It's good to talk

Who understands your health better, you, or your doctor? Analysis of GP reports and telephone interviews requested in parallel on the same applicants for protection cover suggest that individuals are often able to provide more information of relevance to insurers on their health status than their GP.

A recent analysis compiled across eight client studies by Morgan Ash showed, in all instances, less missing information on the telephone interview than on the reports.

The reasons for these findings are not fully understood. Certainly, individuals do not always consult their doctor in relation to medical conditions. Sometimes, even recurrent symptoms will be self-treated or ignored. Some aspects of an individual's health may not be accurately communicated to their doctor, especially lifestyle factors such as smoking or alcohol consumption. This type of behaviour means that medical records may not be complete or entirely accurate. In addition, the completion of a report by a doctor relies on their interpretation of the medical records in question.

The picture is certainly not, however, entirely one-sided. Even for companies specialising in telephone interviews, GP reports remain necessary tools to assess more complex or serious medical conditions. These companies focus considerable effort on developing an optimum balance between the two types of evidence, identifying where customers are able and comfortable to provide accurate information to assess risk, and, importantly, where disclosure levels may be improved to protect the customer.

Most providers are now using telephone interviews in one format or another in the underwriting process. The fastest growing sector is the utilisation of so-called 'little t' interviews to obtain further information from the applicant in relation to disclosures made on their application submission in lieu of obtaining a GP report.

The majority of medical evidence obtained by insurers is in relation to customer disclosures rather than to routine evidence checks issued due to higher sums assured. Telephone interviews are proving a powerful means of reducing the need for this type of medical evidence through well-designed, carefully managed telephone conversations with customers.

In addition to obtaining more information on disclosures, the 'little t' process brings the added benefit of confirming other key application answers with the customer. Studies show that about 2 per cent of customers who say they are non-smokers on their application submission 'come clean' during a telephone interview.

These interviews are proving particularly effective when underwriting income protection, a product which historically has been badly impacted by lengthy underwriting processes. Key risk areas, such as mental illness and back problems, are often not discussed with GPs. In addition, applicants understand these conditions and are generally happy to discuss these in an appropriate call environment.