Australian advisers too stressed to stay in the industry - will NZ follow?

Australian advisers too stressed to stay in the industry - will NZ follow? | Insurance Business New Zealand

Australian advisers too stressed to stay in the industry - will NZ follow?

AIA New Zealand recently announced that it would be sponsoring a research project into the mental health and wellbeing of New Zealand’s adviser community, and a similar study conducted in Australia has produced some dire results, with 42% of respondents considering leaving the profession due to stress levels.

The New Zealand research will look at how market disruptions and uncertainty have affected the wellbeing of the adviser community, and if the Australian results are anything to go by, we may be looking at significant levels of stress and burnout - as high as 73% in the Australian study.

AIA chief partnership insurance officer Sam Tremethick noted that the Australian research was undertaken as COVID-19 was just ramping up in the country, and the majority of the stress faced by advisers was around a changing regulatory environment. He said that given New Zealand’s own regulatory and licensing changes, plus changes in customer expectations, COVID-19, rising household debt levels and ongoing global uncertainty, the pressure on advisers has increased to a point where mental wellbeing has become a significant concern.

“AIA Australia did some research which looked at adviser wellbeing at a time that was actually very early days in COVID, and it was more around the regulatory changes that was enforced on the Australia adviser community, and their general health,” Tremethick explained.

Read more: AIA NZ sponsors mental health research on financial advisers

“It was fair to say that the results were dire. Seventy three per cent (73%) of respondents had suffered from some form of burnout and stress, and that was really about things they couldn’t control - changes in advice processes, commission levels, in the way they needed to service their clients, etc.”

“These were all things they couldn’t control, and they were really the main drivers of the burnout,” he said.

“Sixty-three per cent (63%) acknowledged that they had experienced some kind of depression, and 61% had poor sleep due to stress. These are huge numbers across the industry.”

Tremethick said that the economic impact of poor mental wellbeing is already well documented, and if advisers start dropping out of the industry due to burnout and stress, then businesses and customer outcomes will also suffer.

Read more: AIA NZ updates underwriting approach to mental health

With ongoing restrictions across parts of New Zealand and case numbers fluctuating day by day, uncertainty is higher now than it has been over the past 18 months. Tremethick said that the numbers from the Australian study were “alarming”, and clearly signalled the need for a more intensive conversation around mental wellbeing in advisers - particularly in periods of increased uncertainty.

“For us, it’s really about how we can look after the advisers first with respect to their mental health and mental wellbeing, because that’s actually going to have a huge impact on outcomes for clients,” he said.

“This is a societal issue, it’s not just an advice issue - one in four New Zealanders will suffer from some form of mental health issue in any given year, and it is estimated that this costs the New Zealand economy $12 billion in lost revenue through absenteeism and low productivity. So, it’s something that we all need to face into and work towards, and it’s a personal journey.”

“There are definitely some advisers who have been able to move with things, build a business and thrive, but there are also advisers who have been struggling,” he explained.

“I think this is about people not being able to control some things, and grappling with that. There is no end date to COVID, and there are challenges to businesses in terms of servicing existing clients. The normal problems haven’t disappeared, and then you also have the business impacts of COVID.”

“The key takeaway for me is that these are terrible numbers, and alarmingly, 42% of the respondents said they were going to leave the profession,” he added.

“That has a huge impact on society. We know that people who get advice are much better off, and if a chunk of the adviser community was going to leave, that’s not a great outcome. This is why we want to do the research in New Zealand, and I think we’re going to have some work to do.”