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Set the pace

When it comes to delivering new and smarter ways to do business, protection has long been the product type that has seen the greatest innovation from providers. In November, the FTRC research team will begin the workshops in preparation for delivery of the 2007 Protection e-Excellence ratings.

While the ratings themselves will not be published until the dedicated supplement with the April 26 edition of Money Marketing, the process for gathering the analysis on which the ratings are based begins, as it does with all the e-Excellence supplements, six months earlier.

Initially, we will be holding a series of workshops, one- to-one meetings and online conference calls with leading protection advisers to begin the process of identifying those areas of provider services that are most valuable to advisers and have the greatest influence on provider selection.

Because of the major and varied advances that have been delivered by so many insurers, it is increasingly important to recognise where such enhancements are a major benefit to the adviser and their clients and where they are rather more window dressing. As can be seen from the supplement on the Retirement Options e-Excellence ratings that accompanies this week’s paper, it is easy for a provider that does not continuously evolve their service to fall behind quickly in the ratings.

The pace of change and the extent of competition in the protection market are such that even the best providers need to keep subtly extending what they are offering if they are going to stay ahead of the game.

For 2007, we will be introducing an additional product category for rating pension term assurance. There has been an intense debate since April as to the extent of the opportunity that is provided by this new product and it will be fascinating to be able to identify to advisers those providers whose services offer the greatest functionality.

Some insurers have launched a consistent e-commerce proposition for all protection products whereas others have chosen to focus on individual product lines, which leads to some interesting dichotomies and makes it essential that we assess providers’ offerings at the level of each type of cover rather than trying to give a single product rating for all protection offerings.

In a market many say is already overpopulated with providers, there seems to be no shortage of additional providers wanting to enter the market and attract their own a slice of the market share.

This raises the question of how much functionality do you need to deliver to bring a new provider proposition to market? Is it viable to enter a relatively limited range of e-commerce services and then build on your proposition or are their elements of services without which it is simply not worth entering the market because you will not be judged as credible?

Also, how widely should a new provider offer a service initially? Growing volumes and being able to manage the inevitable glitches that will arise with any new system makes a lot of sense but once a provider does want to go for growth, with various major distributors increasingly reliant on a specific portal and/or client management system, provider integrations and partnerships having the right relationship with the right technology suppliers can have a significant effect on a new player’s ability to develop their market share. In the past, we have tended to base our analysis on the ability, or otherwise, of providers’ to deliver a service generically. However, with the increasing reliance advisers’ place of different portals and client management systems our analysis now focuses on, and differentiates between, the various technology suppliers.

During the last 12 months, we have seen more and more providers begin to deliver tracking services enabling advisers to monitor the progress of applications. This is just one example of where we are increasingly going into greater and greater granularity with the studies. The additional value that can be delivered to an adviser by keeping them up to date with the very latest progress on applications is considerable and I do expect that this will be a factor that considerable weighting is applied to in next year’s study.

But it is significant how many advisers can actually access these services. If a provider has developed a highly functional service but only deployed it across a narrow distribution channel, this limits the number of advisers that can benefit. Some of the additional research and analysis we are able to provide to individual life companies through these studies is identified on page 11 of this week’s e-Excellence supplement so I will not repeat it here. What was not examined in that commentary, however, is the ability we have now developed to be able to offer major advice firms bespoke measurement of providers’ that focuses on the extent to which different insurers are able to deliver information to systems operated by their preferred technology suppliers.

While the full e-Excellence studies measure and rate a provider’s e-commerce proposition overall, taking into account their links with the full range of technology suppliers, adviser specific studies focus on providers’ links solely with that adviser’s chosen technology supplier. For example, if an adviser has chosen to use Exweb as their portal and Intelligent Office as their client management system, a report can be generated that ranks all the product providers in terms of their links with these individual systems. Equally, if another adviser uses AssureWeb as their portal and Quay Software as their client management package, this might produce sharply contrasting results and a different ranking for providers.

Such differentiation is becoming increasingly important, given the significant variation in the extent of pre-population between different insurers electronic applications and the various portals and client management systems.

In order to ensure that the questions for any study are suitably crafted and include the full array of different services that providers’ offer, we do now also carry out a series of provider workshops so that those organisations that have subscribed to the full e-Excellence research can assist in ensuring that all possible areas of providers’ services are examined however the scoring matrix, that is, the benchmark against which all providers are measured, is designed only by FTRC in consultation with adviser firms.

Because of the increasing use of automated underwriting engines, we will for the first time this year also be holding workshops with reinsurers and insurance system providers to assess the impact of their differing offerings on the market so that these can also be taken into account in the research. The e-Excellence studies have a demonstrable influence on the way product providers now develop and prioritise their services.

They have created a virtuous circle where the advisers work with us to define the services they consider most valuable, we measure provider’s ability to deliver on such services and for those provides who want it, can also generate a specific analysis of the enhancements they need to make to their e-commerce propositions market leaders.

Participating in this process is one of the best ways in which advisers can influence the services providers’ deliver. Advisers, providers, technology suppliers and re-insurers wishing to participate in e-Excellence workshops should contact samantha. smith@ftrc.co.uk for more information.

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