Lewers Research client engagement director Suela Qemal said consumers using online comparison websites or going direct to life insurance websites are usually part of a previously inaccessible and disengaged segment of the population who may not be aware of the importance of financial advice.
“Advisers can use these opportunities resulting from digital engagement as trigger points for tailored marketing communications, aimed at educating and advising. This can include assistance with understanding cost comparisons, guidance on super policy through to an insurance audit amongst clients that already have a life insurance,” she said.
Ms Qemal said insurers must provide advisers with digital tools to improve client engagement if they are to stave off consumers going direct for their coverage.
“In a digitalised world, consumers are taking cues from other industries like telecommunications, banking, retail and entertainment. They are expecting the same interactivity in all other aspects of their lives, including life insurance. Increasing client engagement should be seen as a key focus across life insurance providers and financial advisers,” she said.
“For life insurance, while the direct channels are complementary to the adviser business model, the rapid growth of this channel requires strategic focus from life insurance providers and financial advisers.”
sadly, they will not have the knowledge to see bias in ratings. Definitions in trauma and income protection are everything! We as a professional group of advisers must get on the front foot here…
Direct channels are complementary? I don’t think so. Direct channels are deliberately competitive. Insurers are using direct channels to dupe people into buying junk insurance that doesn’t pay claims.
This is the LIF agenda. It’s not about reducing commission costs and it’s definitely not about churn. Those are minor issues. It’s really about making it harder for consumers to get professional advice, so they buy junk products which significantly reduce claims costs.
Adviser associations need to be publicly lobbying about the dangers of junk insurance.
I am surprised that consumers aren’t required to have a university degree to understand what insurance is about before they can determine the amount and type of cover necessary. Surely this is something ASIC should be looking into.
and according to some stat (anecdotal or real?) that was quoted somewhere last week, 50% of these policies lapse after 2 years…….so much for clients best interest