How technology is changing the sector for the better

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Protection Trends - March 2015

Technological innovation is the driving force behind most industries and none more so than protection, with underwriting software, online tools and wearable devices all on the agenda for providers trying to increase sales and market share.

Insurers, distributors and developers spoken to by FTAdviser are all positive about the future of the sector in spite of its well documented issues with consumer engagement, but warned that those not embracing this change would quickly be left behind.

One of the most recent updates came from Finance and Technology Research Centre, whose ‘quality adviser’ tool now features business protection and relevant life product comparisons. The firm’s director Ian McKenna explains that they are not alone in trying to make it easier for advisers to navigate more complex quotes for clients.

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“Worthy of note here are Direct Life and Pensions who have developed ‘quote plus’ to compare menu plans against single solutions, while iPipeline’s ‘solution builder’ goes one step further to help advisers compare costs using a mix and match approach, with menus and stand-alone policies.

“It seems like a simple enough development, but other protection businesses would do well to look at these systems and develop their own digital solutions to help advisers arrive at the optimal level of cover at the lowest cost.”

Underwhelming underwriting

Mr McKenna opines that ‘underwriting’ is almost becoming a dirty word – at least to the end consumer – with some companies making a virtue of products with no underwriting required.

“Speeding up the underwriting process should certainly be an area of focus for providers. But more than that; providers must make the process much more visible to advisers and end customers,” states Mr McKenna, adding that “the reality is that many providers have ‘Victorian’ processes replicated online.”

Underwriteme is one such advancement that has the potential to revolutionise the industry’s outdated processes, with the firm’s head of sales and marketing Phil Jeynes explaining that technology has a major role to play in getting better engagement.

“Customers are put off from buying when they are presented ‘off the peg’ quotes online, which turn out to be meaningless in many cases, failing as they do to take account of a person’s individual background and circumstances.

“Intermediaries, too, are often reticent to really sell protection as confidence in the cost they’re showing their customers is less than total. In a world of one-click purchases, a system of logins, pop ups and diversions feels hopelessly inadequate.”

Underwriteme is a technology company which has developed a fully online underwriting portal. Partner provers offer advisers to use this portal when applying for cover, with most reporting that six in 10 clients can get an instant quote based on their responses.

As at September, a total of seven firms were signed up with the firm, with one of the early adopters, Scottish Provident, reporting a 30 per cent increase in new business after employing the new application process.