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The Life Insurance Market
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Online processing has come a long way since Legal & General developed their pioneering system nearly ten years ago. It revolutionised the way we processed business. Looking back at what has been achieved, it is now more efficient to submit applications and quicker to get customers on risk. However, have we made as much progress as we could? Unfortunately not.
Friends Provident’s eSelect launch in 2003 was a radical step forward; it offered many new features including offering special terms online, enabling advisers to issue underwriting requirements and, most importantly, eSelect virtually eradicated the need for phone or paper communication. It gave us control from start to finish, with emails sent whenever the status changed. It was an impressive development, but what is disappointing is what followed. Other providers launched and tweaked their systems but for years none deviated much from Legal & General’s original design. Recently, the likes of Bupa, Fortis, Royal Liver and Legal & General have taken inspiration from eSelect and even improved on it, but they are the minority.
However, one crucial customer service point has been ignored. No-one has been wise enough to follow Friends Provident when it comes to online trusts. Trusts are so important, but the process is time-consuming for all concerned because of the paperwork and many clients (and dare I say advisers?) are put off. If all insurers can provide an online trust that dramatically simplifies the process, virtually all clients would make use of it and more families would benefit.
But why stop there? The role of an online system should not cease when a plan starts; systems should enable better management of policies throughout the term. They should provide notifications to the adviser when clients have missed premiums, changed address, lapsed the cover, changed their name, called to alter their cover, made a claim…the list goes on. And they should also enable us to re-instate cover, update addresses and receive updates on claims. It should be an extension of an intermediary’s own client management system, and integrate with it, so that paper communications become obsolete, the need to make calls is reduced and processes become less time-consuming. With ever-more focus being given to improving persistency rates, providers need to develop systems that help intermediaries achieve this.
Some providers are looking at some of the aforementioned features, but from past experience I am concerned that it will be years before we see any real changes. We need investment and innovation, rather than the usual tinkering at the edges. Introducers have differing needs, so the key factor that providers need to build into their systems is flexibility. They need to ensure they can meet the needs of intermediaries now, but also ensure their systems are designed so that changes can easily be made to meet future needs too. So come on providers; please stop delivering online systems that do half the job and instead develop true e-commerce propositions that meet the needs of your customers both before AND after plans are on-risk.
Emma Prescott
Life Office Relationship Director
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