Lack of Time Driving Advisers to Claims Services

Advisers are opting to use claims advocacy services to free up their own time to interact with clients and to work on their businesses, according to the head of AFRM Claims Advocacy (ACA), Bruno Muraca.

ACA Chief Executive, Bruno Muraca

He said since its launch ACA had signed up around 100 advisers across 40 practices to its claims advocacy services where around half wrote risk business and were capable of handling claims but still chose to outsource the task to ACA.

“The main themes we are seeing among advisers who use ACA is they have a limited capacity to handle claims alongside their other work and are being redirected from working with current clients and developing new clients,” Muraca said.

He said some advisers did admit they were less experienced in handling claims but ACA was not seeing a split between risk only advisers and those who also worked in the area of wealth management.

“The pressure on all sorts of advisers to handle the work involved in the claims process, and find the bandwidth to complete that task, is similar across the board,” he said, adding a basic claim can take at least ten hours to complete and most practices will have an average of five claims per year.

“The pressure on all sorts of advisers to handle the work involved in the claims process…is similar across the board”

Muraca said the time liaising between medical practitioners, insurers, advisers and clients can quickly add up and the use of a claims advocacy service allows advisers to focus on enriching their client relationships by providing emotional support during a difficult time.

“Previously, they have not been able to have as much of an influence on their clients’ return to wellness as they can now, with ACA’s support. It’s the influence on the clients’ return to wellness that bolsters the relationship with the client and their family,” he said.

Muraca added that ACA had taken on 12 new client claims during June and July and was continuing to receive interest from the adviser and superannuation trustee market after spending the first half of 2018 developing its service offering.

“After launching in the last quarter of 2017, we spent our first six months listening to the market to ensure our product offering was relevant to all stakeholders – retail advisers and their clients, superannuation fund trustees and insurers – so it is really pleasing to see the traction we have achieved in the past six months,” Muraca said.

  • Walker

    Outsourcing is fine, provided the cost is absorbed the the adviser and not passed through to the client. This is what trail commission pays for.

    • Old Fella

      Agree totally Walker. For anyone writing risk, your key responsibility is to stand beside the client at claim time. Charging fees to a client, particularly for an income protection claimant whose income has already usually fallen, is unconscionable.

  • james

    Outsourcing claims????? This is the most important part of the process and the reason for having an adviser. If these advisers are charging their clients for this service then they should be baned from providing risk services.

    Once you palm off a client to someone who doesnt know the client and has no relationship with that client, they become just another number and wether the claim gets paid or not doesnt matter to the claims handler.

    Wealth advisers should stick to investment. Go back to earning your trail commission by changing the investment options in the Wrap Accounts around each year for no reason other than pretend you are doing something to claim your trail commissions. Leave risk to the advisers who care about their clients.

  • LC Hammer

    I commend you James. Yes, claims is the most important part of the process. However, let’s consider the word “process” for a moment. The regulatory landscape has changed so dramatically over the past few years that the “process” is vastly different than what it once was. Consider a self-employed adviser who now must contend with the LIF changes to commissions structures as well as a much higher standard of compliance, and the increasing end to end cost of the “process” of providing advice. Many advisers simply do not have the expertise or experience to manage claims effectively. With the myriad of hats an adviser needs to adorn, which one of those hats gets the adviser’s full undivided attention, 100% of the time? None. So, is it not better to outsource the MOST IMPORTANT (your words) area of advice to specialists who DO spend 100% of their time with just one – the most important – hat on? Or is it better to continue to do a whole lot of things, at half measure? Positioned correctly, there is an opportunity to add value to your services by addressing this at the start. Inform the client that should they be in the very unfortunate position of needing to claim, you have a team 100% dedicated to advocacy on their behalf. It’s all they do – 100% of the time, with 100% of their attention. Seems a no brainer to me. To suggest the client who gets referred to the professionals in the claims advocacy service are “just another number” is one way of looking at it. If I were a client and my adviser referred me to a specialist service specifically to manage my claim, I would think that level of escalation shows commitment and integrity – ensuring I received the best service possible, just as a GP refers one to a specialist because the GP lacks the expertise, knowledge, time and networks to provide the best outcome possible. Why would the people behind the claims advocacy service start, manage and develop the service, and devote all their time to such a service if they were not passionate about claims? To suggest that it would not matter to the claims advocacy specialist whether or not a claim got paid is rather contrary to the whole point of the service. Anyway, of course you are entitled to your view. In the words of LKY (Prime Minister of Singapore) “If you deprive yourself of outsourcing and your competitors do not, you’re putting yourself out of business.”

  • LC Hammer

    Yes, claims is the most important part of the process. However, let’s consider the word “process” for a moment. The regulatory landscape has changed so dramatically over the past few years that the “process” is vastly different than what it once was. Consider a self-employed adviser who now must contend with the LIF changes to commissions structures as well as a much higher standard of compliance, and the increasing end to end cost of the “process” of providing advice. Many advisers simply do not have the expertise or experience to manage claims effectively. With the myriad of hats an adviser needs to adorn, which one of those hats gets the adviser’s full undivided attention, 100% of the time? None. So, is it not better to outsource the MOST IMPORTANT (your words) area of advice to specialists who DO spend 100% of their time with just one – the most important – hat on? Or is it better to continue to do a whole lot of things, at half measure? Positioned correctly, there is an opportunity to add value to your services by addressing this at the start. Inform the client that should they be in the very unfortunate position of needing to claim, you have a team 100% dedicated to advocacy on their behalf. It’s all they do – 100% of the time, with 100% of their attention. Seems a no brainer to me. To suggest the client who gets referred to the professionals in the claims advocacy service are “just another number” is one way of looking at it. If I were a client and my adviser referred me to a specialist service specifically to manage my claim, I would think that level of escalation shows commitment and integrity – ensuring I received the best service possible, just as a GP refers one to a specialist because the GP lacks the expertise, knowledge, time and networks to provide the best outcome possible. Why would the people behind the claims advocacy service start, manage and develop the service, and devote all their time to such a service if they were not passionate about claims? To suggest that it would not matter to the claims advocacy specialist whether or not a claim got paid is rather contrary to the whole point of the service. Anyway, of course you are entitled to your view. In the words of LKY (Prime Minister of Singapore) “If you deprive yourself of outsourcing and your competitors do not, you’re putting yourself out of business.”

    • james

      Investment advisers should stick to investment as invariably they dont quite know what they are doing in the risk area at all stages of the process. That being said. If you are unfortunate enough to have your insurances set up by an investment adviser then the claims service would probably be ideal.

      My concern is, especially with ongoing claims such as IP claims, who pays for this service? I bet that that it is usually the client and i bet this isnt disclosed to the client by the adviser when they are taking their commission.