Category Life Insurance

Metropolitan unveils a world first

10 March 2006 Janine Greeff

REI aims to transform the way new business applications are handled by introducing a simpler application process built around a telephone call.

Derek Pead, Chief Executive Officer of Metropolitans Retail Business, says REI when fully implemented and effective would lead to annual savings of in excess of R10 million. The envisaged benefits are in terms of not only costs but also improved intermediary and customer service as well as enforcing compliance to relevant customer protection and sales process legislation, says Pead.
Pead adds that REI was implemented because the groups sustained success required ongoing and radical change.

We needed to urgently cut the cost of doing business while attracting new customers. For us, merely adapting existing processes or adding new ones was not an option: we needed a critical re-evaluation of our operations with the objective of issuing business quicker while reducing the administrative burden on intermediaries, says Pead.

Independent UK-based underwriting expert, Peter Maynard of SelectX consultancy, says REI, which was developed by Metropolitan and industrial engineering consultancy Indutech amounts to a reinvention in the life assurance industry.

Says Maynard, REI has not only transformed the way that new applications are handled, but also puts the customer at the heart of what the company does. With lower income groups in mind, Metropolitan has created a strong, distinctive customer proposition. And furthermore, by introducing a much simpler application process based on a telephone call, it has made life insurance more accessible to a group that has been ill-served in the past.

The new process allows intermediaries to generate a quote for their customer and immediately, upon acceptance of the quote, a new policy request can be submitted and accepted via telephone at no cost to the intermediary. The request is facilitated telephonically by the Metropolitan Area For Customer Enrolment (ACE) Centre where all policy details are captured via information given by both the representative and the customer. All details are voice-recorded and the recording acts as proof of the transaction. Whenever possible, the policy will be issued on completion of the telephone call.

With the advent of REI, when underwriting is now required, this is done through a tele-interview process, which may lead to a reduction in the number of medical examinations and other tests required, while not compromising the quality of the underwriting.

Says Pead: REI process was built around a number of core principles the most important being that we trust our customers and intermediaries and put them at the heart of our business; that we accelerate our processes and that we reduce the costs of doing business to our intermediaries and the company. REI has the added advantage to our customers in that it provides increased assurance to both our tied intermediaries and customers that sales are legally compliant with both parties - confirming that all legal disclosures have been made and understood.

REI allows Metropolitan to engage with customers in rural and outlying areas who are not close to regional offices. Intermediaries will now be able to conduct business anywhere in the country, as long as they have access to telephone technology.

Pead says, We can now offer a new deal to customers in the form of sound products, fair pricing and very easy access. REI will benefit financially disadvantaged groups in the population and will assist us in reaching the target set by the Life Offices Association to increase the number of policyholders in the lower-income bracket by 81% over the next eight years.

To date, more than 20 000 policies have been issued through REI.

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