John Trowbridge has been retained to assist a New Zealand Financial Services Council (NZFSC) investigation into sales incentives in life insurance.

Actuaries Melville Jessup Weaver will employ Mr Trowbridge as an adviser following his role with the Australian Financial Services Council’s review of the life industry, which resulted in dramatic proposals to change the industry’s commission system.

NZFSC CEO Peter Neilson says Melville Jessup Weaver will suggest ways to stop advisers churning clients to boost revenue.

“We expect the actuaries’ independent report will identify possible solutions for these issues,” he said.

“The NZFSC aims to have its own firm recommendations available by the time we submit on the Financial Advisers Act review proposals later this year.”

The Financial Advisers Act review is being undertaken by the Ministry of Business, Innovation and Employment.

Mr Neilson says Melville Jessup Weaver has been told to consult widely.

“The products the industry sells address issues such as premature death and unexpected serious illness that prevent earning an income – issues most people would prefer not to talk about,” he said.

“Because those products are sold, not bought, the industry mainly relies on an agent and broker distribution channel. For that reason, the actuaries are already meeting with agent and broker organisations to discuss the issues, options and opportunities.”