Outsourcing Your Clients’ Claims?

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Would you consider outsourcing your clients' claims to an advocacy service in order to devote more time to building your business?

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Our latest poll asks you to consider one of the most fundamental services you provide to your clients: helping them with their claims.

We’re asking you this question because of a trend across the Tasman, which is seeing the emergence in Australia of life insurance claims advocacy services.

These services are being developed from within the life insurance sector by dealer groups, single risk advice businesses or former life company claims managers. (We’re not referring here to external advocates such as specialist injury legal firms.)

The rationale for the emergence of these services relates in part to offering expertise to …advisers and advice businesses who are increasingly time poor

The rationale for the emergence of these services relates in part to offering expertise to non-advised clients who may be making a claim, but also to advisers and advice businesses who are increasingly time poor and/or who don’t have sufficient experience in dealing with the often complex issues associated with successfully guiding their client through the process of a claim (see: Lack of Time Driving Advisers to Claims Services).

Would you consider using such a service here in New Zealand? Do you use one now?

As our industry undergoes significant change with the impending introduction of the Financial Services Legislation Amendment Bill and the implementation of the Code Working Group reforms, we’re confident that the regulatory and administrative burden faced by advisers and advice businesses in New Zealand won’t reduce any time soon, and will most probably increase.

Will you have enough hours in your day in future to give your clients your undivided attention when it comes to their claims? A growing number of your peers across the Tasman are reaching a tipping point, at which the prospect of outsourcing their clients’ claims processes to a trusted advocacy group is becoming more realistic (yes, the claimant must pay a fee to the advocacy firm).

Or do you believe that, irrespective of how many hours you may or may not have to devote to your clients’ claims, you would never – ever – outsource this service under any circumstances?

The New Zealand life insurance industry follows its own development path and will always do things its own way. But we’re flagging this issue now, in case a similar trend does find its way into the NZ advice sector.

Tell us what you think and we’ll report back next week…