While age old problems connected to GP reporting and overly complex processes continue to obstruct protection underwriting, one adviser has told Health & Protection he is ‘pleasantly surprised’ at the speed of provider decisions.
In the wake of Holloway Friendly issuing eight underwriting promises to advisers last week, Health & Protection spoke to advisers for their thoughts on where protection insurance providers are performing well and where they could do better.
Alan Knowles, co-managing director at Cura Financial Services, tells Health & Protection there are definitely some providers who are far stricter on underwriting and some who seem to be targeting clients with minimal disclosures.
“They wouldn’t necessarily be the providers you would think either. Some are very strict on customers with anything remotely complicated – and even some that aren’t that complicated,” he explains.
Reinforcing ‘computer says no’
Though Knowles points to a “big bugbear” where pre-sales decisions are made far too favourable or where advisers are forced to use an online presale tool rather than being able to discuss a case with an underwriter.
“The latter just reinforces the ‘computer says no’ message that advisers can be presented with by some providers,” he continues.
“Incorrect presales and where they are given too favourably just leads to upset clients, who could have never got the terms originally indicated – it wastes everyone’s time.
“But, some providers are doing very good things on underwriting and I’ve seen some exceptional results from some providers recently.”
Pleasantly surprised
Alan Lakey, director at Highclere Financial Services and CIExpert, tells Health & Protection he has been pleasantly surprised with some providers’ underwriting performance.
“I’ve done some cases recently – Royal London and Scottish Widows – the underwriting’s been good,” he says.
“The medicals that were required were done within a week which did surprise me because I’d heard that there were some issues with this – one with Square Health was done two days after the application which was pretty impressive.
“The problem I have is I don’t do the volume business that the Future Proofs and the LifeSearches do – so I can only see a small bit of it if you like.
“And people like LifeSearch and Future Proof have got a good system of chasing these things up on a regular basis which is a lot harder for a small firm to do because you don’t have a dedicated person and you’re trying to do five things at once.
“But certainly, what have I experienced in the past month has been better than I thought.”
Size matters
And it seems the scale of their operation does benefit firms like LifeSearch.
Justin Harper, chief marketing officer at LifeSearch, told Health & Protection: “From a LifeSearch perspective, we have a dedicated support team who help our customers through the application and underwriting process.”
Harper maintains that taking this responsibility from its advisers gives it a focused resource with greater familiarity with different insurers working practices, and regular contact with underwriters and business development managers.
“So, not only a strong informed position to understand rationale, but we’re able to constructively challenge and at the times overturn insurer decisions, in favour of the customer,” Harper continues.
“Furthermore, we have a dedicated special risks team of advisers who possess an experienced and stronger understanding of typical chronic conditions, insurers’ underwriting philosophies and working practices and limits.
“We have negotiated special arrangements with selected insurers, and access to underwriters to talk about common sensitive and often more subjective and difficult disclosure issues – such as mental health, alcohol and drug abuse.”
Meeting commitments
Harper adds that while other providers have made similar promises to that made by Holloway Friendly in the past, the firm stands a good chance of meeting these commitments.
“Given the Holloway model of one IP product, relatively low volumes and a new platform, and importantly a common-sense underwriting philosophy, they’re in a good position to live up to their promises,” he says.
“The human touch of explaining their decisions can certainly help, although at LifeSearch we’re happy and able to pass that onto clients ourselves as we can then explore alternatives.”
Limited pool of underwriters
But Harper warns a further issue is that the sector only has a limited pool of experienced underwriters and when there is a churn in the market created by people moves, this can present disproportionate challenges.
“Also, at times of higher claims, it is the expert underwriting resource that is dropped into support,” he adds.
“Replacing expertise and experience takes time. We’ve seen that with a couple of insurers, end of last year and early this year.”
Though Harper also highlights that a number of insurers are proactively talking about their flexibility, offering access for support teams to speak directly with underwriters and understand and challenge rationale for evidence and decisions.
“BDMs are also invaluable in helping escalate issues,” Harper says.
“We’re finding insurers are far more transparent and open about service challenges by discussing them with us and what they’re doing about them and, at least, warning us at point of contact and setting expectations about turnaround times.”
And according to Harper, the sector has moved to now seeking medical evidence with reports very much the last resort for everyone concerned.
“A few insurers are open to challenge about whether we need to seek medical evidence, and what alternatives might be acceptable,” he adds.
“Insurers regularly review, update and share their underwriting guides
“We are seeing and welcome the use of exclusions, particularly reviewable exclusions, rather than ratings, by several insurers. Holloway mention this in its promises, as does Cirencester Friendly and LV=.”
GP reports
While GP reports may increasingly be seen as a “last resort” this is an issue that continues to beset advisers, according to Roy Mcloughlin, director at Cavendish Ware.
“Underwriting has got challenges. I’d like to say there has been improvements but just sometimes, we’re going around in a proverbial circle,” Mcloughlin tells Health & Protection.
“It’s not all insurers’ fault. There are clearly bottlenecks with GPs. What can we do about that? We can ring them, cajole them. It’s a really hard subject.
“We’re obviously trying to encourage insurers wherever they can not to write out the GPRs. I don’t know what the solution is to that because how does that get any better?
“That’s the main issue – the bottleneck of GPRs.”
Absolute nightmare
Naomi Greatorex, owner of Heath Protection Solutions, agrees, adding: “GP reports are always an issue for us. GPs and further information are always an absolute nightmare.
“And we get that a lot. That’s not the underwriter’s fault but I’m just wondering are there other ways to get that further information because that for us, we wait for the GPR, it can take months to come back and the underwriter has to review it and then they need further information and we’ve had a few of those recently.
“Then it’s back again in their court and I find causes real delays. That backwards and forwards is really bad and I’m not sure how you solve that, but it causes a lot of problems.”