Are your clients happy?

I would postulate that many of your current clients are not happy. But that isn't necessarily due to your actions or inactions.

Wednesday, May 18th 2022, 11:57AM 3 Comments

by Jon-Paul Hale

It is more fundamental with insurance clients; they see insurance as a grudge purchase or a necessary purchase. They would instead buy a boat or new car than pay insurance premiums.

People don't jump out of bed on a Tuesday morning and go, "I need to buy life insurance today!" Well, not without some motivator like a friend or loved one with a medical condition that concerns them.

So why are clients unhappy?

They have to pay a premium for cover when they feel social support should help them.
They don't like their life being judged with the terms they receive on policies
They don't like premiums increasing, age-related or underlying.
They don't like not being able to get the levels of cover they want.
They see it as a grudge purchase and hate seeing the premium deducted every month.
Their partner said they had to.

And a raft of other reasons, thousands of them.

None of them are under your control.

For example, I have a client who's a good friend, where we have an annual tournament of wits about their policy renewal for their family. A case of it's too expensive! So what do you want to get rid of? And around it goes.

The reality; this client, like many of our clients, has a good deal. They have cover that covers them the best it could when they took it, and since then, they have developed or progressed medical conditions and, in this case, started bloody smoking. (I have a couple of clients complaining about premium and have since started smoking, so you know where that leaves them)

So the options to move providers for a cheaper deal, I looked after them on the commission going in, and the loadings on premiums they would now face means there isn't one.

Even under some of the pre-existing conditions offered out there, there is no better deal than they have presently.

Are they happy they have a great deal on their cover covering their family as they want? Nope, they resent the premium coming out every month, and they resent that premium increases every year.

They aren't happy about the lack of cover options; they aren't happy about increasing premiums, and they aren't happy about getting older either.

I have absolutely no control over any of these things.

Being a mate, he got the blunt; you're getting older, buddy, you have two choices, suck it up or remove coverage.

The problem is, outside advising on the levers they can pull, the fundamental here are they have to decide which area(s) of their protection they want to cut back. Or a better question; which areas are not as important as others.

We all have clients like this, and the only thing we can do is advise on the options.

So why am I banging on about something that should go in my complaints register?

Technically, clients complaining about premiums should go in the complaints register; they are complaining and expecting a solution.

My flippant comment to that; doing precisely that on reviews with clients is exactly what we should be doing; it is our job.

It's not a complaint for the register; it's our job to manage this as part of our KPIs as advisers on life insurance. My CRM is a complaint register if you want to be pedantic and push my anti-establishment humour.

That still doesn't answer the question, why this rant?

I've seen in several recent articles since we got a new head of the FMA talking about client happiness.

This language concerns me when it focuses on the insurance market, both life and medical, and fire & general. This is because clients are not happy with their insurance until they are.

There's not enough, it's too expensive, and someone else has a better deal. It's a constant battle of wits talking through all of these issues with clients to have them still resentful of the products and the premiums they pay at the end.

Until the wheels fall off and they have to claim; then it's "wow, we're awesome!" We've saved them financially, and they have a lot less stress in their lives.

But until that point, most clients are going to grumble at some point.

This makes the FMA's language about clients being happy concerning, as it is subjective and difficult to quantify reasonably when measuring adviser performance.

Is the adviser at fault for berating a client to hold their cover, so it's there for the claim. Probably, I've seen this behaviour at times and don't condone it.

Are those same clients upset through that time holding the policy? Yup.
Are they happy they had the cover when they had to claim? Yup.

My extreme point here is that measuring client happiness is a path to failure; it will not reflect the reality of clients well looked after, and it certainly won't help the perception of advisers in the eyes of the public or Consumer.

Are unhappy clients with other advisers an opportunity for you, possibly, but probably not. More they are unhappy about everything else but the adviser; at the same time, clients use emotional language when they talk about our stuff and blame the adviser for things outside the adviser's control.

My final thought signing this off, how much of the language on happy clients is due to Sue Chetwin's influence on the FMA board? It's the sort of thing we've come to expect from her when considering our industry.

Tags: client engagement