Posted: 23rd May 2013

Packaged accounts are currently under increased regulatory and media scrutiny. Firms must now:

  • Assess customers’ eligibility for each insurance policy and inform the customer if they are not eligible to claim
  • Provide an annual eligibility statement setting out eligibility criteria for each benefit and informing customers about areas for which they are no longer entitled to claim

Anyone who has bought or sold a packaged account knows that getting customer experience and compliance right is a challenge. If not met, the sale could result in a mis-sold product or a disengaged customer. Simply stating that a sales process is unadvised might be compliant, but can be meaningless to a customer. The same applies to listing the features of products, as opposed to asking questions that establish the customer’s real needs and then highlighting relevant benefits.

There is good news, however: selling non-advised products compliantly with good customer outcomes and a great customer experience is possible. Firms should be confident that they can achieve the holy grail of consistently good compliance and customer experience across all channels. It involves being aware of the challenge and then developing employees to work towards best practice, refreshing and embedding these practices and behaviours over time.

Key to getting the non-advised sales process right:

  • First impressions count: ensure your firm’s interactive voice recording system or website has the option to open a packaged account or make an appointment
  • Signpost to make sure customers know how long the sales process may take and what is involved
  • Ensure your advisers do not veer into giving advice: feel free to repeat and recap that the customer must make the decisions for themselves with the full options in front of them
  • By asking customers about key parts of their lifestyle – holidays, whether they have children or pre-existing medical issues – your employee can work out which insurance product information is relevant and which is not. This can dramatically reduce areas of questioning or rule out the product all together
  • Make sure the staff member selling the product understands that the customer may get bored, confused or be surprised at the in-depth information they are required to provide. Ensure employees have a comfortable style to engage  and put customers at ease

It is clear that eligibility should be determined by the firm and not the customer. This is determined on an individual cover basis, and the firm must ensure it has clear evidence or an audit trail to back up the assessment made. Firms are also on notice to make a number of other improvements:

  • Remind customers to notify their provider if their circumstances change
  • Proactively notify customers who no longer meet age criteria
  • Identify duplicate sales of insurance policies. This is particularly the case where the product provider sells similar stand-alone policies to those sold with the packaged account

Firms must refer to the new rules when opening packaged accounts and be proactive in ensuring these measures are in place. However, firms should balance updating regulatory compliance practice with a refresh of skills and attitude to provide a positive customer experience.

Achieving consistently good outcomes and good customer experience for customers is within firms’ grasp with a dual approach to regulatory and staff development in the non-advised sales process.

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