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AIA vitality

[NEW] 26 July 2019

AIA Vitality is a scientifically backed health and wellbeing program that is designed to support members to improve their health. AIA Vitality members are encouraged to know their health, improve their health, and enjoy the rewards of leading a healthy lifestyle. AIA Vitality members earn points through a number of health and fitness related activities. These can include health and nutrition assessments, along with physical activity targets.

Here’s how it works

With AIA Vitality, your clients are encouraged to:

  1. Know their health – AIA Vitality offers a range of health assessments and screening programs to help members better understand their health.
  2. Improve their health – AIA Vitality helps members maintain and improve their health by providing weekly personalised physical activity targets, awarding points for participation in organised fitness events, tracking sleeping habits, and access to discounted active wear, free access to Alan Carr's Stop Smoking program, and up to a 25% discount on a Fitbit and Garmin device.
  3. Enjoy the Rewards – AIA Vitality keeps members motivated with ongoing rewards for their efforts, including: discounts on entertainment, insurance premiums, and lifestyle partners. Rewards typically increase as members improve their AIA Vitality status. To view our list of partners see below:

Click here to see an overview of the AIA Vitality program and some FAQs.

 

How can AIA Vitality help your business?

Changing the conversation

AIA Vitality provides you with the opportunity to have more meaningful conversations with your clients. This will change the way you do business by:

  • Enabling you to provide your clients with an engaging and rewarding insurance proposition
  • Positioning your financial advice to focus on wellbeing along with the benefits and rewards of AIA Vitality
  • Providing you with additional opportunities to speak with your clients about their progress on the program
  • Providing you with additional referral opportunities from engaged AIA Vitality members

In some markets, we have seen Advisers organise wellbeing days to support clients in engaging with the AIA Vitality program, progressing through the tiers, and generating additional referral opportunities.  

Benefits for you

Experience in overseas markets, including Australia, has consistently shown that AIA Vitality members hold higher levels of cover and have significantly better persistency rates.

Commission

You will earn initial and renewal commissions based on the underlying insurance premium before the AIA Vitality discount is applied. This is to create value alignment between you and your clients – we don’t want your earnings to be reduced because you have encouraged your clients to engage with AIA Vitality.

For example, if a client’s annualised premium is $1,500 and the client’s premium is reduced to $1,350 following the 10% AIA Vitality discount, the Adviser will continue to earn commission on the original $1,500 premium.

Note: The AIA Vitality membership fee does not attract commission. 

 

What is the AIA Vitality premium discount?

AIA Vitality is based on the concept of “shared value” between the customer, the adviser, and the insurer.

Engaged AIA Vitality members are expected to generate value through improved persistency and reduced claims costs. This value is shared with your clients through premium discounts and rewards and with the Adviser through increased commission revenue.

Customers who elect to join AIA Vitality will automatically receive an initial 10% premium discount on eligible risk and health policies. The discount applies to the insurance premium including percentage loadings (e.g. BMI loadings) but excluding the policy fee and per-mille loadings (e.g. loadings for hazardous pursuits).

Click here to view FAQs.

How does the AIA Vitality premium discount flexing work?

At each policy anniversary date, the AIA Vitality discount level may be affected by the member’s current status:

When a life assured signs up to AIA Vitality, the member will receive an initial discount of 10% on all eligible policies.

For example: an AIA Vitality member who achieves Silver status at their first policy anniversary would have their discount reduced from 10% to 9%. If the member subsequently achieves Platinum status the following year, the discount would increase from 9% to 11%.

This feature is called “premium flexing”.

The minimum discount is 0%. Therefore, AIA Vitality members who do not retain their discount will not pay higher premiums than customers who have not joined the AIA Vitality program.

 

What is the cost of joining AIA Vitality?

The AIA Vitality membership fee is $11.50 per member per month (inc. GST). This fee recovers some of the program running costs.

 

Is my client’s privacy protected?

Member data privacy is very important to us and we take steps to ensure that the information collected in relation to the member’s AIA Vitality membership is kept separate from the client’s underwriting and claims information. 

Therefore, it’s important that AIA Vitality members disclose any relevant information when applying for new cover or altering their existing cover, as AIA does not consider any information contained within the AIA Vitality program.

For more information on Data privacy for AIA Vitality please click here.

AIA Living

23 July 2019

At AIA NZ, one of the ways we help Kiwis live healthier, longer, better lives is by providing innovative and comprehensive protection and wellbeing solutions.

AIA Living is our range of personal and business insurance across Life, Trauma, Income Protection, Total Permanent Disablement, and Health.

Over the last few months we have made many enhancements to broadly align the existing AIA and Sovereign products. This aligned product forms the foundation of AIA Living. All of the below will be available from 5 August:

Life Insurance

  • AIA Living Life Cover
  • AIA Living Family Protection
  • AIA Living Accidental Death

Trauma Insurance

  • AIA Living Critical Conditions
  • AIA Living Progressive Care

TPD Insurance

  • AIA Living Total Permanent Disablement

Income Protection Insurance

  • AIA Living Income Protection
  • AIA Living Mortgage and Income Protection
  • AIA Living Business Continuity
  • AIA Living Rural Continuity
  • AIA Living Business Income Support
  • AIA Start-Up Income Protection

Health Insurance

  • AIA Private Health
  • AIA Private Health Plus 

Accidental Injury Insurance

  • AIA Living Accidental Injury Cover

Click here to access our new AIA Living Product Suite brochure that outlines the built-in and optional benefits available under these products. 

Benefits not available under AIA Living

Below is a list of existing AIA REAL and TotalCareMax products that will not be offered under the AIA Living range. Naturally, existing AIA and Sovereign clients holding these products will continue to be covered and will not be disadvantaged by our decision to close these products to new business.

Personal

Business

Optional Benefits

  • Essential Living Assurance
  • Essential Disability Income Protection / Vital Income Protection
  • Essential Living Assurance
  • Disability Income Protection – Business Overheads
  • Disability Income Protection – Locum Cover
  • Specialists and Diagnostic Testing Benefit
  • Employee Upgrade Benefit
  • Cancer Treatment Benefit – We’re looking to relaunch this product in the near future

Pricing & Multi-benefit Discount

23 July 2019

The new AIA Living product range has been priced to deliver outstanding customer value, particularly when taken in combination with AIA Vitality. 

Our new pricing structure comprises:

  • competitive base rates across the entire product range;
  • a tiered Multi-Benefit Discount; and
  • an AIA Vitality membership discount starting at 10%.

On 5 August, you will be able to quote for AIA Living through AIAHub. We are working with QuoteMonster to have AIA Living and AIA Vitality ready to be quoted at launch. 

The pricing of AIA Living differs from existing AIA and Sovereign products and we have developed some flexible options to help you tailor an insurance product to meet the needs of existing and new clients.

CAN EXISTING CUSTOMERS ACCESS THE Multi-Benefit Discount?

Our new tiered Multi-Benefit Discount will apply to AIA Living risk products (excluding health) based on the number of products held by the customer:

  • 10% for two products;
  • 12.5% for three products; and
  • 15% for four products.

The Multi-Benefit Discount applies within product category levels: Life, Income Protection, Trauma, and TPD. i.e A customer who purchases Life Cover, Loss of Earnings, and Mortgage and Income Protection will receive a 10% discount on the basis that Loss of Earnings and Mortgage and Income Protection fall within “Income Protection” product category.

To qualify for the Multi-Benefit Discount, customers are required to hold a minimum $100,000 Life Cover plus a minimum $75,000 Trauma, $75,000 TPD, or $2,000 (monthly benefit) Income Protection.

If a customer removes a benefit, the Multi-Benefit Discount is re-calculated to reflect the new level of cover.

You can view the full terms and conditions here or our customer Multi-Benefit Discount flyer here.

How can existing customers access the Multi-Benefit Discount?

We have developed a flexible approach that provides you and your clients with the opportunity to tailor cover according to their needs and budget.

Existing AIA and Sovereign customers who purchase additional cover will be eligible to receive a Multi-Benefit Discount on their new cover. The calculation of the Multi-Benefit Discount will take account of the customer’s existing AIA and Sovereign advised risk policies, including any closed (legacy) products.

For example, if an existing Sovereign TotalCareMax customer holding Life Cover and Income Protection purchases a new AIA Living Trauma product, the customer will receive a 12.5% Multi-Benefit Discount on the new Trauma product.

In addition, existing AIA customers holding risk policies issued since June 2001 and retail health policies (excluding Superior Health 3) can migrate to AIA Living without any underwriting. Similarly, Sovereign TotalCareMax customers and Sovereign customers holding underwritten health policies (MajorCare, Absolute Health, and Private Health) can migrate to AIA Living without any underwriting.

Existing customers who migrate to AIA Living will pay the standard AIA Living premium.

Extending the example above, the Sovereign TotalCareMax customer may instead decide to consolidate their existing cover (Life Cover and Income Protection) and new cover (Trauma) under a new AIA Living policy. In this case, the customer will pay the standard AIA Living premium, which includes the 12.5% Multi-Benefit Discount.

We will share more information about our flexible replacement rules soon.

HOW DOES THE Multi-BENefit discount interact with the AIA vitality discount?

The AIA Vitality discount and the Multi-Benefit discount are additive - this means that both discounts are added together and applied to the insurance premium.

For example, if a customer is eligible for a 10% AIA Vitality discount and a 12.5% Multi-Benefit Discount, the customer will receive a 22.5% premium discount. 

Commission schedule

23 July 2019

AIA Living will attract a new commission structure, which:

  • Supports good customer outcomes;
  • Offers Advisers fair and competitive remuneration;
  • Is simple to understand; and
  • Addresses points raised by the FMA in its review of the life insurance industry.

What is the commission on AIA Living?

AIA Living offers Advisers a choice of three simple commission options:

  • Standard for those Advisers who prefer a higher Basic Initial commission ("BIC");
  • Pendulum for those Advisers who prefer higher renewal commissions ("RC"); and
  • Voluntary for Voluntary Group Risk schemes (underwritten employer schemes) where customers receive a 10% premium discount.

In addition to the basic initial commission ('BIC') rates shown in the table below, AIA recognises Advisers who elect to receive their initial commission on an “As Earned” basis (i.e. spread over 24 months as premiums are paid) by increasing initial commission payments by a further 5%.

At launch, we will also be offering Advisers an additional 20% BIC for a limited time for submitting proposals electronically using our AIAHub eApp solution. AIAHub simplifies and enhances the application experience – enabling you to present underwriting terms and issue cover for some clients on-screen.

Please note that commission is paid on the annualised regular premium (“ARP”), which is calculated after the Multi-Benefit Discount but excludes any applicable GST or policy fee. ARP is not reduced by the AIA Vitality premium discount.

 

Standard

Pendulum

Voluntary Group Risk

BIC

Risk – RFA

190%

120%

120%

Risk – Level

150%

95%

Health

120% if taken with Life

30% if standalone

N/A

N/A

As Earned option

+5%

+5%

+5%

Renewal commission

Risk – RFA

7.5%

20%

13.5%

Risk – Level

3%

15%

13.5%

Health

7.5% (if 120% BIC)

20% (in 30% BIC)

N/A

N/A

 

What is the commission responsibility period?

AIA Living will continue to require a 24 month commission responsibility period. The rate of commission debit for a lapsed policy is dependent on the number of months since policy commencement:

Months since policy commencement

Up to 12 months

Up to 18 months

Up to 24 months

25 months+

Commission debit rate

100%

50%

25%

Nil

 

Why does the AIA commission structure no longer take account of production or persistency?

In its report into the life insurance industry, the FMA made the following observation:

“We expect insurers to review their commission structures and volume bonuses for intermediaries – including structures with very high upfront commissions – to ensure they are incentivising intermediaries to deliver good customer outcomes.”

We have also received feedback from Advisers that our commission structure should be simple to understand and disclose (if required).

Taking this view into account, our new commission structure offers a flat headline commission rate across all risk products and a choice of an "Standard" or "Pendulum" option. 

We have taken the view that volume and persistency related commission bonuses drive unnecessary complexity and risk distracting attention away from the important work that Advisers perform for their clients.

 

Why do you pay a lower rate of commission on level premium products?

Our commission structure attempts to achieve a similar level of Adviser remuneration across all premium types.

Level premium policies carry higher initial premiums compared with otherwise equivalent rate-for-age polices. As a result, level premium policies attract a lower initial commission rate to take account of the higher “commissionable” premium.

Level premium policies also have much higher persistency rates, which is reflected in the lower renewal rate.

Even after allowing for the reduced rates of commission, expected commission payments for level premium policies are higher than otherwise equivalent rate-for-age policies.

Click here for some FAQs on commission.

AIA Living

11 July 2019

At AIA NZ, one of the ways we help Kiwis live healthier, longer, better lives is by providing innovative and comprehensive protection and wellbeing solutions.

AIA Living is our range of personal and business insurance across Life, Trauma, Income Protection, Total Permanent Disablement, and Health.

Over the last few months we have made many enhancements to broadly align the existing AIA and Sovereign products. This aligned product forms the foundation of AIA Living. We will share more detailed information about AIA Living in two weeks.

AIA Vitality

11 July 2019

Our vision is to champion New Zealand to be one of the healthiest and most protected nations in the world. To help us realise this vision, we are excited to launch AIA Vitality – our scientifically-backed health and wellbeing program that supports people to make healthier lifestyle choices.

AIA Vitality has been a game changer for customers and advisers in 18 markets. We will be excited to bring the program to New Zealanders on 5 August 2019 and to work with you to make insurance engaging and rewarding for customers.

We’ll share more information about AIA Vitality later this week. 

Questions? Comments?

Please contact your BDM or email aia@sovereign.co.nz

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