"Offering the opportunity to update details and remind them that they have proactively secured their financial future should be celebrated, not feared."
Remember MySpace? In the mid-2000s, it was considered the ‘cool’ social media platform. At its peak, MySpace had almost 76mn unique users and helped launch the careers of Lily Allen and the Arctic Monkeys.
So, what went wrong? News Corporation, led by Rupert Murdoch, bought MySpace in 2005 and decided to drive ad revenue rather than put users first - not the smartest of decisions.
“News Corporation assumed it had a captive audience that would remain loyal to MySpace, no matter what.”
The protection market is quite different to the world of social media, but the mistakes made with MySpace highlight the importance of ongoing dialogue with customers.
Social media platforms have numerous opportunities to connect with users, observe behaviour, and request feedback for improvements. We have far less to gather this invaluable information. Therefore, doesn’t it make sense to make the most of every opportunity?
Outside of claims, annual reviews allow us to connect with customers, ensure we’re providing the protection they need, and address any concerns they might have about their policies.
“It baffles me that so many still aren’t taking advantage of annual reviews. Why would you ignore the chance to have meaningful conversations, especially in light of Consumer Duty?”
A big reason is fear. Fear that if they remind customers about protection products they’d forgotten about, they’ll opt to cancel. Advisers believe it’s better to ‘let sleeping dogs lie’, preferring to go under the radar and retain customers by stealth.
This approach is a mistake. Firstly, changes in job, home, or personal circumstances will have an impact on protection policies - advisers should be asking these questions every twelve months. Missing the opportunity to have this conversation means customers are at risk of their policies being unsuitable, insufficient, or invalid.
“If a customer needs to claim, and the policy doesn’t reflect their current circumstances, it’s bad news.”
Not only will they miss out financially (which could be devastating), but it also damages their trust in the industry and fuels the perception that insurers are looking for any reason not to pay out.
Secondly, it wrongly assumes that customers don’t value their protection products. If a policy has been discussed with an adviser and sold correctly, the customer will appreciate the role it plays and its potential value.
Offering the opportunity to update details and remind them that they have proactively secured their financial future should be celebrated, not feared.
Finally, annual reviews provide a useful touchpoint to highlight the benefits and ‘perks’ that add value to protection policies. We spend a lot of time sourcing these added-value services, so it makes sense to take every chance to promote them.
In the last three years, Cirencester Friendly has used annual reviews to focus on these benefits and celebrate customers’ decisions to protect their finances, lives, and families.
“This approach has led to a reduction in the number of cancellations we’ve received.”
If the protection market is to avoid the mistakes made with MySpace, we must make it a priority to engage with customers whenever we can, to ensure policies are both relevant and valuable.
