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Advisers have their work cut out for them

24 March 2021 Myra Knoesen
Jenny Ingram

Jenny Ingram

According to the World Health Organization (WHO) we soon will have more older people than children and more people at extreme old age than ever before. The number of people aged 65 or older is projected to grow from an estimated 524 million in 2010 to nearly 1.5 billion in 2050.

As both the proportion of older people and lifespan increases throughout the world, WHO noted that key questions arise. Will aging be accompanied by a longer period of good health (also often referred to as quality of life), a sustained sense of well-being, and extended periods of social engagement and productivity, or will it be associated with more illness, disability and cost? 

Circumstances and realities

“Even though in the South African context our data is too sparse to definitively comment on the fact that people are living longer, we know that in some pockets it is happening,” said Jenny Ingram, Head of Product Development for Momentum Retail Life Insurance. 

“Unfortunately, in South Africa we have a very unequal society, made even worse by Covid-19. Our data, as well as data from other countries, shows that people in higher socio-economic classes, who can access good medical care, are showing improvements in lifespans. Hence, it is crucial to plan for this and for advisers to help these clients navigate those possibilities,” emphasised Ingram. 

“Financial advisers also have their work cut out for them in terms of the very different circumstances and realities their clients are facing today. Some of the younger generations are holding multiple jobs in order to reach their ambitions – posing more challenges to their advisers to find the right insurance solutions for them,” added Ingram. 

Could this be the push we need? 

“We believe Covid-19 has, over and above the economic devastation and other challenges, brought about some permanent changes to some aspects of how we design insurance benefits and service clients. Many insurers and advisers, although they have started to increase their digital footprint and means of doing business, were forced to accelerate many of these innovations during these times or to adopt a hybrid model which combines the best of what face-to-face and digital has to offer,” said Ingram. 

In a way, Ingram said, it was also an opportunity for the insurance industry to showcase its financial robustness and to be there for their clients during these difficult times. Therefore, the proven proper financial management of these institutions has stood it in good stead during these times. 

“In general, clients are now more aware of their insurance needs, which we hope will make the jobs of financial advisers a bit easier in the next few years as clients seek them out for good advice and planning. One of our main challenges will remain, and that is how we ensure more South Africans can get access to good financial advice,” emphasised Ingram. 

Financial advisers and financial plans 

“Thanks to medical advances clients are living longer, but not necessarily in good health. The medical advances enable them to survive, for example, a serious heart attack or a stroke – but that means they may need ongoing funds to live with the consequences of these conditions. If one has the necessary protection in place, those extra years could truly be a blessing in terms of more time spent with family and loved ones, but if it means one is financially dependent on others, it can really be challenging,” added Ingram. 

“Besides some of the socio-economic challenges we face, as societies with ageing populations there is a need for individual protection and awareness about the possibility of living a long life with, or without, a serious medical condition. It is, therefore, important that clients and their financial advisers incorporate this into their long-term financial plans,” concluded Ingram. 

Writer’s Thoughts
As Ingram mentioned, financial advisers have their work cut out for them in terms of the very different circumstances and realities their clients are facing today. On the one hand, Covid-19 has brought about some permanent changes to some aspects of insurance, including possible risk factors for long-Covid. There are still so many unknowns about the true impact of Covid-19. On the other hand, as both the proportion of older people and lifespan increases throughout the world, questions arise. Will aging be accompanied by a longer period of good health, a sustained sense of well-being, and extended periods of social engagement and productivity, or will it be associated with more illness, disability and cost? Please comment below, interact with us on Twitter at @fanews_online or email me - [email protected]

Comments

Added by Andre, 25 Mar 2021
All these good intensions falls by the wayside due to a stubborn regime, ANC, who are only enriching themselves.

The prices of consumer goods is incontrollable rising, the role assurance plays becomes less and less since there is not many that can afford to put money away, and those that manages it, run into cashflow problems somewhere along the road and use the provisions to survive.

Biggest problem is medical aid costs which is just rising every year making it almost impossible for the average man to survive. I have just read an article stating that the average income of an household in the RSA is just over R15 000 per month.
There is no way that someone on that income can make provision for a longer life and have a medical aid , its just an impossible situation...... all the legislation regarding the financial industry during the past 15 years, did certainly contribute to the services being less available to the people who need it, but cannot afford it.

I do believe that aging will not be accompanied by good health and less disability and that the costs will only rise in these fields which will cause the majority of pensioners to be without a medical aid in a few years.

Financial independency at or after retirement will remain a pipe dream for most of the people, it seems that it is only available to the rich.

I am glad I am at the end of my career and not beginning or halfway through
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