Insignia’s big Master Trust cost-out deal with SS&C

Mike Taylor

Managing Editor/Publisher, Financial Newswire

11 December 2024

Insignia Financial has taken another key step in restructuring its business and finding efficiencies by entering into an agreement with SS&C Technologies which will see the transfer of more than 1000 personnel as it sub-contracts key functions of its Master Trust business.

Insignia earlier this year implemented its strategy around financial advice including the creation of Rhombus Advisory and has now put in place the structure and strategy for its superannuation business.

The arrangement, when it is formalised, represents a significant win for SS&C in what has become a hotly contested area.

The move, which involves Insignia entering into an Initial Agreement with SS&C to be finalised early next year, will see SS&C providing administration and technology services for Insignia’s Master Trust business.

The company’s announcement to the Australian Securities Exchange (ASX) said that, once finalised, the arrangement would involve Insignia subcontracting a range of administration and technology functions for the Master Trust to SS&C.

“This will include the transition of more than 1,000 people, as well as technology from Insignia Financial to SS&C, to ensure a continuity of service, operations and product knowledge for our members,” the announcement said.

“Insignia Financial will continue to provide servicing and administration functions, including claims and complaints. Subject to signing the final binding agreement, it is intended that Insignia Financial will transition these functions to SS&C mid-2025, and once in their environment the two organisations will work closely together to transform Insignia Financial’s multiple technology platforms and operating models to one, with SS&C’s registry solution Bluedoor at its core,” it said.

Commenting on the strategy, Insignia Financial’s chief executive, Scott Hartley repeated his earlier comments that the Master Trust business had size but not scale.

‘This arrangement will help us convert our size into meaningful scale benefits for our more than one million members over the next few years through lower cost-to-serve, competitive fees for members, and industry leading service outcomes. Members will benefit from an enhanced experience delivered by contemporary technology,” Hartley said.

“Following the successful separation from NAB last month, this is the next step in simplifying our Master Trust business and a critical step to achieve our targeted net $200 million reduction in base opex by FY30. It is anticipated that this model will deliver a simpler operating environment for our Master Trust business, allowing us to focus on areas such as product, retirement offer, investment performance and returns, advice and guidance, while keeping key service and administration functions such as claims and complaints.”