November 15, 2018
Only half of advisers are conducting regular reviews of their client’s life insurance despite nearly 90 percent of clients wanting some form of contact every year, according to a new report from MetLife Australia.
The MetLife Adviser-Client Relationship Report 2018, found that while 86 percent of people want to be contacted by their financial adviser every year, only 56 percent of consumers and 50 percent of small to medium enterprises (SMEs) received a review of their life insurance from their adviser in the past year.
The report also found around half of those who had received a review of their insurance needs modified their cover, but also were more likely to refer their adviser to friends and family, and rate them higher.
MetLife stated that undertaking an annual review increased the Net Promoter Score (NPS) for an adviser to +30 for consumers and +9 for SMEs, compared to -25 and -20, respectively, without a review.
MetLife Australia Head of Retail Sales, Matt Lippiatt, said the research showed people wanted to be kept up to date on a regular basis and “…many advisers are missing a trick by not talking to their clients on an annual basis”.
“…many advisers are missing a trick by not talking to their clients on an annual basis”
“Reviews are crucial to the ongoing relationship, with the NPS results showing they dramatically increase client satisfaction and likelihood to recommend for both consumers and SMEs. This indicates an opportunity for advisers to check in regularly with their clients on their insurances, and to reinforce their value. Advisers have told us doing an annual review leads to increased referrals,” Lippiatt said.
The report was based on a survey of 700 consumers who have purchased life insurance through an adviser, 300 consumers who were considering purchasing life insurance through an adviser in the next two years and 200 SMEs with up to 20 employees.
In relation to the last group, the research found SMEs had higher expectations than consumers when it comes to the annual review process and only 41 percent of SMEs rated their annual review as ‘very good’ or ‘excellent’, compared to 62 percent of consumers.
“Overall we found SMEs demand a higher level of service than the consumer group. They are likely to be highly engaged with reviewing their own business on a regular basis, and when it comes to their insurance they are looking for a personalised service from their adviser to fit their individual requirements,” Lippiatt said.
“Ultimately, well-structured annual reviews benefit both clients and advisers. This is a great opportunity for advisers to strengthen their relationship with their clients, demonstrate they genuinely care about them, and reinforce the quality of their advice,” he added.