The top life insurers are moving into wealth management to keep up not with the Joneses, but with the advisors.
Insurance advisors are a big part of the reason carriers are venturing into wealth management, according to one analyst.
“We are seeing brokers and advisors look at things more holistically, where they look at coverage for insurance and wealth and savings,” said Nazir Valani, KPMG’s senior actuary for life and pensions. “They want to provide both so the insurance companies are reacting to this. They want to be the provider for both coverages, so definitely there is a move to say ‘let’s sell insurance and let’s also get into the wealth management business.’”
A lot of advisors are becoming more than just salespeople to their clients, offering strategic, long-term solutions that encompass a large part of their financial plan.
“It’s a change within the industry,” said Jennifer Black, president of Dedicated Financial Services Inc. “It’s not just about selling life and health insurance, it’s about figuring out why people need it and being able to work with them to show them how it benefits them or how it will benefit their family. I don’t know if you can call it a trend or maybe it’s just the way the industry has evolved.”
The shift shouldn’t come as a surprise to industry professionals, but the increased emphasis on savings is hard to miss.
“The life insurance industry has always had products where there is permanent coverage with a savings component,” said Valani. “But definitely as people try to save within their insurance plan it will create larger funds and these are tax sheltered.”
Advisors are well positioned to cash in on the phenomenon as more Canadians come to appreciate the investment savings potential of insurance.
“As people find out that insurance can be a good vehicle to save money and have it tax-sheltered I think there will be more growth on the savings side on the wealth management side,” said Valani.
“We are seeing brokers and advisors look at things more holistically, where they look at coverage for insurance and wealth and savings,” said Nazir Valani, KPMG’s senior actuary for life and pensions. “They want to provide both so the insurance companies are reacting to this. They want to be the provider for both coverages, so definitely there is a move to say ‘let’s sell insurance and let’s also get into the wealth management business.’”
A lot of advisors are becoming more than just salespeople to their clients, offering strategic, long-term solutions that encompass a large part of their financial plan.
“It’s a change within the industry,” said Jennifer Black, president of Dedicated Financial Services Inc. “It’s not just about selling life and health insurance, it’s about figuring out why people need it and being able to work with them to show them how it benefits them or how it will benefit their family. I don’t know if you can call it a trend or maybe it’s just the way the industry has evolved.”
The shift shouldn’t come as a surprise to industry professionals, but the increased emphasis on savings is hard to miss.
“The life insurance industry has always had products where there is permanent coverage with a savings component,” said Valani. “But definitely as people try to save within their insurance plan it will create larger funds and these are tax sheltered.”
Advisors are well positioned to cash in on the phenomenon as more Canadians come to appreciate the investment savings potential of insurance.
“As people find out that insurance can be a good vehicle to save money and have it tax-sheltered I think there will be more growth on the savings side on the wealth management side,” said Valani.
