The Consumer Duty and the continuing cost of living crisis are among the key challenges facing advisers at the moment.
But Health & Protection has found advisers are rising to these challenges by hiring in and developing talent within their organisations and embracing new technology to reduce admin and adapt processes to meet the ever-evolving needs to today’s customer.
Customer outcomes
For LifeSearch chief executive Debbie Kennedy, demonstrating customer outcome is key to fulfilling the requirements of the duty.
“Being able to evidence this in a way that is transparent and clearly understood will be the next step,” she said.
“The FCA wants to see data-led outcomes so firms need to be thinking about what their key customer measures are and how they can evidence these.
“At LifeSearch, data is a vital asset in driving our focus on distribution quality and our recent appointment of a chief data officer reflects the criticality of data and the importance of insights to our business.”
Alan Lakey, owner of Highclere Financial Services, agreed that the regulator’s last flagship policy is causing extra work for the firm.
“Like all firms we are arranging systems that enable us to not only meet the Consumer Duty requirements but also prove to the regulator that this is being done,” Lakey told Health & Protection.
Talent and purpose
But with unemployment plummeting to levels not seen since the mid 1970s, holding onto talent is also high on the agenda for firms.
“Talent retention is critical, so we’ve focused to ensure our culture thrives and we’ve continued to invest in our people and their opportunities to develop and progress,” Kennedy continued.
“LifeSearch has always recognised the benefits of a flexible working model and has operated a hybrid approach for the last eight years, so we have been well placed to respond and adapt during the pandemic and beyond.
“What has always been key is to ensure that we can create that sense of community and belonging for everyone. That’s why purpose-led companies will perform better. Our purpose and vision are to protect the UK properly which our employees are clear on how they can contribute and make an impact.”
Engaging younger people
Charlie Cousins, founder and director of Hooray Health & Protection, admits it has been a struggle to recruit ready-made talent.
“We have been focused on growing the team recently but when trying to attract the best talent in the market, there has been a lack of experienced consultants looking for new business roles,” Cousins told Health & Protection.
“However, one way we have responded to this is through our fantastic success hiring younger people and graduates and training them up the Hooray way.
“They are eager to learn, and keen to get started in the industry – each one of our new recruits are training and studying for their Chartered Insurance Institute (CII) exams and wanting to get the most out of the opportunity.
“We strongly believe in having a wide mixture of skills, talents, and people in our team – all bringing different experience or character to the business.”
And Cousins added that by hiring from a younger people and embedding them into the business it was helping them to prepare long-term and proactively tackle the challenges when looking to hire experienced employees.
However for advisers it appears finding ways to bring younger people in as new customers are just as important as recruiting them in.
“A key challenge is engaging our younger customers at the earliest stage,” LifeSearch’s Kennedy noted.
“This means redesigning a process that’s dynamic and tailored for different user groups, their expectations, needs and schedules. We have technology to support the modern buyer and we know it’s possible.”
But underpinning all of this work to engage new customers and talent and tackle the Consumer Duty is the threat to adviser businesses posed by the ongoing cost of living crisis.
“We are very aware that customers will be scrutinising spending, particularly on items they consider non-essential,” Kennedy continued.
And she added the firm’s advisers were prepared to have these conversations and guide consumers to stay protected.
“Protection insurance offers both peace of mind and a vital lifeline in times like these to protect a family’s income that could otherwise be devastating if impacted due to ill health or injury in the midst of the cost-of-living crisis,” she added.
Situation only likely to get worse
Highclere’s Lakey agrees – adding the current economic situation will only get worse in the short-term and affect clients’ appetite to protect themselves adequately.
“This filters down from the anticipated fall in house prices which will cause many to sell up and rent or downsize,” he warned.
“We know from experience that a worryingly high percentage of consumers do not value their family and mortgage protection and the current travails will create further pressures.”
But Lakey noted that the firm is tackling this head-on and helping customers understand their coverage and where they may be able to reduce their outlay.
“We are dealing with this proactively by reviewing every protection plan and writing to every client where we are able to offer reduced premiums,” he continued.
“Factors include where budget plans may prove more sustainable than the more comprehensive versions and where the mortgage debt has fallen lower than the current policy sum insured.
“Personal finance and personal loans remain in vogue so many will react favourably to age-costed income protection plans.”