Founded in Bermuda in 2011, Custodian Life is a relative newcomer to the life insurance sector that offers only a single product – the Exclusive Investment Bond (EIB). But while the product range appears restricted, the bond can be used to invest in a wide array of products, including Qrops; and tailored to each individual investor.
Tom Olander, a director of Bermuda-based Custodian Life, says funds under management tripled in 2015, albeit from a low base, and he expects that number to triple again in 2016.
Where are your sales currently strongest?
We have stronger sales in Russia and south-east Asia right now. In general in south-east Asia, the big life companies have been more reluctant to take on new business, and we have had quite a few incoming calls.
We have now entered the local market in Indonesia. We have not set up an office there but have teamed up with local wealth management firms. We are doing business in most of the countries in Asia but we are staying out of Hong Kong and Singapore because we are not regulated there.
That is more of a management and board decision to stay out from those two places. When I look at the statistics and at what kind of volume there is both in Singapore and Hong Kong, I do not see a business case right now for a young life company competing in these highly regulated and extremely expensive markets. For now, it does not make sense.
In Russia, we are working through local wealth management firms targeting both local national and expats.
You had plans for the Middle East, Africa and Latin America, what is happening?
In a positive way, we have not been able to free resources to enter Africa or Latin America due to the heavy inflow of capital in other markets.
We are looking to expand into both Africa and Latin America in the coming 12 months.
Several major life companies are restructuring. How is this affecting your business?
Where the big ones are pulling out of the market, we are taking a lot of business.
IFAs can get fresh terms of business. They open a new policy with Custodian Life and transfer both assets and cash from their old policies. They do not go via the client, it goes directly to us. That is a huge thing we are seeing right now.
We see a lot of old policies with no penalties that are being transferred over, and then the IFA puts on a small management fee. That is what we are seeing right now.
What kind of clients do you attract?
We have attracted the more sophisticated clients. With our exclusive co-operation with Saxo Bank we are able to offer clients the bank’s multi-product trading platform, CustodianTrader, which provides an environment complete with prices, market data and news modules, analysis and charting functions.
Managers with discretionary mandates for client’s portfolios like the wide range of products that we have and the possibility to trade 24/7. With CustodianTrader, you have more than 30,000 different instruments and you can trade around the clock when the markets are open. It is a huge difference from sending a fax to buy a stock.
In 2016, clients are demanding everything online and they do not want to wait two or three days and see what execution price they got on an equity.
How is technology currently changing your business?
We are constantly developing the services and the platform we provide to clients, so our IFAs can see improvements almost on a daily basis. But in the near future we hope to launch two major upgrades.
The first will be an online application form so the client, together with the IFA, can fill in all the information online and start the policy application by themselves. This will make it easier for all the involved parties. We currently do accept scanned copies.