Learning from your clients

The local service industry is subject to a great deal of criticism from irate consumers. To investigate if the complaints are well-founded, we looked at complaints logged on a popular South African consumer website and also report on a personal experience, which was disappointing, to say the least. 

In the last ten days, no less than 82 complaints/compliments were recorded in the insurance category of a popular local consumer website. After adjusting for repeat and misallocated complaints, the number of unhappy clients remained substantial. In addition, many clients go directly to the various Ombuds offices, and do not even visit these consumer websites. 

There were about ten times more complaints than compliments. Complaints centred on dissatisfaction with response times and rejected claims, while compliments were almost always in response to quick payouts.

Closer to home than you'd think
A recent and very disappointing experience with my own (now ex-) financial adviser made me realise that much of the blame for these complaints can be placed on the adviser.  

Because I am part of a team producing a magazine aimed at financial advisers, I would have liked to believe that my adviser would be very cautious of how he conducted himself when I recently applied for an income protection policy.

On the contrary, he very briefly and quickly ran through the questions with me, insisting that he fills in the application form to save time. I was asked if I had any illnesses or received any treatment in general. He did not ask any of the specific questions until I insisted he works through the list, one question at a time. 

As we went through the list, he commented on most of my answers, saying that they are not important. Surely the underwriter posed the specific question precisely because it is relevant or important!

Who is guilty of non-disclosure?
A financial adviser who approaches his client's cover with such flippancy will surely, sooner rather than later, be the cause of a client not receiving compensation because of non-disclosure of 'basic' info. 

Simple solutions
Considering the nature of the complaints on the consumer website and this personal experience, it would appear that reducing the number of unhappy clients should be simple enough.

Simpler, better and faster
Complaints centering on client service stem from slow or erratic communication between the client and the intermediary. Dealing with the emotional impact of a vehicle accident or illness is difficult enough without having to fight with your broker or insurer to respond to your calls.

In the case of refused claims, dissatisfaction is magnified where the client feels that the exclusions or conditions were not properly explained when the policy was purchased.

Close attention should be given to client contact centres. Response times should be monitored and improved on an ongoing basis. There is no excuse for failing to handle queries quickly and efficiently.

Special emphasis should be placed on promises made by intermediaries/brokers and call centre staff to clients. Nothing causes more frustration than a promise not delivered on. Where enquiries must be escalated, call centre staff should be careful about promising specific response times from back office staff - though they should be able to rely on their back office staff for quick follow-up when required.

Taking it seriously
Heeding the adage 'prevention is better than cure', it makes sense for insurance intermediaries (and insurers) to pay close attention to their sales and marketing processes. 

Brokerages need to ensure that all personnel dealing with clients are properly trained and their performance regularly evaluated. Financial advisers and front line staff should understand the responsibility that rests on their shoulders to inform, guide and provide the right advice.  

The intermediary's sales and marketing team should ensure that insurance product is accurately described. Many clients do not fully understand what they are buying and without proper info from the adviser they are likely to be disappointed at claim stage. 

Exclusions, excesses and standard administrative procedures should be communicated to the client up front. Flippancy and irresponsible behaviour to save time are simply not acceptable.

Clients' rights
Each new policy or claim opens a variety of communication channels between the client, intermediary and the insurer. A breakdown in communication impacts negatively on the service the client experiences and his/her perception about the industry.

Clients are quicker to complain than to offer thanks. And with good reason - they are paying for a particular level of service and professionalism and expect to receive it.

Editor's thoughts:
Improved communication at all levels of the 'transaction' will go a long way to change the current negativity surrounding the industry.