provider by more than 20% over the next 12 months.

Almost half of all advisers (48.1%) expect the level of risk being written to increase, while only 9.3% expect the amount of risk written to decrease.

Innovation with regards to eApps and online functionality is reflected in the proportion of advisers lodging new business applications electronically.

While paper-based applications remain the dominant application method, used by almost half of advisers (49.3%), two in five (43.1%) are using web-based applications and a handful (7.6%) are using smart forms (editable, saveable PDFs that may have the functionality to pre-populate from a desktop quoting tool).

*Initial analysis taken from CoreData’s 2010 Risk Study. The full research will be available in November.