From the cradle to the grave?

Welfare reform means that employers will soon have a far greater responsibility to look after the health and wellbeing of their workforce. But are the slight service level improvements being witnessed in the group risk sector enough to help them on their way? Edmund Tirbutt reports

If you mention group risk to intermediaries they will instantly start spouting forth about unacceptable service standards, and if you mention group risk to insurers they will point to the huge improvements they have made over the last year. However dig you deep, the two sides of the story just never seem to add up.

But one slight variation on the theme is that the bulk of intermediary grievances now refer to after-sale and renewal service standards, as opposed to the time that it takes to obtain initial quotations.

Initial quote turnaround times have undoubtedly improved, with many intermediaries expressing broad satisfaction that most quotes are now obtainable within 10 working days. A couple of years ago, however, quotes often took twice as long and, in extreme circumstances, could take several months. Now even the disenchanted minority do not paint anything like such a bleak picture.

Philip Thorpe, group consultant at national specialist intermediary IHC, says: “They need to turn quotes around in five working days but are generally taking between seven and 15 and, in a worst case scenario, as long as a month. I have no doubt that if one company was consistently quickest at quoting they would get more business. Group private medical insurance (PMI) providers tend to give quotes within two working days and, although the information required for group risk is usually more detailed, if one provider started providing quotes consistently within four days they would stand out.

“But they know that most IFAs will get quotes from all half a dozen players and will wait for the slowest because an IFA would have to demonstrate a very strong argument for not putting all available providers forward. It’s also one of the worst kept secrets in this industry that some employers get more than one intermediary to quote, even though there is no real benefit in doing so because insurers don’t dual price. This practice clogs up the system and it would constitute a real step forwards if employers could end it.”

Canada Life and Norwich Union Healthcare already report that they aim to deliver quotes for small companies within five working days and that they manage to achieve this in most cases. The former even claims to take as little as two working days on occasions. BUPA, which measures its quotation speeds on a weekly basis, is also notable for referring to an average quote turnaround time of 6.4 working days for all sizes of company.

When it comes to post-sale administration, however, there is clearly still a massive uphill task facing providers. They have to cope with huge peaks and troughs in their workloads, a continuous stream of regulatory change requiring new documentation, and the difficulties involved with trying to motivate the type of “jobsworths” that tend to work in mundane administrative roles.

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