Aon’s financial planning arm has struck a deal with Axa and Comminsure to act as preferred suppliers of life insurance products and will add two or three others to the list soon.

According to Greg Dunger, general manager of the group’s two advice businesses – Aon Wealth Management and Aon Financial Planning and Protection, the aim is to have only “four or five” life companies on the preferred list. He said a recent survey has found Aon is the third biggest writer of life risk products in Australia and is generating premium revenues of about $20 million annually. The latest move also follows on the back of Aon’s attempt to reduce the amount of investment platforms used in its planning practices by creating a preferred list of suppliers. Dunger told Investment & Technology this month the number of preferred platforms would drop from seven to three or four by the end of 2005. Dunger said Aon has negotiated volume bonuses for business written with the preferred life companies and has also specified qualitative criteria to be included. “We’re about growing new business not just moving the same money around,” he said. “We want to be rewarded for net funds and some companies had trouble coming to grips with that.” The insurance industry is often criticised for its propensity to ‘churn’ consumers from product to product rather than attract new clients. At the same time many studies have warned Australians they are chronically under-insured. “We also see there will be less upfront commissions and are moving to a hybrid/ongoing service model for insurance,” Dunger said.

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