![\"\"](\"https:\/\/riskinfo.com.au\/news\/files\/2013\/07\/Rebecca-Sheils.jpg\")
<\/a>The Association of Financial Advisers (AFA), in conjunction with The Beddoes Institute and BT Financial Group, has produced a new White Paper called the \u2018Value of Protection\u2019, which compared the perceptions of the claims process with actual claimants\u2019 experiences. It found there was a significant gap between what insured clients believed they would need to do to make a claim, and the support they would receive while on claim, versus the actual experience of recent claimants.<\/p>\n
The Beddoes Institute interviewed ten consumers with income protection insurance, which had been purchased both direct from the insurer and through an adviser. All of the consumers said they believed the claims process would be difficult, drawn-out and adversarial.<\/p>\n
Specifically, the research found that consumers believed:<\/p>\n
- \n
- They would need to see multiple doctors in order to complete their assessment, including the insurer\u2019s own medical specialists<\/li>\n
- The insurer would approach the claim with a suspicious attitude and would lack compassion<\/li>\n
- It could take several months for the claim to be approved<\/li>\n
- Once the claim was approved, insurers would \u2018check in\u2019 regularly to get proof that the claim was still legitimate<\/li>\n
- If the insurer provided rehabilitation services the primary driver behind this would be to minimise the claim duration<\/li>\n<\/ul>\n
\u201cClients thought that when it first happened it would be very difficult and they\u2019d be pretty overwhelmed,\u201d said Dr Rebecca Sheils<\/strong>, who carried out the interviews with the consumers. \u201cThat said, they expected the insurer to make it even more difficult for them, during an already tough time.\u201d<\/p>\n
Beddoes then asked three people who had recently been through an income protection claim of their own about their experience. In contrast to the non-claimants, the claimants said the actual experience was vastly different and far more positive than they expected.<\/p>\n
The claimants were asked to list the best part of the claims process, coming up with four consistent areas:<\/p>\n
- \n
- Holistic support with recovery<\/li>\n
- Empathy, sensitivity and client focus<\/li>\n
- Having a dedicated case manager and the continuity of staff<\/li>\n
- Ease of the claims process<\/li>\n<\/ol>\n
The AFA\u2019s Brad Fox<\/strong> said the results of the research had very clear implications for the insurance industry and the way it positions itself in the consumer market.<\/p>\n
While the gap in the perception and the reality of claiming is so far apart, we\u2019re going to continue to have a significant underinsurance problem<\/p><\/blockquote>\n
\u201cGetting someone to buy insurance is actually about a promise. And yet, we haven\u2019t really measured how people are reacting when the promise is delivered. It\u2019s a significant gap. And whilst we know underinsurance is so high, perhaps if we did a better job of getting the evidence and sharing the evidence the right way in the market, perhaps the impression around insurance will change.<\/p>\n
\u201cWhile the gap in the perception\u00a0and the reality of claiming is so far apart, we\u2019re going to continue to have a significant underinsurance problem. So our first step is to build the evidence pool to help us communicate out.<\/p>\n
\u201cIt\u2019s not just about insurance \u2013 the value of advice more generally is misunderstood. On claims, it stands out completely from this research \u2013 you could drive a car through the gap. And we need to fix that.\u201d<\/p>\n
The White Paper provides a seven stage best-practice claims framework for insurers, which Beddoes says can be used to benchmark current performance and to inform future practices. The AFA and BT\u2019s Head of Life Insurance, Phil Hay<\/strong>, will be presenting on the findings and implications at this year\u2019s AFA roadshows. Click here<\/a> for more information about these events.<\/p>\n