Over my last couple of columns, I have looked at the significant forward steps that a wide range of providers in the protection and investment areas have made in the adoption of e-commerce in the last decade or so. In a few weeks, I will also look at the platform market, where, in a few cases, we are starting to see the truly seamless end to end processing that has so long been desired by advisers.
Before discussing those companies which are increa-singly becoming “new model providers”, I think it is fair to examine the extent to which one life office is transforming itself to meet the challenges of the new market.
I am not saying it is the only provider to have funda-mentally reinvented the way it handles the information and processes that are the bedrock of our current industry – there are clearly two or maybe three others I could look at in the same way and in the coming months I probably will – but it is fair to say that the company I have in mind has undoubtedly achieved the most dramatic transformation.
Some people will doubtless be surprised to read that Aviva is the company I believe is worthy of the above plau-dits. Only a few years ago, the name Norwich Union conjured up in many people’s minds a business with a myriad of systems that had struggled to achieve the system consolidation necessary when four providers – Norwich Union, Commercial Union, General Accident and Provident Mutual – were merged over a relatively short timeframe.
In contrast, when I recently asked all leading life, pension and platform providers for a summary of their successes in the e-commerce market, Aviva was able to point to a range of new services across its business.
This is a result of a massive investment relating to customer information across its entire organisation, including not only the life and pension business but also Aviva Investors. Last week’s announcement of its new Aviva platform, bringing together £56bn of investment assets as well as protection and annuity products in a single service, is a clear demonstration that its policy is paying dividends.
In practice, much of what was announced last week is already live. By the end of May, 96 per cent of all Aviva life, pension and investment policies will be accessible online.
The approach has been about enabling the adviser to create the documents they need direct from Aviva’s extranet and save them to their own systems.
While ideally I would like to see such services operated as seamless messages between adviser and provider systems, it needs to be recognised that this can only be achieved once the correct underlying architecture has been put in place across the business. The services that are supporting these extranet developments today will be the foundation.
From end to end and across the Aviva business, the technical infrastructure has been put in place to make straight-through processing a reality. I have previously identified its 100 per cent electronic submission record for the simplified life product but how many providers also achieve over 75 per cent online submission for bond applications?
Additionally, a new service recently went live allowing fund switches and redirections to be processed by the adviser online without the need for a client signature. In the first few weeks of operation, this already accounts for 10 per cent of all fund switches. Clearly, an excellent start.
Of the many new services being rolled out, one which should be a lesson to the whole market is Aviva’s e-documents initiative. Many millions of copy documents are delivered by the company to advisers each year at an enormous cost in terms of both postage and the environment. If received on paper, these represent a storage overhead for the adviser, either in physical files or scanned documents. It is, of course, far more logical to let the adviser download document files in a document format.
The service is already live for individual pensions, where advisers can get copies of unit and benefit statements and group pension business, where a new joiners policy document can also be accessed.
It will be extended in June to deliver similar docum-entation for bonds, with protection and other products following later in the year.
Over the next year, it is estimated that this will remove the need to produce three million items of paper, the majority of which would probably never have found their way to the client record within an adviser’s business management systems, whereas now they can be downloaded and stored digitally.
The next obvious step would be to make such copies available as a monthly digital download for all clients. Hopefully this is planned.
While the advances outlined represent enormous progress, there is still a vast amount of work for Aviva to do. However, it has radically re-engineered the way it works and because the company has taken a longerterm view on putting in new core services rather than implementing short-term fixes, many of the benefits of the work which has been going on for several years are only now starting to filter through.
Having put in the right underlying infrastructure and recognised the need to open up virtually its entire back book, Aviva is putting itself in an excellent position to partner with advisers in the RDR world. I can think of only a handful of other providers which would pass such a test. This deserves recognition when advisers are selecting their preferred partners for major initiatives.
Ian McKenna is director of the Finance & Technology Research Centre