Working in financial services can sometimes feel like walking down a very long and winding road, a road where somebody keeps changing the signposts.
Although we at least have a compass to help point the way to the destination.
In an industry where constant regulatory and legislative pressures are making us re-evaluate how we interact with our customers, is it any wonder it can seem hard to actually make things as simple as we believe they should be?
It makes perfect sense that we try to make insurance clear and easy for customers, which is usually translated to mean less paperwork, but then there is a requirement that we have to give customers all the information up-front, which inevitably means more paperwork.
Whilst the amount of information we have to provide may be set by the FSA, we are in the best position to ensure we make it customer friendly.
We should not underestimate the intelligence of our customers. Provide them with the basic concepts of life cover, critical illness cover and income protection and they will understand what each does and why it is useful for them. They will usually agree that income protection is the one product they should really have in place.
The difficulty seems to come when we inundate them with key facts, quotation, policy conditions and statement of demands and needs, all before they’ve completed the application form.
Of course we keep on walking down the road, and the industry is working hard to improve consumer understanding. From the specific action of implementing the revised ABI CIC definitions, to more general changes to literature and the wording used for questions in the application forms.
What’s very clear is that these won’t address the issues of customer understanding overnight and as an industry we have to acknowledge that. Taking non-disclosure as an example, no matter how big or how clear the changes that are made to an application question six months ago are, those changes aren’t going to have an impact on the level of non disclosure statistics seen in the next six to twelve months. Simply because the claims are mostly on policies sold before the changes were made.
We should look at change as a positive. As an industry we need to keep up with the needs of our customers and their lives and we should make sure that when we implement any changes that we improve the customer experience. This is what gives our journey purpose rather than letting it become a ramble.
The views expressed in this article are those of the author and do not necessarily represent those of IFAonline or Incisive Media.IFAonline
Headed by Ben Palmer and Edward Park
Consults on regulation and innovation in green finance
13 studies begun since April 2013
Start with customer requirements