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Policy Servicing: What to do now and how is Covid changing things

We well know that calling the provider, it doesn't matter who or what discipline, the chance of getting a 100% accurate answer is unlikely.

Tuesday, August 24th 2021, 12:45PM

by Jon-Paul Hale

They do a good job, don't get me wrong, but the newest staff are usually the ones in the call centres and interesting answers are often given - I've been hearing this for 20 years from across the industry.

It's a problem and one that is difficult to solve without stifling career paths and increasing costs. The management of the issue is more the internal approach. Correct and guide when astray, that's how people develop.

So what does this have to do with adviser servicing?

Quite a lot because we will be presented with new challenges as we move onto the new playing field - Covid-19 is already driving some of it.

One will be having to disturb that client you haven't talked to for a decade, and that will likely need someone at a provider to help out with their policy, or they have called you because of Covid.

Gone are the days of just flicking off a letter after the insurer's renewal letter and job done - if that happens at all - the insurer's renewal letter being enough for many advisers.

There is a requirement that ongoing servicing of your client is going to need to be done. Now the question here is what does that look like?

For one, it is taking reasonable steps to talk to the client. And that can be hard when they move and don't provide you with updated contact details - we all have some of those.

I have one client where the best place to catch them is Snapchat. The problem is that platform is designed to delete all traces of the conversation as you go. So has some serious professional issues.

Another client I located via a chance meeting in a Facebook group under their married name, "umm...I think I know you" type of chat. Yes, they had moved, and all contact details had changed.

We are going to have to do two things when we meet with clients:

1. Explain what servicing is and what the industry/regulator expectation is.
2. Gain a client's commitment to what that servicing looks like for them and what their obligations are to you.

It should be part of your scope of service; the bit about them keeping you up to date on contact details won't change, and that's an issue.

From my time as a BDM, plenty of advisers out there say that doing this will be a full-time job. They have client bases in the thousands and have worked on a catch and release basis. So they have a massive challenge.

And that is just for the clients that have had advisers. Something like 40% of the population doesn't have life insurance.

The other challenge is the 10,000 advisers needed to cover client bases of around 500 people to cover the population. The technical limit the majority of advisers can service and work with to achieve the requirements.

The reality is that even when you have an active programme for reviewing clients, only a quarter to a third typically respond to reviews in any particular year.

This last year has been different with Covid, but that will settle back to where it was in time.

So what's the answer?

Technology, we're going to have to be more innovative on client contact and collection of data.

Things like:

- Apps that hold client info so the client can update changes, SX and nib already do this to an extent.
- Tools and apps that trigger alerts and replies to the adviser business, privacy issues in this too.
- And automatic data collection and collation on contact.

I see the adviser sending out pre-meeting forms requesting information but my personal experience with this has mixed results.

The critical thing is that when the compliance manager or regulator comes knocking on the door, you need to have a plan for servicing your clients.

So add that to the to-do list with the rest of the things you have to get done while we face looking out of the imposed boxes we have presently.

Tags: client engagement Jon-Paul Hale Life insurance Opinion

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HSBC Premier 4.49 2.19 2.45 2.69
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Kainga Ora - First Home Buyer Special - 2.25 - -
Kiwibank 3.75 ▲3.80 ▲4.00 4.34
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The Co-operative Bank - Standard 4.40 ▲3.35 ▲3.75 ▲3.99
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Last updated: 23 September 2021 8:11am

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