Robo advice is expected to become more widespread in Asia among those planning for their retirement, as can be seen from the traction it is gaining in the superannuation industry in Australia, predicts Milliman Australia practice leader Wade Matterson.
"Technology advancements have now made it possible for financial institutions to provide consumers with tailored investment strategies and product solutions to achieve their goals in retirement,” he said.
He made these remarks in conjunction with the release of a report by Milliman analysing the current and future state of the retirement income market in the Asia-Pacific region. Milliman is a premier global consulting and actuarial firm.
Key findings from the report include:
- The vast majority of respondents feel their national retirement systems' provisions are inadequate – even those traditionally considered to have more advanced systems such as Singapore and Australia.
- Regarding the most important features in a retirement income product, respondents feel consumers would value some type of guarantee, either income or capital protection, with simplicity being a consistent third across most countries.
- When it comes to financial advice, over 60% of participants felt financial advice was needed but 63% cited cost as the primary impediment for consumers.
"Across Asia-Pacific, there is the potential for private market providers to complement and fill gaps that exist from government-sponsored retirement systems and employer-sponsored pension arrangements," said Mr Richard Holloway, Managing Director for Milliman's South East Asia and India life consulting practice.
The report is based on a survey of over 100 insurance companies and financial institutions across eight countries.