Why insurers need to lift their support game for advisers

Australia’s hard-working financial advisers are finally seeing some relief after years of facing significant challenges including ongoing regulatory and business cost pressures. Adviser numbers, which had been in rapid decline since the 2018 Hayne royal commission, have begun to stabilise, indicating a more positive outlook for the future.

With these signs of renewal and success in navigating big challenges, and after having invested in their businesses, advisers are now reaping the rewards with robust practice health.

For insurers, this period of relative stabilisation presents a prime opportunity to enhance their support systems for advisers and continues to help build upon the growing momentum of quality financial advice.

There is good reason for this call to the insurance sector. According to Adviser Ratings’ 2024 Australian Financial Advice Landscape Report, advisers are seeking to work more closely with insurers. On the flip side, insurers are seeking to improve their proposition to advisers and their insured clients.

In particular, the report highlights three key qualities that advisers are looking for in a risk insurer: personalisation, service quality and ease of doing business. By focusing on these areas, insurers can build stronger relationships with advisers, enabling improved outcomes for their clients.

1. Personalisation and understanding of clients’ needs

As expected, one of the most critical qualities advisers look for in an insurer is a deep understanding of their clients’ needs and products designed to meet those needs. Insurers that focus on and prioritise the outcomes of clients through a culture of empathy, transparency and efficiency are more likely to succeed in this regard.

Insurers can leverage data analytics to gain insights into client behaviours, needs and preferences, allowing them to develop more customised products and services. This not only enhances the client experience but also fosters collaboration between adviser and insurer. Advisers understandably prefer insurers who can demonstrate a genuine understanding of their clients’ unique circumstances and needs, and offer solutions specifically designed to meet those needs.

2. Quality of service

High-quality service is another top priority for advisers when choosing an insurer. This includes the support provided by the adviser-facing business development managers (BDMs), the quality of online services, and the comprehensiveness of the insurer’s product offerings.

BDM support is crucial, a professional bridge between advisers and insurers. Advisers rely on BDMs for their product, industry and competitor knowledge, as well as “on-call” product and technical assistance. This support function is reflected in the Adviser Ratings report, where BDM support was one of the factors against which advisers measure the quality of insurers.

High-quality online service is also vital, as digital access provides advisers with the tools and resources needed to manage clients’ policies efficiently. This includes user-friendly platforms, quick access to policy information, and seamless transaction processes.

3. Ease and service standards

The ease of working with an insurer and the standards of service they uphold are vital considerations for advisers. Naturally, efficient supporting technology and platform functionality play a significant role in this area. According to the Adviser Ratings report, user experience and interface are key drivers for advisers when it comes to platforms.

In addition to platform functionality, advisers surveyed also highlighted ease of underwriting, including pre-assessment, as a key factor shaping their decision making when placing business with an insurer. Notably, insurers that scored highly on adviser satisfaction in the survey had stronger and more streamlined underwriting criteria, since this would naturally reduce the time and effort needed to get clients insured and lead to higher satisfaction rates.

Promptness of claims handling and payment is also essential. Advisers value working with insurers who handle claims efficiently and transparently, ensuring that there are no hidden agendas or unnecessary delays.

Finally, it is crucial to acknowledge the significant role advisers play in delivering quality insurance outcomes. Despite the challenges of the ever-changing landscape of advice, advisers have continued to show enormous grit, dedication and commitment to client outcomes, particularly during critical claim moments.

The relationship between advisers and insurers is crucial to the longevity and effectiveness of the entire risk insurance industry. As the advice industry stabilises, orients towards sustainable growth practice and continues to evolve, insurers have a unique opportunity to elevate their standards and further enhance the quality of their systems, support, and cultural impact for advisers.

By aligning with the needs of advisers and focusing on the key areas of personalisation, service quality and ease of doing business, insurers can forge stronger partnerships with advisers and contribute to better client outcomes, paving the way for a more robust and resilient insurance landscape.

Michael Pillemer is CEO at PPS Mutual.