Harness Invest Limited
Disclosure Statement

Before We Get Started

As a professional adviser, there is important information you need to know before we can provide you with the best advice we can offer. Please read on to understand the information on how we are licensed, plus:

• What services we can provide and what they may cost you.
• How we operate
• Complaints handling
• Conflicts of interest
• Our conduct
• Data privacy and collection

It is important to note that the regulatory environment for Financial Advisers was reworked on March 15, 2021. Before this date, Advisers were divided into AFA’s, RFA’s and QFE’s. These terms no longer apply.

Key Definitions:

– FAP = Financial Advice Provider

– FAP Licence = Licence issued by the Financial Markets Authority enabling a FAP to provide advice

– Accreditation = Agency agreements between financial product providers such as Insurers, Banks, or Investment Product Providers enabling FAP (Financial Advisers) to provide advice on specific products.

License Information

Harness Invest Limited (FSP1001475), trading as (Harness Financial) holds a licence issued by the Financial Markets Authority to provide financial advice.

We have no license limitations.

• Harness Invest Limited
• Email: service@harnessfinancial.co.nz
• Ph: 0210 268 7955
• PO BOX 24514, Manners Street, Wellington, 6142
• Level 6, 114 The Terrace, Wellington Central, Wellington, 6011

Nature & Scope of Engagement

At Harness Invest Limited we provide the following services:

• Investment planning
• Short term savings
• Investment solutions
• Financial projections/retirement planning
• Cash management
• Cashflow analysis
• Emergency Fund

The Providers we use are for these services are:

• For our investment portfolios we the Consilium Platform powered by FNZ. We can source a very large number of managed funds and direct investments such as shares and bonds on the NZX, ASX, and other exchanges globally (mainly USA and UK) that are available to Retail investors in New Zealand. We also utilise the investment solutions from Booster, Milford and SuperLife.
• We may also get external research from Morningstar.
• For KiwiSaver, we work with three providers – Booster, Milford, Generate and SuperLife.

How We Operate

To ensure that our financial advisers prioritise the client’s interests above their own, we follow an internationally recognised professional advice process to ensure our recommendations are made based on the client’s goals and circumstances.

We want to understand what your vision is, what values you want to live by and then build a financial plan that best supports your lifestyle to give you the best chance of success.

Conduct

At Harness Invest Limited, anyone who gives financial advice on our behalf, has duties under the Financial Markets Conduct Act 2013 relating to the way that we give advice.

We are required to:

• give priority to your interests by taking all reasonable steps to make sure our advice isn’t materially influenced by our own interests.
• exercise care, diligence, and skill in providing you with advice.
• meet standards of competence, knowledge and skill set by the Code of Professional Conduct for Financial Advice Services (these are designed to make sure that we have the expertise needed to provide you with advice)
• meet standards of ethical behaviour, conduct and client care set by the Code of Professional Conduct for Financial Advice Services (these are designed to make sure we treat you as we should and give you suitable advice).

This is only a summary of the duties that we have. More information is available by contacting us, or by visiting the Financial Markets Authority website at https://www.fma.govt.nz.

Remuneration

Remuneration (what do our services cost?):

At Harness Invest Limited, we endeavour to be as independent and transparent with our fees as we possibly can. The fees we charge for the preparation of a financial plan are:

At Harness Invest Limited we charge for running a portfolio a percentage of asset under advice. These are typically as below but may vary depending on the size and complexity of the portfolio: Full costs will be provided to you in a Statement of Advice before you agreed to our services.

Brokerage

We do not collect broker fees as income but there may be broker fees that you have to pay if you want to transact any direct listed equities or bonds on an exchange. The indicative cost would be quoted at the time before transacting. It will depend on factors such as size of the trade, is research from an external party required and the exchange that it would be traded on.

Commissions

Typically, when it comes to investment portfolios, we avoid any commissions from product providers as we feel that that is a conflict of interest. Any commissions received in a portfolio run by Harness Invest Limited are refunded back to the investor.

With KiwiSaver, two of our providers only remunerate us through commissions and they are as follows:

With SuperLife, we can charge a separate advice fee of up 0.5%.

With Milford KiwiSaver’s, we charge a separate advice fee of up to 0.5% of which Milford rebate 0.2% directly to the client account. A one-off advice fee of $150 can also apply and be charged to the client KiwiSaver account.

Booster NZ also pays $30 to the adviser after year one for the work in transferring or opening a KiwiSaver account with them.

Generate KiwiSaver pays up to $300 to the adviser on new accounts.

• Dieter Timmerman is the only adviser and director working for Harness Invest Limited. His remuneration is based on the profitability of the company by way of drawings.

Conflicts of Interest

We take any perceived or real conflicts of interest very seriously and have a dedicated policy for dealing with such issues whereby we avoid, disclose and/or manage any conflicts so that our client’s interests are placed first and foremost.

For KiwiSaver, Harness Invest Limited will receive commissions from some of the providers on whose products we give advice. If you decide to take out KiwiSaver, the product providers will pay a commission to Harness Invest Limited. The amount of the commission is based on the balance of the KiwiSaver fund.

We undergo annual training about how to manage conflicts of interest. We undertake a compliance audit, and a review of our compliance programme annually by a reputable compliance adviser.

From time to time, product providers may also reward us for the overall business we provide to them. They may give us tickets to sports events, hampers, or other incentives.

Complaints Handling & Dispute Resolution

If you are not satisfied with our financial advice service, you can make a complaint by emailing complaints@harnessfinancial.co.nz or by calling: 0210 268 7955.

You can also write to us at:

• Harness Invest Limited
• PO BOX 24514, Manners Street, Wellington, 6142

When we receive a complaint, we will consider it following our internal complaints process:

• We will consider your complaint and let you know how we intend to resolve it. We may need to contact you to get further information about your complaint.
• We aim to resolve complaints within 10 working days of receiving them. If we can’t, we will contact you within that time to let you know we need more time to consider your complaint.
• We will contact you by phone or email to let you know whether we can resolve your complaint and how we propose to do so.

If we cannot agree on how to fix the issue, you can contact our external disputes resolution scheme, Insurance & Savings Ombudsman (IFSO).  IFSO provides a free and independent dispute resolution service that may help to resolve your complaint. To contact IFSO:

• Call: (04) 499 7612 or 0800 888 202
• Email: info@iombudsman.org.nz
• Write to: PO Box 10845, Wellington 6143
• Address: Level 11, Classic House, 15-17 Murphy St

Duties Information

At Harness Invest Limited our financial advisers have duties under the Financial Markets Conduct Act 2013 relating to the way that we give advice.

We are required to:

• give priority to your interests
• exercise care, diligence, and skill
• meet standards of competence, knowledge and skill set by the Code of Professional Conduct for Financial Advice Services
• meet standards of ethical behaviour, conduct and client care set by the Code of Professional Conduct for Financial Advice Services

Privacy/Data Collection

To give our clients the very best advice we need to collect personal information about their financial circumstances. In the digital age that we live in, we take our responsibilities under the Privacy Act 2020 very seriously. Some key points:

• We only collect information relevant to the nature and scope of the advice we are providing.
• The accuracy of this information to our advice is critical, this is where we need your help.

Once collected we will protect any client information:

• You can request any personal information or ask for it to be amended at any time
• We will only share information where it is necessary to do so in providing the agreed services provided. If this is not part of our normal business, we would only consider this with your express consent to do so. However, there are some third parties you may not be aware of that we may need to share your information with such as:
  • Financial Markets Authority (FMA) – the Regulator of financial services in New Zealand
  • External compliance agencies we may engage for quality assurance purposes.
• We have policies and procedures for dealing with any data breaches ASAP. Any information no longer needed will be destroyed

You can find out more by visiting our Privacy Policy at our website: Privacy Policy – Harness Financial

Ask Us – We Are Here To Help.

We welcome any questions or queries you have in relation to this important information but more importantly, we look forward to working with you.

Harness Insurance Ltd

Disclosure Statement

Before We Get Started

As a professional adviser, there is important information you need to know before we can provide you with the best advice we can offer. Please read on to understand the information on how we are licensed, plus:

• What services we can provide and what they may cost you.
• How we operate
• Complaint’s handling
• Conflicts of interest
• Our conduct
• Data privacy and collection

It is important to note that the regulatory environment for Financial Advisers was reworked on March 15, 2021. Before this date, Advisers were divided into AFA’s, RFA’s and QFE’s. These terms no longer apply.

Key Definitions:

– FAP = Financial Advice Provider
– FAP Licence = Licence issued by the Financial Markets Authority enabling a FAP to provide advice
– Accreditation = Agency agreements between financial product providers such as Insurers, Banks, or Investment Product Providers enabling FAP (Financial Advisers) to provide advice on specific products.

License Information

Harness Insurance (FSP250025), trading as (Harness Financial) holds a licence issued by the Financial Markets Authority to provide financial advice.

We have no license limitations.

• Harness Insurance Limited
• Email: service@harnessfinancial.co.nz
• Ph: 04 384 7113
• PO BOX 24514, Manners Street, Wellington, 6142
• Level 6, 114 The Terrace, Wellington Central, Wellington, 6011

Nature & Scope of Engagement

Taking into account their financial goals and current financial position; Harness Financial provides advice to clients regarding the following product types:

• Insurance as an Employee Benefit/Group Insurance Arrangements
  Life, Income, Trauma, Total Disability and Health Insurance are implemented at a discounted ‘group rate’ for staff, often with most pre-existing conditions covered.

• Business Risk Insurances (Key Person, Shareholder Protection)
  Forms of Life, Trauma, Total Disability, Income Protection (or Loss of Revenue Cover), and Health Insurance for the purpose of protecting a business’s profitability or ensuring the swift action of a planned succession.
• House Insurance
  Cover to replace or repair your House in the event of loss or damage, or in the event of causing loss to property you damage.
• Contents Insurance
  Cover to replace or repair your Home Contents in the event of loss or damage, or in the event of causing loss to the property you damage.
• Car Insurance
  Cover to replace or repair your vehicle in the event of loss or damage, or in the event of causing loss to property you damage.
• Vehicle loans
  Lending for vehicle purchase or refinance through Simplify Finance (this is a service we provide upon request to existing clients).
• General Financial Planning
  We can assist you with establishing your financial priorities and goals. We can also provide general commentary on your current financial position. This does not include investment advice. 
• Lifetime Cashflow Modelling
  We use software called Planolitix to effectively capture and report on your current financial position and trajectory. These outputs enhance and contribute to our Insurance Planning advice. 
• Budget Planning, Debt management
  We can assist you with general advice on these matters and refer you to experts for product-specific solutions. We do not provide specific product advice on lending facilities such as mortgages.
• Life Insurance
  Pays out a lump sum in the event of death or terminal illness. 
• Income Protection Insurance
  Replaces loss of income in the event of illness or injury on a monthly basis.
• Health Insurance
  Covers the cost of private medical treatment, specialist appointments, tests, diagnostic procedures, and treatment/drugs not covered by state-funded entity Pharmac.
• Trauma Insurance
  Pays out a lump sum upon diagnosis of up to 55 pre-set health conditions (depending on the insurer)
• Total and Permanent Disability Insurance
  Pays out a lump sum in the event of total and permanent disability.

The Providers we are accredited with whose services we offer are:

For personal and business risk insurance advice we work with the following insurers:

For domestic fire and general insurance advice we work with the following insurer:
AON StyleCover (underwritten by Vero)

How We Operate

To ensure that our financial advisers prioritise the client’s interests above their own, we follow an internationally recognised professional advice process to ensure our recommendations are made based on the client’s goals and circumstances.

We want to understand what your vision is, what values you want to live by and then build a financial plan that best supports your lifestyle to give you the best chance of success.

Conduct

At Harness Insurance Limited, and anyone who gives financial advice on our behalf, have duties under the Financial Markets Conduct Act 2013 relating to the way that we give advice.

We are required to:

• give priority to your interests by taking all reasonable steps to make sure our advice isn’t materially influenced by our own interests.
• exercise care, diligence, and skill in providing you with advice.
• meet standards of competence, knowledge and skill set by the Code of Professional Conduct for Financial Advice Services (these are designed to make sure that we have the expertise needed to provide you with advice)
• meet standards of ethical behaviour, conduct and client care set by the Code of Professional Conduct for Financial Advice Services (these are designed to make sure we treat you as we should and give you suitable advice).

This is only a summary of the duties that we have. More information is available by contacting us, or by visiting the Financial Markets Authority website at https://www.fma.govt.nz.

Remuneration & Commissions

Remuneration (what do our services cost?):

Typically, we are remunerated by way of commissions received directly from product providers. As we get to know you and what is important, we will provide more specific information in relation to any remuneration we receive as a result of any advice we provide. In line with the spirit of professional disclosure below are some guidelines.

As an insurance adviser holding direct agency agreements with most major insurers, I have the ability to select a commission structure for each new set of policies implemented. Generally speaking, the varying structures reflect the below table (though there a slight differences across each insurer). In the interest of remaining impartial in my advice process, I use independent research from Quality Product Research Limited in Auckland, and dedicated software to provide you an overview of the options available to you market wide.

Additional comments: Commission is generally paid on a percentage of total API (Annual Premium Income), Less GST and policy fees.

Aggregator group: Rees-Thomas Financial is a member shareholder of co-operative Plus4 Insurance Solutions, a Financial Adviser association dedicated to continual professional development, client advocacy and adviser advocacy. Remuneration in the form of 10-20% commission may also pay the business from product providers via the Dealer Group, this is based on production of the group as a whole and Rees-Thomas Financial. The Business can also receive other services or benefits Rees-Thomas Financial from the dealer group such as discounted software and systems.

Costs for Insurance Advice:
Our initial consultation (the Needs Analysis Meeting) is always free of charge.

For written advice, and our second meeting, a fee of $195 p/h +GST depending on complexity (capped at 2.5 hours unless pre-agreed) will apply for:
– the Insurance Statement of Advice we’ll prepare for you
– the Planolitix lifetime cashflow modelling we’ll prepare for you
– your personal Planolitix subscription access

The standard process from that point is for services to be provided at no cost to you with remuneration for services received via commission (this includes support from administrative staff team or advice from Samuel Rees-Thomas regarding any administrative or claim related matters going forward).

Analysis and preparation of an Insurance Statement of Advice, insurance application and underwriting management takes approximately 10 – 30 hours, depending on complexity. Should new insurance/s be arranged as part of my advice to you, commission will be paid to Rees-Thomas Financial by the insurer.

Alternatively, we can provide Fee-based advice by request only.
As an alternate option, we can in some cases operate on a hybrid fee/commission basis, which may result in a 10% discount on some insurance premiums. Our hourly rate is $195.00 + GST.

Fees regularly apply where we are providing advice for restructuring a business’ insurance portfolio with a range of existing policies in place (requiring restructuring), and no commission is paid to Rees-Thomas Financial Services Ltd (i.e., primarily a consulting service).

Costs for standalone Planolitix consultation, report, and advice:
A fee of $300 + GST applies for your initial consultation, your report and subscription/login access. Depending on your needs we recommend review consultations every 1-3 years.

Cancellation of new insurance within two years
All insurers include a clause in their commission payment terms called ‘commission claw-back’. This essentially means that should a new insurance policy be cancelled within two years of implementation – the commission paid to the adviser for their work will be reversed in the form of a bill payable back to the insurance company. Typically, this will cost the adviser business the equivalent of the remaining months of payable premiums until the two-year period is reached.

To protect Rees-Thomas Financial against early cancellation of covers we provide advice on – we reserve the right to charge a fee equivalent to the claw-back fee charged by the insurance company.

All of our insurance advice is based on the implementation of cover for mid to long-term purposes.
If you intend on keeping your new insurance for less than two years, please advise us so that we may work for you on a fee basis rather than a commission basis.

The above terms do not apply to:
– Clients engaging us on a fee basis
– Claims (where a policy is paid out and comes to term)

Conflicts of Interest

We take any perceived or real conflicts of interest very seriously and have a dedicated policy for dealing with such issues whereby we avoid, disclose and/or manage any conflicts so that our client’s interests are placed first and foremost.

For life insurance and health insurance, Harness Insurance Limited receives commissions from the insurance companies on whose policies we give advice. If you decide to take out insurance, the insurer will pay a commission to Harness Insurance Limited. The amount of the commission is based on the amount of the premium.

To ensure that we prioritise the client’s interests above their own, we follow an advice process that ensures our recommendations are made on the basis of the client’s goals and circumstances. We undergo annual training about how to manage conflicts of interest. We undertake a compliance audit, and a review of our compliance programme annually by a professional compliance adviser.

From time to time, product providers may also reward us for the overall business we provide to them. They may give us tickets to sports events, hampers, or other incentives.

Complaints Handling & Dispute Resolution

If you have a problem, concern, or complaint about any part of my service, please tell us so that we can try to fix the problem.

You may contact the internal complaints programme by sending your complaint to hello@harnessfinanical.co.nz or by phoning 04 384 7113. You can also write to us at:

• Harness Insurance Limited
• PO Box 24514
• Wellington
• 6011
• New Zealand

When we receive a complaint, we will consider it following our internal complaints process:

• We will consider your complaint and let you know how we intend to resolve it. We may need to contact you to get further information about your complaint.
• We aim to resolve complaints within 10 working days of receiving them. If we can’t, we will contact you within that time to let you know we need more time to consider your complaint.
• We will contact you by phone or email to let you know whether we can resolve your complaint and how we propose to do so.

If we cannot agree on how to fix the issue, you can contact our external disputes resolution scheme, Insurance & Savings Ombudsman (IFSO).  IFSO provides a free and independent dispute resolution service that may help to resolve your complaint. To contact IFSO:

• Call: (04) 499 7612 or 0800 888 202
• Email: info@iombudsman.org.nz
• Write to: PO Box 10845, Wellington 6143
• Address: Level 11, Classic House, 15-17 Murphy St

Duties Information

At Harness Insurance Limited our financial advisers have duties under the Financial Markets Conduct Act 2013 relating to the way that we give advice.

We are required to:

• give priority to your interests
• exercise care, diligence, and skill
• meet standards of competence, knowledge and skill set by the Code of Professional Conduct for Financial Advice Services
• meet standards of ethical behaviour, conduct and client care set by the Code of Professional Conduct for Financial Advice Services

Privacy/Data Collection

To give our clients the very best advice we need to collect personal information about their financial circumstances. In the digital age that we live in, we take our responsibilities under the Privacy Act 2020 very seriously. Some key points:

• We only collect information relevant to the nature and scope of the advice we are providing.
• The accuracy of this information to our advice is critical, this is where we need your help.

Once collected we will protect any client information:

• You can request any personal information or ask for it to be amended at any time
• We will only share information where it is necessary to do so in providing the agreed services provided. If this is not part of our normal business, we would only consider this with your express consent to do so. However, there are some third parties you may not be aware of that we may need to share your information with such as:
  • Financial Markets Authority (FMA) – the Regulator of financial services in New Zealand
  • External compliance agencies we may engage for quality assurance purposes.
  • To a subsidiary of the Harness Financial Group Limited
• We have policies and procedures for dealing with any data breaches ASAP. Any information no longer needed will be destroyed

You can find out more by visiting our Privacy Policy at our website: Privacy Policy – Harness Financial

Ask Us – We Are Here To Help.

We welcome any questions or queries you have in relation to this important information but more importantly, we look forward to working with you.