In the current environment, risk advisers must look for every opportunity to ensure they are as efficient as possible, so why not take advantage of the free service offered by most insurers – tele-underwriting?
When you calculate the amount of hours spent on implementing insurance for your clients it would generally average somewhere around 10 hours of work. This is taking into account the applications that go straight through to completion as well as the more complex cases that, on top of the application, may require medicals and financial evidence for the insurer to be able to make an informed decision. Some of these complex applications can take up to 40 hours of time and effort by the adviser, and not always for high-value insurance policies.
Even after completing this process, there is no guarantee that the application will be accepted or that you will be remunerated for your services unless you charge a fee for your service. Essentially, you may have just spent a week of your time doing free underwriting work for the insurer.
The other issue to consider is who bears the responsibility for the client information provided, given the growing number of claims disputes around what information the consumer provided to the adviser during the application process.
With this in mind why not take advantage of the free service offered to advisers by most insurers, which is the tele-underwriting service?
This involves your client completing a medical questionnaire over the phone, generally with a registered nurse. They will also ensure any additional questionnaires are completed if required. For example, back or knee disorders, occupation duties, or hazardous pursuits.
In the event that your client requires further evidence in order for the insurer to assess the application, the tele-underwriting service will organise for your client to have the necessary medicals, blood tests, resting ECG, and the like.
All calls are recorded for evidence in the event of a claim. This means the adviser will not get caught in the middle of a possible non-disclosure dispute, which will of course drain more time and energy from their practice.
Of course, the immediate benefit for the adviser is that by making use of the tele-underwriting service they will be become more efficient and profitable.
It is estimated that the use of tele-underwriting could save three to four hours of time. If your charge out rate is $200 per hour, this is a saving of $600 to $800 per application. If you multiply this by 50 applications there is a saving of around $40,000 per annum. And of course, the 200 hours of time saved could be much better used in developing and marketing your business.
It may be that you still want to apply the process to your client base on a segmented basis, undertaking the whole client information gathering process with high-value clients and those with complex needs, while effectively outsourcing the process for clients with more simple needs.
Either way, with the current pressures facing risk advisers the potential efficiencies from using tele-underwriting simply can't be ignored.
David Spiteri is national risk manager at Centrepoint Alliance