Asteron Life is considering a wholesale product model that will let advisers build in commissions.

EM Mark Vilo says as wholesalers of products, advisers can create their own remuneration models.

“If a 20% level commission becomes the model of the future, the adviser can build the remuneration up to that,” he told a company roadshow in Melbourne last week.

“It is an idea we are looking at, but I don’t say the model has all the answers.”

Mr Vilo says the model is included in a submission to the Federal Government regarding recent parliamentary joint committee recommendations on adviser standards.

“We will not be releasing the submission publicly because we feel it has some proprietary information we don’t want to share with our competitors,” he said.

Mr Vilo says Asteron has also considered the recent Trowbridge report recommendations, and finds the industry response has been fractured.

“We haven’t shown leadership as an industry to bring a response together.”  

Suncorp-owned Asteron has run internal modelling on positive and negative aspects of the remuneration recommendations.

Mr Vilo says there is no simple response to the proposals, with arguments on either side.

“Level is an interesting idea, but it has challenges,” he said. “The real challenge is to come up with a remuneration package the industry can be proud of.”

Mr Vilo says one thing is certain: the life industry’s structure is going to change, and the Trowbridge report is a turning point. “I can’t talk to an adviser and say nothing is going to change. But I can tell you cashflow is going to be very important in the future.”

He says Asteron has created an adviser remuneration modelling tool, allowing advisers to enter financial data from their practices and see how they are performing.