Existing case tracking methods for new business are inefficient and a drain of advisers' time. Kerry Nicolaides outlines some alternatives
At a time when the housing market is booming, normally a good bellwether for protection, it may seem surprising that Swiss Re's 2014 Term & Health Watch reports the protection market contracted substantially in 2013.
Looking at the process an adviser has to endure to establish new life policies, it is no wonder that many adviser firms are increasingly outsourcing the sale and administration of their clients' protection to specialist advisers.
Most adviser firms have redefined their business models and client servicing structures post-RDR, and are continuing to evolve these. But while ‘protection' might have escaped the Retail Distribution Review, at least for now, it hasn't meant that advisers are not applying the same criteria to measure operational efficiency and costs incurred as they evolve their servicing models.
An onerous task
This has cast a spotlight on the cost and resource adviser firms spend on processing new protection business. The inefficiencies and inconsistences in pipeline tracking methods stick out like a sore thumb. Putting aside those proposals submitted electronically that can go on risk immediately, the time and costs involved in pushing through an application requiring underwriting is onerous, to say the least.
Advisers are crying out for an industry-wide effort to improve and streamline a better approach to pipeline tracking. The diverse approach by providers in delivering pipeline tracking messages has led to a lack of clarity and increased frustration. Adviser appetite to improve tracking processes has never been more prevalent.
Part of the solution should be a complete overhaul of online underwriting rules, ultimately leading to less cases being referred for manual underwriting and quicker turnaround times. However, this will not solve the case for those applications that do need to go through a full manual underwriting via their GP.
Adviser sentiment is, almost without exception, that the existing set of tracking processes do not provide the level of information the adviser needs to provide effective customer service. Another stumbling block is that even systems do not provide sufficient information on what will happen next.
If you go to a client and tell them something has happened, invariably they respond: "So what happens next?" Advisers and paraplanners know this, but if not, given this information they will pick up the phone to ask for it.
Simple updates such as: ‘Signed application form has been received' with the relative date, will inevitably lead to the adviser picking up the phone to ask: "What is outstanding?" followed by "What are your next steps?" followed by "When will you do it?" Finally, they will wonder: "What do you need from me or my client?"
Value of real-time tracking
In practice, advisers find new business and on-going tracking to be one of the most time consuming and costly exercises of their day-to-day business. Providing advisers with accurate, real-time information directly to their main business hub on the progress of their new or existing policies will undoubtedly encourage further business relationships, reduce both time and cost to the adviser firm and lower the amount of adviser outgoing calls to providers' processing teams. This will liberate provider staff to focus on business generating tasks, reducing operating costs and increasing profitability.
Another great way to supply such updates is via a mobile application, where the adviser could receive real-time push messages directly through to their mobile device.
Zurich has given a great example of what can be achieved with its M-Office app. While the app is a great step forward, a number of advisers have said they would like to see a single aggregated view of all their pipeline business across all insurers, used in a single place with the information delivered in a consistent style.
Equally, in a world where consumers are increasingly used to receiving information on virtually everything via their mobile devices, isn't it time to create a mechanism to electronically communicate the latest progress on protection apps to clients? Apps would appear ideally suited to this, although they should probably allow the capacity for co-branding.
With more and more advisers delivering online information portals to their clients to provide a digital summary of their financial life, via their client management systems to both traditional websites and mobile devices, such services are an obvious natural extension.
In the investment market, there are increasing signs that traditional life, pensions and platform providers are being out manoeuvred by new entrants either from other countries or online services, for example Momentum's acquisition of MoneyHub and MoneySupermarket's purchase of OnTrees.
While there is increasing evidence of life companies building direct to consumer protection propositions their traditional distribution partners deserve equal support. This should mean a radical transformation of the processes and support provided as part of the new business process must become a priority.
Kerry Nicolaides is principle consultant at Finance & Technology Research Centre (F&TRC)
