A guide for advisers
Distribution quality
Our distribution quality guide has been designed to help you spot opportunities to improve the efficiency and profitability of your business. It shows you how you can make meaningful change and improvements through additional training, system and process changes, with hands-on support from our team of experts. Our aid illustrates a clear, objective focus for each stage of the sales process. From lead generation right through to retention, with the common aim of improving your customer journey, quality and profitability of your protection business.
What and why?
Not taken up
Lapse rate
Introduction
Cancelled from inception
Trusts
Adviser upskilling
Value added services
Cancelled from inception (CFI)
About
How to improve distribution quality
Business benefit
Cancelled from inception is when a policy is fully submitted and activated but is cancelled before the first payment is collected. This can have a damaging effect on your business.
Keep track of all of the policies that have been cancelled. You'll see exactly what type of policies your clients are cancelling and be able to put prevention plans in place to stop it from happening in the future.
By making sure fewer policies are cancelled you'll have a loyal and trustworthy client bank. As well as more revenue for your business.
Put a defined follow up process in place to make sure your clients understand the policy that’s been arranged. Also, make sure they’re aware when the first payment will be collected. This could be a simple email or a conversation over the phone. The earlier the better.
1. Post sale
4. Review
5. Retention
6. Affordability
2. Collect
3. Value
Things to consider:
Regularly review and update your sales processes so that they continue to suit your client bank and maintain relevance.
Put a defined retention process in place that reminds clients of the key benefits of their policy and why the cover was taken out in the first place. This should include the need for the protection, what the protection the policy provides as well as the value added services that are available to them.
Make sure every customer can afford the protection they’ve purchased with a financial review. It’s a good idea to align payment of their premiums to that of their salary or other regular income.
Remember to collect your cancellation data on a monthly basis - anything from the customer demographic to each product line. This will help you identify any cancellation trends and allow you to put processes in place to stop it happening in the future.
Spend time with your clients discussing the importance of value added services and make sure they fully understand the value of their protection policy. By showing your clients the immediate benefit they receive through their policy without needing to claim should also help to reduce cancellations.
A lapse is when a policy is submitted and activated but cancelled after the first payment is collected. Lapses can harm your client relationships and business performance.
Keep track of the amount of lapsed policies and the reasons for them. Put plans in place to stop policies lapsing in future and develop a client contact strategy.
With less policies lapsing you'll retain a larger client bank of loyal customers leading to increased revenue for your business.
Put a defined follow-up process in place to make sure your clients understand their policy. This could be a simple email or a conversation over the phone. The earlier the better.
Developing a client contact strategy will help you build stronger relationship with your clients. Whether you choose monthly, bi-monthly or quarterly check ins, a contact strategy will provide you with the opportunity to be kept informed of any changes in their lifestyle which may mean they need a protection review.
When reviewing a client’s protection needs, always remember the client may be able to increase their existing cover through exercising a guaranteed insurability option, as opposed to writing a new cover altogether.
Polices sold with a free gift or incentive can be great for initial retention. However, policies with a high value incentive often attract clients for the wrong reasons, generating a large number of lapses once they’ve received the gift.
Remember to collect your lapse data on a monthly and year by year basis to help you identify any trends. Then put prevention processes in place to try to stop it happening in future. Pay particular attention to both two and four year lapse figures.
Placing policies into trust adds value to the advice process. It means that the money will be paid to the right people and at the right time, free from inheritance tax. Placing policies into trusts is also a great way of increasing the likelihood of referrals.
Placing a policy in trust gifts the policy to the trust beneficiaries and moves the proceeds outside of the policyholder's estate. This can help your clients maximise their benefit when it matters most.
If it's right for the client, recommend that a policy is placed in trust and make sure they're aware of how it can benefit them and their family.
Because of the benefits they can provide your clients, placing policies in trust can lead to greater customer satisfaction and an increased likelihood of referrals.
Policies placed in trust are less likely to be cancelled because your clients will have an increased understanding of why the protection was arranged and who it’s intended to benefit.
1. Less cancellations
4. Secure
5. Inheritance tax (IHT)
6. Referrals
2. Retention
3. It's easy
Placing a policy in trust will mean that the right money is paid to the right people at the right time.
Any claims payments from a policy placed in trust will be free of inheritance tax as the policy sits outside of the settlor’s estate.
Appointed trustees are a good source of client referrals as this provides an opportunity to arrange subsequent meetings to discuss their protection needs.
Clients that have policies placed in trust are more likely to be repeat customers. The use of trusts adds value to the advice process and can really benefit their family.
AIG’s online trust process requires no wet signatures which means the whole process is streamlined, fast and efficient. Being able to offer your clients the benefits of a trust so easily should increase the number of policies you place in trust.
Upskilling is a way to improve your adviser's ability. This can be through growing their product knowledge, implementing processes and teaching them how to overcome objections. Having a highly skilled team is critical to the success of your business.
Invest some time and resources into providing your advisers with a comprehensive training plan. Make sure they are well skilled and fully equipped to be able to give the most suitable advice at all times.
Developing their skills and knowledge will help ensure that the advice they give is right first time. This will have a positive reflection on your business and will increase the likelihood of repeat business. It will also increase the likelihood of referrals through greater customer satisfaction.
Fully understanding protection products and selling them on the true value they offer your clients is so important. When deciding on cover, price is often a large factor for your clients, but you need to be confident that they’re aware of the real value of the different products available.
1. Product
4. Objection handling
5. Soft skills
6. Technology
2. Sales process
3. Fact finding
Objection handling is a vital and necessary part of your advisers skill set. When dealing directly with clients, developing strategies for building the appropriate trust, knowledge, empathy and relationships will ultimately help overcome objections.
Success in sales requires more than just technical know-how. Soft skills, those tough-to-define relational skills that help you earn your customer's trust, are equally essential to your business.
Technology is continually transforming the way businesses operate. Identifying new technology and training staff on areas such as social platforms, digital tools and Customer Relationship Management (CRM) systems will help streamline the sales process and help your business remain profitable and competitive.
It’s important to take a step back and evaluate your process to ensure your clients receive the right level of service throughout the whole advice process. It could be a great idea to have a process document or checklist to make sure you’re sticking to it every time.
When it comes to understanding your clients’ needs and being able to offer the most suitable advice, fact finding plays a crucial role. From hard to soft facts, the better you get to know your client means you’ll be able to advise on the most suitable cover.
Value added services are included within all types of propositions. They can be provider specific or offered by your firm as an add on.
Value added services build trust between you and your client. By highlighting the additional benefits they can receive with certain types of cover will show them that protection is more than just financial support at the point of claim.
Value added services will help with client retention. By offering beneficial services that are available throughout the lifetime of the policy, not just at claim stage, means your clients are less likely to cancel.
Clients who use the value added services will see the true value in their protection policy. If they’re making the most of the added benefits throughout the lifetime of the policy your clients are less likely to cancel.
4. Health and wellbeing
5. Flexibility
6. Value
2. Unique
3. Improved sales process
A large majority of the value added services offered with protection products focus on the health and wellbeing of the customer and their family. Helping your clients lead a healthier life will have a positive impact on your relationship.
Value added services can provide the flexibility your clients need. From on demand access to GP appointments to around the clock fitness and nutrition support, value added services fit in with your clients busy lifestyle.
Your clients will be able to benefit from services throughout the lifetime of the policy and not just at claims stage. Ask them how much they would consider paying for the value added services alone and remind them that they get that access at no additional cost.
Many value added services that are available through protection policies aren't available on the high street. By offering unique services it should improve persistency and retention for your business.
Understanding the key features of all value added services will help you to improve the conversation you’re having with your clients, resulting in an improved sales process.
Not taken up (NTU)
Not taken up is the number of applications that have been fully submitted but never activated.
Looking at the applications that have not been taken up, you'll be able to see business that is sat in the pipeline. You'll then be able to assess why that business hasn't been activated and put processes in place to improve the number of applications that are activated.
Knowing the type of applications which didn't proceed means you can change processes to improve and maximise efficency. This will lead to less applications that have not been activated and more income for your business.
Any test cases or cases used as part of training will contribute to the NTU figure. You shouldn’t use the system for these test cases as it will skew your results. For training purposes, training logins can be arranged for our demo site.
1. Training
4. Data
5. Underwriting philosophy
6. Fact find
2. Efficiency
3. Pre sales
Ensure correct customer data is captured first time, every time. Incorrect spelling of a name or the wrong date of birth can attribute to higher NTU rates.
Monitor all new publications and engage with your account manager on any changes to our underwriting.
A robust fact find will ensure the full needs of the customer is established prior to submission, mitigating any potential for unsuitability later in the application journey.
Improving NTU rates will maximise efficiency as this will save time on applications which typically do not proceed.
Make use of the pre-sales underwriting facility. It gives you an indication of terms we can offer that will help improve NTU rates, as opposed to multi-applying with numerous providers.
Smart Health is a non-contractual service. AIG Life is entitled to withdraw its services at any time.
AIG Life Limited. Telephone 0345 600 6820. If calling from outside the UK, please call +44 1737 441 820. Registered in England and Wales. Number 6367921. Registered address: The AIG Building, 58 Fenchurch Street, London EC3M 4AB. AIG Life Limited is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. The registration number is 473752.
EDCO 3504-0224
Thank you for reading.
www.aiglife.co.uk
