Personal finance company bridges gap in financial advice market and bring life insurance expertise to the masses

Personal finance marketplace Compare Club is scaling with an aim to grow to $100m of managed premium in the life insurance space with the acquisition of financial advisory service Lifelong Insurance Solutions. 

The multi-million dollar acquisition means the personal finance marketplace company is well prepared to fill the void left by the exodus of life insurance advisors from the industry in the wake of increasing regulation around life insurance advice.

Since 2021, Compare Club has added an additional 2,600 additional life insurance customers through acquisitions. The company currently has over $40m of life insurance premium under management and its projected trajectory is to have $100m within three years through both organic growth and acquisitions. 

Last year, Compare Club also acquired a portion of Zebra Financial Services’ life insurance book. The company also acquired financial news publication YourLifeChoices in 2019. 

Lance Goodman, Compare Club CEO, said: “As a result of increased compliance costs stemming from the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, only people who can afford top rates for financial advice are getting life insurance advice, leaving a big gap in the market for middle income households who are buying a highly complex product.”

“With increasing numbers of financial advisors getting out of the life insurance business due to increased regulatory costs, we’ve identified an opportunity for growth in the $33bn sector and our business model makes us uniquely placed to fill this gap.”

“We’re always looking for new and innovative ways to help our customers. With this latest acquisition, we’re best placed to use or scale and technology to step into the gap that regulation created. We’re able to service customers who can’t be serviced by traditional financial advisors because that model no longer suits them.”

As part of the most recent acquisition, Compare Club has onboarded three of Lifelong’s senior financial advisors, expanding their scale and capability to put the company in a unique position to provide affordable life insurance brokerage to a target market which can’t receive this service elsewhere.

“One of the main advantages of being under the Compare Club brand is that due to our scale, we can access premium services and prices from insurers through our partnerships. There's also less need for paperwork due to our digital capabilities, something that many financial advisors can't offer,” Mr Goodman said.

“Additionally, being part of Compare Club Group comes with the ability to help Australians manage some of their other major expenses such as health insurance, their mortgages, car loan repayments and even energy costs. Every one of our vertical product lines has a unique offering or dominates the market in a certain way, and life insurance is no exception.”

“Our dedicated advice team means we've been able to succeed in the life insurance market where competitors, who white label other providers’ services, have failed.”

“The free nature of our general advice model means we're uniquely positioned to benefit from the exodus of financial advisors, which will only get worse as we get closer to September - the deadline for their adviser exams,” he said.

“This growth in life insurance has resulted in earnings growth for Compare Club as a whole. There is a lot of scope for a comparator-broker to grow in life insurance over the coming decade and we expect there to be more acquisitions in this space in the near future.”

For more information, please visit compareclub.com.au