As the baby-boomer generation approaches retirement, consumers will need advice on how to achieve an optimal return on an unparalleled level of investments. It is clear that the conventional advice process which assumes retirement at 65 and the purchase of an annuity, with the principal residence remaining as an asset to pass on in an inheritance, is no longer fit for purpose. Consumers are living longer than ever before and will need to make their assets work hard if they are to maintain anything like the lifestyle they have become accustomed to.
The market currently lacks an integrated advice process that recognises the role of savings, pensions products, and bricks and mortar in funding income in retirement. An increasing number of providers are recognising the need for new products to meet these needs. However, the antiquated nature of the traditional processes means carrying out these transactions is both frustrating and expensive for advisers and clients alike.
I have heard some insurers argue that these are simply difficult processes to follow and advisers just have to put up with it. Personally, I believe providers need to work harder than that.
As a result, I was very pleased last week to see the new tracking service Just Retirement is delivering for both annuity and equity release products via The Exchange.
A tracking service has been available on The Exchange for some time now with Legal & General, Standard Life and Prudential all providing daily updates on the progress of applications for different products, including protection, bonds and pensions. I understand Aegon, Bupa and Norwich Union are all expecting to add tracking to their propositions next year.
Just Retirement is the first provider to support tracking for annuities and equity release. The company only offers enhanced annuities and the service includes both purchased life and secure annuities.
Equity release products covered are their fixed lifetime mortgage – where interest is serviced – and an interest roll-up product.
In delivering this service, Just Retirement and The Exchange have significantly extended the data-set included in the current industry standards, enabling a considerably wider range of elements to be tracked. This provides a far richer source of information than the basic service.
Information is collated at a firm level and Exweb users can log in to see a list of all cases being processed by their organisations.
An “assign to me” button allows administrators to ensure information on individual contracts is directed to them rather than across the whole business. By selecting an individual case, the client record information on the basic case being processed appears on the screen. This includes a detailed section showing all the information that has been requested, who it has been requested from – for example, the solicitor or adviser – the exact information requested, what information has been received and, importantly, when the next action is due on this activity.
I am particularly pleased to see this last item. I have found insurers invariably fail to recognise that if you do not tell the adviser what you plan to do next, the adviser will immediately pick up the phone.
The service also shows the commission details, including the amount, frequency, agency and when commission will start and end.
By clicking on the tracking details icon, details of the basic case can be accessed, and for equity release this indicates if a property value or other information is based on the information submitted with the application or if it has been verified.
Clicking on a history icon brings up a record of all previous tracking updates. This includes a status box which allows the provider to provide any additional information to the adviser.
Where a consolidation exercise is being carried out involving transfers from a number of providers, the annuity service can track multiple transfers.
The present service provides updates based on the progress of the case at close of the previous business day. I’ve long believed that to really reduce the level of telephone enquiries to providers, tracking information should be pushed as soon as there is a change of status on the case.
However, looking at the depth of this new service created by The Exchange and Just Retirement this is a valuable interim step towards a real-time service, and both parties deserve considerable credit for what they are delivering.
I have been shown many tracking services by insurers in the past and, to be honest, until now I have yet to see anything I really felt would make a significant difference to the way advisers are able to process cases.
What really makes this service work is the depth of information provided and the way an adviser can examine the full progress of an application. Linked to a client management system, this data could also be used to generate powerful information both for TCF purposes and to measure the quality of service provided by different insurers.
The Exchange service is already being used to populate information into the Office Web client management system with integration into the Adviser Office software due to be launched next year. I understand The Exchange is keen to integrate this offering with other client management system providers and those software providers would be wise to take up the opportunity.
This service proves it is possible to deliver an enhanced experience to advisers processing annuity and equity release business and I look forward to seeing what the other portals, AssureWeb and Webline, deliver to keep up with this advance.
Other annuity and equity release providers should look to move quickly to deliver similar services. Otherwise, I expect Just Retirement will be able to use this service to cement an impression among advisers that they offer a vastly superior service.