Owain Thomas finds that, sometimes, driving a Ford Focus rather than an Aston Martin is a good thing
“At Universal Protection we had a very successful product which clients could buy in any combination, and there were some customers who came out with pretty elaborate permutations, but by far and away most people chose really simple options. If you give people too many options they tend to think it’s complicated so I think the simplicity is putting together something that customers understand and are willing to pay for.
“It’s not necessarily about making it cheaper, but you have to make sure you don’t make it too complicated,” he added. That takes us smoothly on to an issue that has been bubbling along in the background over the past year; the Treasury’s proposal around simple financial products, particularly an income protection one.
While it would be fair to say progress on this road has not been swift, it is at least stirring a debate within the industry around both the concept and how it should be implemented. The Treasury itself has declared that simple products should be capable (but not exclusively so) of being sold without advice, while recent research from the ABI found consumers would prefer a cheaper cut down product compared to a more expensive but comprehensive version, or just simpler wording with a greater number of documents.
All this has provided food for thought for Nick Jones, brand and marketing manager at Exeter Family Friendly, who believes the industry must do more to address simpler products. “There are insurers who think their products are simpler than they actually are,” he said. “We’d be one of those insurers reputed as selling simpler products but I think we’ve still got more to do on it, so where does that leave other people?
Down to basics
“The basis of simple products is there but we’ve all got work to do to make them more easily accessible – it’s great having a simple product but if that only reaches the small part of the population it currently does, that’s not really what we’re in it for,” he added.
Jones suggested that for all the honourable intentions, offering only the best product available was perhaps not a responsible or logical position compared to other walks of life. “When you buy your first car you don’t say ‘I want an Aston Martin DB9 and I’m not going to buy any car until I get that’,” he continued.
