Lessons and challenges in group insurance



Our online self-service platform, CLASS, celebrated its tenth anniversary and in that time it has grown to cover around 9 per cent of all Group Risk policies in the UK.

We also retained our position at the pinnacle of our industry by the three measures of Swiss Re’s annual Group Watch report: in-force premiums (i.e. market share), companies covered and people covered.

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While we are proud of our accomplishments, it is important not to get caught in a bubble. In the largest of the three traditional UK Group Risk markets, Group Life Assurance, there are 41,323 policies registered with HMRC.

We have had the largest slice of this particular pie for many years, but when you consider there are some 1.8m employers due to go through pensions automatic enrolment between 2015 and 2018 it becomes apparent that this pie could euphemistically be called “fun sized”.

Stepping away from the metaphors and euphemisms and speaking plainly, growing an undersized market was one of our main aims when developing Simply Class Group Life Assurance.

The launch was a success from my perspective in the marketing department. There was a platinum rating from industry pundits (putting the product in the top 7 per cent of all they had reviewed), comprehensive coverage and consistent, multi-channel communications.

However, there is more to a product launch than the fanfare in the first couple of weeks. Behind the scenes, we are already seeing conversion rates for Simply Class quotes in the region of 10 per cent, compared to 2-3 per cent for our “standard” business in the sub-50 lives segment.

The 10 per cent could even be higher if we take quotations which are currently under consideration by employers into account.

We believe the key to this improvement is getting the right messages in front of decision makers in our target market.

We produced a video demo showing advisers just how straightforward the system is to use, and have given them supporting literature highlighting the features and benefits of the product which they can share with their clients.

Explaining the tax efficiencies, removing the need for medical underwriting and putting premiums as a percentage of salary costs on the quotes are also working – costs were always very much less than most employers’ perceptions!

These evolutions followed in direct response to feedback we got from employers in the sub-50 segment during interviews for our planning stages: if we can get the costs in front of them, the decision to buy is a no-brainer!

Our first challenge has been distribution. Under half of the adviser firms that regularly engage with CLASS have quoted for a Simply Class Group Life Assurance product.