Adversity into Opportunity-Keys to successful Insurance Advice
What do you do when your prospective client says you’re just there to push insurance on him? He goes on to tell you that insurance companies are like a broken slot machine- they never pay out. This is the situation I faced last Tuesday.
The recent scandal surrounding CommInsure has highlighted the fine line that we tread as financial planners. We must stress the vital importance we play as advocates for our clients. Furthermore, we must avoid the trap of being apologists for rogue elements of our industry. We need to establish that we represent the interests and needs of our clients and that we DO NOT work for an insurance company. Simultaneously, we have to reinforce their confidence in the quality of the insurance company we eventually recommend and insurance in general.
This task appears more difficult when current affairs programs are devaluing insurance by trumpeting that you can almost die from a heart attack and still not get paid out. If one doctor agrees your claim should be paid, the insurer will brazenly lose those records and find a more cooperative doctor. And if a reputable doctor brings these problems to management attention he will be dismissed. But we are there to steer our clients away from such companies.
It’s not necessary for us to defend Comminsure (it would be difficult to do so) but it is essential to emphasise our central role in maintaining the integrity of the insurance industry. We are an integral part of the industry because we steer our clients away from poor quality cover. It’s imperative that they have confidence in us. We need to emphasise that we are recommending the best cover available today, but that in order to keep up with product improvements or a change in their circumstances we will review in 12 months time. We will be there for them year after year.
We need to remind our clients why they take out insurance. The purpose of the exercise is not to save a few bucks and sign up in five minutes on the phone. The purpose is to sleep soundly at night secure in the knowledge that you’ll get paid in a crisis. That’s why financial advisers have a job. We are there to facilitate a smooth application and claims process. We are there to guide the ship through the reefs and shoals to a safe harbour.
This scandal is the perfect opportunity to remind clients of the importance of insurance cover and of a financial planner’s expertise in choosing insurance cover. This is the perfect opportunity to reverse the industry’s slide towards DIY cover and differentiate ourselves from the banks. Most of the victims of this latest scandal would have been saved by a close relationship with a diligent financial planner. They just didn’t know it, at the time. We need to make them aware.