Appalling Agency Application Processes

You'd think that with all the talk about licensing and managing advisers, insurers would have gotten their act together and sorted their systems to account for and address the various demands of their business and the new rules. Nope!

Monday, September 30th 2024, 6:13AM

Before everyone gets their nose out of joint, I'm writing this to support the people toiling away in agency services with our insurers. Pay rises, and more people are needed all around!

AIA came out with a shiny new digital system, which, with my recent experience, has made the whole process worse, not better, from my perspective.

As I stated at the time this rolled out, as the principal, I have no visibility on what's going on with new agencies. Nor, as the FAP, is there visibility on what's what with any of our agencies with all of the providers.

It is all "trust they are getting it right" In the face of piles of evidence, they get it wrong an awful lot!

No AIA, I'm not singling you out here; I'm casting the net of generalised brick-throwing far and wide.

Frankly, with the exception of Resolution Life, agency services across the industry equally suck.

By the way, it's not the people in agency teams; like the rest of the challenges we have, management is the problem. Not enough people and too little investment in systems.

I talked to an adviser in a larger group today pencilling this, and their comment about their own systems was, "Like they always do, they roll it out before it's ready, and only 70% works!" Sounds about right.

I just replied to my AIA BDM, "Agency services busy and under pressure was the answer I got in 2008 when I was a BDM at Sovereign, and it hasn't changed; time to hire more people!"

Talking with a colleague who's an adviser, yes, everything is (expletive) broken. Attention to detail and quality control appears to have gone out the window. Nothing works properly, and no one has time to make sure it's right. (Again, that's management)

Coming from a systems design and engineering background with a couple of decades in financial services on top, the basics needed here are you have a system that manages this.

The sort of system that maybe looks a bit like an underwriting process?

End of the day, the approach to arranging a new agency mirrors the basic building blocks of underwriting a new policy:
* Application form (well doh!)
* Supporting evidence (PI and ID much the same as payslips and proof of address processes.)
* Sign off by applicant and principal (life assured and owners on the Dec & Consent)
* Detail on the agency splits and structure (Illustration)
* Detail on bank accounts (Payment Authority)
* Confirmation of contract (Offer of terms process)
* Contract issuing (Confirmation schedule for the agency and the contract the agency is operating under.)

This is not rocket science, and it is not even reinventing the wheel; insurers already have the damn wheel!

BTW, I just remembered that I should mention the brochure at the top that outlines the agency, banking, splits, and tax structures that the insurer will and won't entertain.

Maybe I'm looking at this too simply?

Just for context, with some basic out-of-the-box cloud tools that have the appropriate level of data security accreditation certification, I could mock up and have running a management process for this in an afternoon! I've done this recently for a client business that needed some help with a similar processing problem.

Sure, it would be running alongside existing agency systems, and it would be manual data entry, which most already are.

However, it would allow for and manage every task and approval needed, including the various bits and pieces needed to account for more interesting agency setups. (That may or may not be mentioned in the brochure on agencies I mentioned above)

Ok, fair. Internally, it will take longer because they want to integrate with the existing agency system. Sometimes, it's cheaper and easier to pay someone to do a bit of double handling. Spending money on systems isn't always the answer.

Does leaving it to people introduce errors? Potentially. However, like policy processing, if a summary schedule is produced at the end detailing the agency setup and its finer details, you can pick up the issues before they become real problems.

A problem out the other side of my recent experience; the insurer has managed to mix up bank accounts and paid associate commission to the wrong bank account. Yes, one insurer managed this before they even told us the agency was live.

Seriously, people expect the industry to manage and oversee adviser behaviour? The insurer can't tell you what they have, who they're working with nor if they are currently up to date.

Maybe it's politics? I have no time for politics; the insurer's business is there for one purpose. You're either working for that purpose, or you need to find a new place to work.

Let us have a look at this from the outside because this is where the rubber meets the road.

If, as the insurer, you make the onboarding process for new advisers horrible and miserable, how exactly are they going to feel about your products and your service for their future clients?

Yeah, that chestnut!

It was commented to me a long time ago the provider that gets the business is the one that the PA has the easiest time navigating their illustration system. Potentially, this still prevails today.

Insurers exist to provide services to the market, advisers are the customers, and policyholders are the advisers' clients.

If the interface to the insurer is horrible, the adviser is likelier to choose a different one. Food for thought ;)

I'm one for kicking the door in until it works because we need all insurers working in the market for it to work effectively. At the same time, most advisers are not like me; they don't waste their time on this stuff, they don't provide feedback, they vote with their feet and use someone else.

As an insurer, if you are not getting the market share you're expecting, have a look at how you are to interact with from the adviser's view.

You might be horribly surprised!

Tags: Jon-Paul Hale