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Ian McKenna: Protection innovation will be a boon for advisers

American peers have been reluctant to embrace ground-breaking technology

Since protection technology provider iPipeline acquired Assureweb six years ago, its services have gone from strength to strength. In particular, its research and quote tool Solution Builder has won many fans.

Last month, I got a preview of the next generation technology it is building at its Connections conference in Las Vegas. On this evidence, I expect it to continue to push the boundaries of industry innovation.

I was especially impressed by the artificial intelligence services it is developing to identify insurance products and the amounts of cover consumers will want based on their attributes. These have been built by analysing patterns identified from the six million-plus life insurance proposals processed via its iGO app, the leading electronic application system in the US, used by 70 different life companies. So far, it is achieving a 90 per cent success rate for term products.

Unlike investment, where US advice technology is around three years ahead of the UK, the services protection advisers use here are just a dream for their American peers. This is not because the necessary technology does not exist, just that US insurers have yet to embrace it.

Advisers in dark over new protection CPD requirements

According to consulting firm Celent, US insurers take, on average, 38 days to underwrite a typical case. Firms that could reduce this to an average of 17 days were seen as market leading.

Just compare that with the instant acceptance that an increasing number of UK life offices provide.

That said, US advisers face similar challenges to their UK peers in that life offices do not understand enough about, or support, the ways they work. A consistent message at the conference was that providers need to do far more to enable the reuse of data from their practice management systems.

Merrill Lynch highlighted that the new business submission system it has deployed from iPipeline’s Affirm is pre-populated with client data from its back office, minimising the need for advisers to re-enter it, which saves time and reduces the risk of human errors. This should be normal practice but sadly it is not.

Equally, Morgan Stanley made a case for insurers making all the information on any policy they have sold available to advisers. By failing to provide the information advisers need to deliver an ongoing service, protection providers are ensuring they will not be part of the primary recommendation.

One of the main reasons UK advisers are turning their backs on protection in droves is that there are hardly any life offices doing all they can when it comes to the reuse of data or providing sufficient ongoing information to advisers.

But those life offices using iPipeline’s TCP platform should be ideally placed to fix part of the problem. TCP is the platform Aviva’s protection system now sits on and what will also support the new Zurich protection offerings. LV=, Royal London and Scottish Widows are all also clients.

This brings the potential for real synergy between life company systems and the various iPipeline portal tools, which could be further enhanced by integrating with adviser practice management systems.

The great tech being shown at the event did not just come from iPipeline. Both Advicent and MoneyGuidePro showed some excellent protection needs analysis and cash planning tools.

What is more, leading US adviser CRM Redtail showed some great SMS-based communication tools and demonstrated how consumers responded to text messages far more promptly than e-mails. This is interesting: should there be a more prominent role for text in the way organisations communicate with clients?

As someone who goes to a lot of conferences around the world on leading-edge technology, I found Connections exceptional. And with the majority of US life offices not embracing innovation, the UK could be the first place to benefit from many of the great new services shown. That said, iPipeline UK customers were conspicuous in their absence. They missed a lot and really should look out for the conference dates next year.

Ian McKenna is director of the Finance & Technology Research Centre

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