Replacement Business Policy (KiwiSaver) Learnings

Staff / Adviser completing this learnings record*

Q1: What is the primary purpose of the KiwiSaver Replacement Business Policy? (select one correct answer)*

To promote switching KiwiSaver providers frequentlyTo manage conduct and client risks associated with replacement businessTo discourage clients from investing in KiwiSaver productsTo reduce fees across all KiwiSaver products

Q2: What must advisers consider when recommending a switch in KiwiSaver provider? (select one correct answer)*

The client’s choice of investment fund onlyTheir own commission and incentivesThe client’s risk profile, investment horizon, and rationale for the switchThe financial performance of the provider alone

Q3: What should be fully disclosed to clients throughout the replacement business process? (select one correct answer)*

Only the potential benefits of switchingAll risks, fees, and potential impacts associated with switchingThe provider’s marketing incentivesNone of the above

Q4: According to the policy, how should conflicts of interest be handled? (select one correct answer)*

They should be ignored if they don’t impact the adviserAdvisers should avoid conflicts at all costs, even if it impacts the clientThey are only relevant if requested by the clientThey must be disclosed and managed according to the client’s best interests

Q5: What is a potential consequence of making short-term market-based decisions when switching KiwiSaver providers? (select one correct answer)*

Missing out on potential future gainsIncreased long-term benefitsAutomatic fee reductionsEnhanced tax efficiency

Q6: How often does the MTG report KiwiSaver replacement activity to the FMA? (select one correct answer)*

MonthlyQuarterlyAnnuallyEvery two years

Q7: Which of the following should be documented when a KiwiSaver replacement is recommended? (select one correct answer)*

The popularity of the new providerThe client’s current income levelPersonal details about the client’s familyEvidence supporting why a switch is in the client’s best interest

Q8: What is one potential risk associated with the tax treatment of a new KiwiSaver product? (select one correct answer)*

Increased ease of tax reportingPotentially less tax efficiency than the current productGuaranteed tax reductionsEnhanced tax benefits

Q9: Why is it important to understand the client’s risk tolerance and investment horizon when switching KiwiSaver products? (select one correct answer)*

To determine the adviser’s commission potentialTo align the new product with the client’s financial goals and risk toleranceTo simplify the switching processTo reduce the number of products the client holds

Total Score

You cannot submit this learning until you have reached a pass mark (90 points).

Total CPD Points Achieved