Catalyst for change

Efficiency is doing things right; effectiveness is doing the right things, says Ian McMullan, managing director of Canada Life Group Insurance

For followers of this column the problems that the group risk industry currently faces should be familiar. As 2009 – the financial world’s annus horribilus – draws to a close the demands of dealing with this recession will continue to occupy the thoughts of those in and around the industry for the foreseeable future.

However, here ends the doom and gloom. Whilst acknowledging that the recession has been severe and the effects widespread, it has also provided us with a platform and catalyst to promote positive industry-wide change. Writing in this column in July, Enrich’s Jamie Barnes said “we need to get smarter and better at what we offer and what we do”, and due to the rapid pace of change within the market described by Carlos Correia, we’ve had to get smarter and better faster!

So what does this look like? Well, as an industry, we proactively acknowledge that businesses are under pressure and are looking to group risk providers to provide cost effective, efficient solutions. This is a message that I believe most providers have taken to heart and are working on as part of their daily interaction with consumers. From a personal point of view, meeting the challenge of the recession has driven Canada Life to question, review and in some cases, improve our processes, service and products to meet the needs of the market. We have also invested time and money to provide effective solutions to the concerns of the market.

While the various group risk providers have shared the responsibility of growing the market in recent times, this year has presented us with the challenge of maintaining the market as it stands. Well founded concerns that the recession would adversely affect the small and medium segments of the market have stimulated product development and led to many providers refreshing their propositions.

The inclusion of a variety of integrated value-added services – such as employee assistance programmes – within several providers’ group income protection propositions are as much a response to these concerns as it is an attempt to grow the market. A survey in June reported that 44 per cent of business owners believed that their business would fold within 12 months of the death or long term illness of a key person. It seems logical that this concern is likely to be most strongly felt by SMEs. These additional services provide the sort of proactive support to everyday business, and personal, issues that many would otherwise struggle to provide or have access to.

In the current difficult market, the increased volume of quotes produced online continues to justify the investment and commitment to online technology shown by some group risk providers. Indeed, IT solutions now provide all advisers the opportunity to choose a provider that will allow them to set up, manage and renew business online. While I reported in May that our internal initiatives had reduced waiting time for traditional office quotes down to just five days, for those IFAs who have embraced and supported online business this waiting time can be as little as 20 minutes.

The end result is that everyone benefits because of the amount of time saved, more cases can be handled and the savings in time and money are ultimately passed on to benefit the end customer. Online business is in essence a simple, cost-effective business model that continues to show signs of growth and I am confident most of the major providers of group risk will embrace and develop this functionality soon.

The last issue I want to highlight is the collective push within the industry to raise standards, to improve the experience of our customers and to communicate our products more clearly both when we are selling and the ensuing period post sale. Various industry bodies – most notably GRiD – have invested significant effort towards helping the industry make the required adjustments to counter difficult market conditions.

While working closely with GRiD, I am pleased to see the efforts of the Service Standards Working Party coming to fruition, initiatives such as the agreement of a Service Charter and improvements to the quotation specification processes will help us raise the bar further.

Going forward we are keen to continue supporting the endeavours of the likes of AIFA, AMII, and the CII to ensure both progress within the industry and confidence in it externally. This dual commitment of growing and sustaining the market through demonstrating and delivering excellence will not change once the cloud of recession has lifted.