Leading student groups visiting MetLife’s Sydney office (students unless noted otherwise). Back row from left: Jeffrey Scott (MetLife), Hong Ji, Jarrel Dugay, Joseph Yeh, Jiho Lee, Ryan Han, Nathan Rees (MetLife), Wendy Tse (MetLife). Front row from left: Kevin Liu (UNSW), Michelle Lam (MetLife), Lesley Wang, Lynne Jiang, Annie Kim, Sohyeon Kim, Sohee Lee.

Student groups at UNSW recently took on important challenges faced by the superannuation industry. In projects designed and led by MetLife, Aware Super and The Conexus Institute, students were exposed to current challenges in the areas of engagement and default fund design.

None of these challenges has a straightforward solution, which is why they remain ongoing challenges, thereby providing a healthy dose of reality for students. Nonetheless, fresh thinking has created some interesting ideas.

UNSW’s Sandbox Program

Introduced in 2019, the aim of the UNSW Sandbox Program is to empower tripartite partnerships among industry, academics, and students to co-create solutions for contemporary business and societal problems. Industry partners develop project tasks which reflect real-world challenges and then engage with academics and student project groups through the term. In 2020 the Sandbox program was incorporated into the popular subject ‘Retirement Saving and Spending over the Lifecycle’ taught by Dr Kevin Liu, a foundational subject for those students interested in learning about Australia’s retirement system.

“Feedback constantly shows that students love the Sandbox Program and find it provides them with great exposure to the challenges faced by industry” commented Dr Liu. “Collaborating with industry leaders, we can co-create learning experiences that inspire young people to unleash their creativity to provide innovative solutions to some of the largest challenges faced by the superannuation industry.”

Engagement and insurance

MetLife Australia set students the task of how to get fund members to engage with their life and TPD insurance inside super to make sure they have appropriate insurance for their life stage.

MetLife Chief of Staff, Strategy and External Affairs Wendy Tse said: “Improving peoples’ financial literacy so they feel protected and in control of their finances is central to MetLife’s purpose of helping people live a more confident future.”

Lynne Jiang, Lesley Wang, Joseph Yeh, Jarrel Dugay, and Clinton Lui were members of the group which was awarded best project. The winning solution focused on using emotive messages to gain peoples’ attention, while giving members a target ‘nudge’ at specific life stages to review their coverage. It also proposed using simple language when communicating with members to help improve their financial literacy.

“Life insurance is not something that is set and forget. We should continuously reconsider coverage levels based on life events and changing circumstances,” Ms Tse said.

Default design for accumulation

Aware Super and The Conexus Institute partnered to set students the task of designing an MySuper default strategy. Students were provided a starting model which projected the distribution of outcomes for cohorts with varying contribution patterns. From here, students were left to determine an investment strategy (broadly a through-life allocation between growth and defensive assets). This relates back to discussion on static MySuper strategies versus lifecycle strategies.

“MySuper design is one of the most critical issues in the superannuation industry and has always been at the forefront of public discussion. This project provided students a taste of how super funds design their investment strategies to deliver the best retirement outcomes to members” commented Shang Wu from Aware Super.

Leading teams were provided the opportunity to present to APRA staff for further experience and feedback.

The group awarded best project (Tara Dabrowski, Katherine Liu, Alastair Nicholls, Yatharth Raval, and Andrew Uen) developed a balanced scorecard of metrics which helped them develop lifecycle strategies tailored to different member cohorts.

“We were really impressed by the presentations from the students. It is highly promising to see engaged bright young minds looking at innovative solutions for the industry” commented APRA’s Katrina Ellis, Acting Executive Director, Superannuation.

Leading student groups visiting APRA’s Sydney office (students unless noted otherwise). Back row from left: David Bell (Conexus Institute), Katrina Ellis (APRA), Gary Chan, Rakesh Beniwal, Alastair Nicholls, Yatharth Raval, Shang Wu (Aware Super), Kevin Liu (UNSW). Front row from left: Andrew Uen, Tara Dabrowski, Katherine Liu.

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