Defaqto has published a review of the service provided by protection providers as rated by financial advisers.
The service satisfaction survey, which asked advisers to rate protection providers in relation to the importance of 10 categories, ranked ‘underwriting services and ‘new business processing’ the most important aspect of service. Once the importance of each service category was rated, advisers were asked to rate their own experience with protection providers and then the results were plotted, identifying gaps in satisfaction experience.
Defaqto asked financial advisers about their views on the service they receive from 25 individual protection providers covering life, critical illness cover, income protection insurance, family income benefit and whole of life assurance.
Product providers are then rated Gold, Silver or Bronze based on their overall rating score. They are available to view and use within Defaqto Engage, the firm’s investment planning software solution.
In terms of the individual protection products being used by financial advisers, the sector continues to be dominated by level term assurance, critical illness with life cover and decreasing term assurance. However, the support for most products decreased by, on average, three percentage points with the exception of income protection insurance, which gained ground. Whole of life assurance and standalone critical illness cover suffered the greatest drop in support.
Advisers were asked to rate the service they receive from protection providers in relation to 10 categories:
| Satisfaction category | Importance | Weighted Satisfaction
2017 2016 |
|
| Underwriting services | 1 | 78% | 75% |
| New business processing | 2 | 80% | 78% |
| Claims handling and administration | 3 | 53% | 53% |
| Product design | 4 | 77% | 80% |
| Online services | 5 | 66% | 66% |
| Technical assistance | 6 | 62% | 61% |
| Existing business administration | 7 | 66% | 58% |
| Provider strength and brand | 8 | 72% | 72% |
| Business development managers | 9 | 39% | 55% |
| Commission and remuneration | 10 | 58% | 61% |
Defaqto said the ranked order of importance continues to show a focus on the acquisition of new business and suggests that advisers are more comfortable with working online and less enamoured of face-to-face interactions with insurers.
David Cartwright, head of insight and consulting for wealth and protection at Defaqto, said: “A cross-match of ranked importance and ranked satisfaction revealed that for the industry as a whole, expectations are being met or exceeded for half of service categories. However, of the top three for importance, only new business processing achieved sufficient satisfaction scores to meet expectations; underwriting services and claims handling and administration fell short.
“All of the service categories are important and providers should consider all elements of their service and allocate resource where appropriate. With many providers offering similar products, service is a key deciding factor for advisers when it comes to product selection.
“Defaqto’s Service Ratings form part of our range of ratings suite. We analyse over 41,000 financial products in the UK of which nearly 10,000 are funds or fund families.
“Whilst these star and diamond ratings are expert ratings based on the analysis of product information, our service ratings are based on opinion. We ask financial advisers to rate the services they receive. This collective information helps the industry in continuously improving standards by creating awareness of what elements of service work well and what elements don’t.”