Protection  

Value-added services will be key in providing fair value

  • Describe the impact of the consumer duty on value-add services offered by providers
  • Explain how providers should treat vulnerable customers
  • Identify when they should be proactive
CPD
Approx.30min
  • Availability – is the support easily available to those who need it? Even if services are clearly explained at the point of purchase, it is very likely that the customer will not remember many years down the track. Technology has a part to play in keeping services in the customer’s sights, but requesting support at a vulnerable time can be difficult and many people do not do it. Insurers who proactively offer support to those they expect need it, such as claimants, can make the difference between the customer receiving the support they are entitled to or not.
  • Comprehensive – is the support wide-ranging enough to meet the vast amount of needs that customers may have? Very often services address a limited range of needs or have significant exclusions, leaving many customers with no support at a very difficult time. 
  • Lifetime – is the support available through the life of the policy, even if there is no claim event? Only a small proportion of customers will ever need to claim on their policies, and while support available alongside the claim can have a huge impact, this support can be just as beneficial at other times, and in some cases reduce or negate a claim altogether.

Communicating

Providers have a duty to ensure that customers are aware of all aspects of the product available to them. Simply including details in a leaflet or website is not enough, regular reminders at appropriate points is very important.

We find that customers are often surprised and delighted to receive a call from us, even though they have consented to their insurer passing on their contact details. Many say that they would not have accessed the service otherwise.

For me, this demonstrates the importance of clear and regular communication about the services available to ensure that customers are aware of them and are able to use them.

Advisers also have a key role in communicating the financial and non-financial aspects of policies not only at purchase – ensuring that customers make an informed choice – but also at appropriate interactions during the life of the policy, so that services can be accessed as needed, and the true value of the policy is appreciated. 

Measuring value

It is not always easy to measure the impact of support services as the impact is often intangible, for instance how much is it worth to have a diagnosis confirmed or be given advice on dealing with the side-effects of an illness? 

Many providers publish customer satisfaction survey results, net promoter scores, client testimonials, and some take to Trustpilot to share their feedback independently, all of which demonstrate the value that customers place on the service received.

All of this gives a measure of the impact made by the service.

We measure the impact of our service on our customers, and we have found the following stats have been really compelling: 66 per cent said they value being aware of everything available to help them; 48 per cent appreciated having the right intervention organised quickly; and 18 per cent said they were helped to stay in or return to work.

As well as measuring the quality of the service provided to the end user, it is also important to understand whether the service provided affected the customers view of the hosting insurer – 95 per cent of our customers say it does, and that is really important for the sponsoring organisation to know.

While the FCA consumer duty principles are aimed at financial products, value-added services are now an integral part of the majority of protection products, so it is particularly relevant here.