Autumn 2017 ISSUE
FIRST COMMENT IN THIS ISSUE: • SIX STRATEGIC FACTORS TO IMPROVE RESULTS FROM EMAIL QUOTES • E-CONVEYANCING: WHAT IS IT REALLY? • UNDERWRITER CASE STUDY - DEVELOPER’S POLICY: WHEN SHOULD TITLE INSURANCE BE OBTAINED FOR A DEVELOPMENT? • PRODUCT CASE STUDY - PROPERTY ENQUIRY CERTIFICATE
Leading Title Insurance
Welcome to the autumn edition of our newsletter. In this issue we have contributions from our regular writers. Firstly, we have the third of four submissions from business development expert Professor Ian Cooper. He sets out six strategic factors that will help convert your email quote letters into actual business. Professor Stewart Brymer looks at our aspirations for a modern digital economy and how that needs to drive e-conveyancing. Our underwriter contribution for this quarter comes from Laura Lapsley, who asks when should title insurane be obtained for a develoment?
Six strategic factors to improve results from email quotes By Professor Ian Cooper Law firm skills trainer / consultant, Author of the Financial Times Guide to Business Development
Do you send out an email quotes letter to people who have rung for a residential conveyancing quote? What proportion of your email quotes letters convert into business?
Of course it is a good thing to email a potential client details of your conveyancing quote, BUT there is a massive general problem, which is having a seriously detrimental effect on conversion rate results for many firms. The major problem is that 69% of firms have fallen into a default system of using email as a way of actually avoiding a meaningful and influential conversation at all with a potential client who has telephoned for a quote. These firms and their call handlers are doing no more than simply taking basic potential transactional details … “buying / selling / freehold / leasehold / what price are you buying or selling at etc?” … and then … “we’ll get an email quote out to you”. The send button is hit, the email quote has gone. Job done … or is it? Many of the firms who do this actually pride themselves on their efficiency for speeding up and simplifying the process. It might be quicker, but if the results are poor, it is false economy.
Many firms are failing to realise that this method limits conversion rate success, as no relationship is built with the caller, control is lost the moment the send button is pressed and it virtually forces the prospect to choose on price! The shocking truth is that there is a nationwide catalogue of missed business opportunities, over this issue, with the vast majority of firms seeing the email quotes letter as a purely administrative task. Many firms have failed to realise that their email quote letter is actually a ‘sales’ letter with a promotional and marketing objective. So, following a substantial review of this issue, here are the six key mistakes that many firms make, that need to be addressed if they want to improve their conversion rate of email quotes letters into profitable business.
Failure to differentiate – 84% of quotes emails sent out contain no information about the firm or communicate any potential benefits of using the firm at all. The only content is merely a list of prices. This virtually forces people to choose on the cost factor only. Is that really what you want? Ask yourselves … why should a potential client should choose you? Then make sure you include some of these reasons in your email letter.
Refusal to give a verbal quote – I have already mentioned that 69% of call handlers only want to take the transactional details and send out an email quote. However, it is also worth noting that when pressed for a verbal quote over the phone, two thirds of call handlers refuse to do this and use a variety of reasons and excuses such as ….
“It’s easier for you to understand if it is in writing”. “It takes too much time to run through all the figures and I’m very busy right now”.
Lack of the email being personalised – 97% of all the email quotes letters in my research showed no effort at personalisation at all, other than the caller’s name being inserted into the auto format template of the email quotes system. 4
FIRST COMMENT We also had many letters signed for example … “Kind Regards – Conveyancing Team (Name of Branch Office)” The simple truth is that the more personal the better. Remember, your prospective clients don’t really want ‘conveyancing’ at all. To them, this is in most cases about ‘moving home’ and that is the biggest single thing in their lives at that moment. This fact alone deserves some personalisation!
Too much focus on terms & conditions – 38% of firms open, or mention very early on in their email quote letters over legalistic terms and conditions, sometimes even prior to anything else. Here is a real one I recently reviewed:
The basic rule in sales, is to make it as simple as possible for your potential client to see what they need to see. How would you feel if there was a separate attachment that you had to open for each of the paragraphs in this article? Do what you can to send out an email with all the content contained in the body of it.
Too many errors in the emails - Believe it or not, in 56% of the large number of email quotes letters that I have reviewed, I found serious sloppy errors, which can only have a negative and damaging effect on getting a conversion. For example: •
The wrong name being used.
The name of the person spoken to, being different from the sender.
Hardly a great and friendly opening to a ‘sales’ letter to someone you hope will choose to spend £1,800 with you!
Spelllin erorss throught the qote!!!!! (Irritating isn’t it? Hardly demonstrates your attention to detail).
However, important as this information is, timing is hugely important in the world of sales. It certainly shouldn’t come first.
Again, all inappropriate to what is essentially a sales and promotional letter that you hope will influence the recipient to ‘actively want’ you.
Your email letter should be personal, seek to influence the potential client to ‘actively want’ your firm and then provide the factual information they need in plain English.
“This letter is an indication of charges on the basis of details presently known and on the assumption that the transaction(s) will not prove to be substantially more complex or time consuming than expected etc. etc.”
Attachment fixation – 72% of firms don’t put the information within the body of the email text itself, but have multiple attachments to the email.
Whilst I understand that this is driven by some of the many email quotes software applications that are available, it doesn’t alter the fact that in many cases this is simply irritating and less effective from a sales and marketing perspective. At least half of those that go down the ‘attachment’ route had five or more attachments to open separately!
If you are simply taking the basic transactional details, inserting these into data fields on your screen and pressing your send button, you are almost certainly limiting your conversion rate success. You must build rapport with your caller; give your fee verbally; talk it through with them and only then, send out your email quotes letter, if there is still some doubt over them going ahead. Anyone who has a question, or who wants more information or training on this can contact me directly. 5
e-conveyancing: what is it really? By Professor Stewart Brymer Brymer Legal Ltd
The story so far
e-conveyancing has been an often-used phrase in conveyancing circles, but what does it mean? It can perhaps be more accurately defined by what it is not. In some respects, finding a solution to making the conveyancing process more functional in a digital economy can be viewed as the Holy Grail with many people having thought that they have found the solution at one time or another. When such examples are analysed however, it is often the case that all that has been achieved is an extended form of practice case management. Such developments are, of course, welcome as they assist the better running of a transaction whether that be during the estate agency or conveyancing phases thereof, but they are not a full e-conveyancing solution.
The common denominator in the attempts which have been made to date to introduce an e-conveyancing solution is that they have generally all been â€˜bottom-upâ€™ initiatives with the goal being to make the existing paperbased system more efficient. This has been done by simply replicating that process in an electronic manner. That only takes you so far however. The end result appears to be different but, in essence, they are just the existing systems clothed in a different way. All such systems suffer from the same problem, namely user apathy. Put simply, if there is no incentive to change the way in which we work, change will not happen any time fast. The system will eventually be ground down. The best example of this was
the hugely expensive failure in England and Wales of Veyo – www.veyo.co.uk. Veyo was designed to be a cloud-based tool, where conveyancers could communicate with each other through an online portal, and upload search results, documents for approval and amendment, and other relevant information. It offered workflows that included anti-fraud checks, and other electronic processes that need to be carried out, as well as diary reminders for when tasks need to be done. It also provided a tracking system which recorded key steps by each conveyancer in the chain as they happened, so that progress could be monitored by what was called a ‘Chain View’ by estate agents, buyers and sellers involved, and the points of delay identified. In addition, it promised integration with other relevant systems, like Land Registry and HMRC records. Those behind Veyo claimed that the portal would cut the time of the average transaction by two weeks. A number of parties expressed disappointment in what actually was on offer however with it being noted that most firms already had their own case management systems that incorporate anti-fraud and other essential processes to make the conveyancing process run smoothly. As a result, they did not want to pay an additional cost for something that duplicated some of the processes. When Veyo went live, it did so without certain key elements of integration. In addition, while a lot of conveyancers had registered an interest in Veyo, not many firms had actually signed up to use it. There was no incentive for conveyancers to incur a significant cost by subscribing to Veyo
as subscription was not made mandatory for solicitors by the Law Society of England and Wales. Ultimately, Veyo was beaten to the punch to deliver a vision for e-conveyancing by other providers committing to bring free products to market within case management software. In Scotland, a similar approach to Veyo has been launched by the Edinburgh Solicitors’ Property Centre with backing from The Law Society of Scotland. That initiative is called ALTIS – www.altislegal. com. Early signs are that ALTIS is being well-received but, like Veyo, uptake has been slow. It is suggested that this is because everyone makes the same mistake of thinking that e-conveyancing is a technical project. It is not. It is a business and paradigm-based problem. In the end of the day, money drives the system and unless mortgage lenders make it mandatory for conveyancers to subscribe to a particular system by refusing to let them handle mortgage completions unless they do so, any ‘bottom-up’ approach will not succeed. Mortgage lenders are therefore key influencers in any change to the conveyancing system.
So what is the solution? It is suggested that the way in which to effect change is by focusing on the system of funds transfer. This is a long overdue reform. It is simply not good enough in this modern age that funds cannot be
transferred instantaneously in a secure manner. A good example is what has happened in Australia where a customised settlement solution has been developed by a company called Property Exchange Australia Limited (‘PEXA’) - www.pexa.com.au. This has been achieved in consultation with all eight Australian Land Registries, the major banks and legal and conveyancing bodies. The result is an unprecedented achievement in both intergovernmental cooperation, and public / private sector alignment; a success many other countries are now trying to emulate. Initially, PEXA, like other innovators in the field, sought to introduce an e-conveyancing solution. It soon realised however that it was not the property business it was in, but the exchange business, therefore making the network of financial institutions, practitioner firms and government of critical importance. While take-up of the platform was strong, early adopters found little joy in being the first to ‘go digital’ – a similar outcome was found when solicitors in Scotland started using Automated Registration of Title to Land (‘ARTL’). PEXA understood that to be a truly effective exchange, all parties to a transaction needed to be online, and part of the network. This was a point of contention for the business as customers were forced to maintain processes and resourcing around both manual and digital property settlements. Once it was appreciated that it was the exchange business that it was in, which by its very nature depends on the network, PEXA quickly made inroads into identifying the solution. However, with half the market happy to stick in the ‘horse and buggy’ era, bringing the rest of the market onto PEXA became the biggest challenge. That challenge was met as a result of the level of collaboration among all major players however and the fact that a rolling programme of digital processes being mandatory was introduced. By moving property transactions online, Australians now benefit from a faster, safer and more efficient property exchange process, free from delays caused by manual errors which previously impacted a third of all settlements. 8
Conclusion The way in which we all transact business generally has changed dramatically in a very short period of time. The conveyancing system needs to change now. Because it has always been done the way it has for many years should not be an obstacle to introducing improvements to a process which is in need of reform. The Government has indicated that it wishes to see changes to the house buying / selling process which is a positive driver. Do we really aspire to have a modern digital economy in the UK? If the answer to that question is yes, then we must make structural changes to the way we work in order that we are ready for a fully electronic market. Registers of Scotland (www.ros.gov.uk) and HM Land Registry (www. landregistry.gov.uk) have already embarked on their Digital Transformation Programmes. This will lead to a rolling programme of change whereby existing paper-based work practices will be departed from. This will take close collaboration among all those currently engaged in the conveyancing process. Only by such network collaboration will conveyancing be brought into the digital economy – hopefully without too much kicking and screaming. This is going to happen and, as ever, the first step is always the hardest. In my opinion, we can learn from the Australian experience. The world really is a small place.
Developerâ€™s Policy: When should title insurance be obtained for a development? By Laura Lapsley Assistant Commercial Underwriter
A solicitor acting for a purchaser or developer of land may be required to arrange title insurance for their client. However, how do they ensure that the policy is completely tailored to their clientâ€™s needs and that their client is fully covered throughout the entire development process from start to finish? First Title can offer insurance based on continued use land, as it stands currently, or land which is to be developed or built upon. When the intention is to develop land, and a title issue comes to light, the solicitor / developer has to decide not only whether to insure the title defect, but also at what point title insurance should be obtained. There are many legal and financial factors to weigh up, and timing can be of vital importance.
Pre-Planning: An instructing solicitor may decide to obtain insurance at the earliest possible stage, and more often than not, before planning has been submitted or approved. This early stage may involve marketing / advertisement of the site and neighbour notifications which may lead to awareness of the risk in question, and potentially trigger a claim. Therefore, the solicitor may not wish to wait until planning has been obtained, as their client could be left exposed to a claim in the meantime. However, it must be noted that, given the exposure at this stage, and depending on the level of risk it is likely that the premium will be higher than if planning permission had already been obtained. Also, there is a concern that the solicitor may expend time and money obtaining a title insurance policy, only for planning permission to be refused.
Post-Planning: Alternatively, the solicitor may decide to take a view and delay insurance until planning has been granted. This way, they have the certainty that
planning is in place and the development is ready to move forward. At this point, First Title has the benefit of assessing whether the planning process has flushed out any potential claims, and we are able to view any objection letters received. For this reason, post-planning cover often will incur a lower premium, however, it could be the case that waiting to insure on a post-planning basis may expose the developer to pre-planning risks in the interim period.
Developer’s Policy: There are different benefits to both pre and postplanning policies, and the nature and timing of the development will dictate which type of cover is more suitable for the insured’s needs. First Title acknowledges that there are different factors to weigh up in choosing the best cover for your client and so have created a policy which aims to bridge the gap between pre-and post-planning insurance. Therefore, a third option is available in the form of our Developer’s Policy. The Developer’s Policy is split into two stages. Stage 1 covers the risk(s) during the pre-planning stage. At this point the insured only has to pay a proportion
of the overall premium (typically 30% - 40%). The Stage 2 premium only becomes due upon obtaining planning permission for the proposed development (or if First Title indemnifies a claim). Provided the insured pays the Stage 2 premium, First Title’s cover from commencement is seamless. In the event that the desired planning consent is not obtained, the insured does not have to pay the Stage 2 premium, and makes a significant saving.
Benefits of the Developer’s Policy: The Developer’s Policy allows the insured to minimise their risk upon acquisition, covering any claims which could arise in the pre-planning stage, and at the same time avoid paying a high upfront premium amount, should the planning application be unsuccessful. This can assist the developer in managing their cash flow more efficiently, which we acknowledge can be crucial to the success of any development. It is worth noting also that the lender is insured for the full amount of lending at any given time. This provides comfort to the lender and can help the transaction run more smoothly. Title insurance can also make the site more marketable and offers comfort in onward sales.
The Developer Policy can help to establish a relationship between the insured and First Title at an early stage, meaning that First Title and the insured can work together effectively to ensure that the developer is fully covered throughout the development process. The insured can proceed with planning applications with support and advice from First Title to ensure compliance with policy terms. Additionally, as the insured has an obligation to keep First Title advised of any circumstances which may lead to a claim or impact on the risk insured, First Title can keep on top of any potential claims at the earliest stage possible, and, where necessary, take proactive steps to resolve the issue for the insured. If you do find yourself in a position where your client may require cover for a development, First Title will be happy to provide guidance and discuss available options to find the most suitable and comprehensive cover for you and your client’s needs.
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First Title Insurance plc is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. First Title Insurance plc is registered in England under company number 01112603. Registered office: ECA Court, 24-26 South Park, Sevenoaks, Kent, TN13 1DU.
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Product Case Study:
Property Enquiry Certificate Background
First Title were approached by a solicitor acting for a client who was taking a seven year lease of a unit within a food court, in a new mixed use development. The client required cover for the lack of a Property Enquiry Certificate as they wanted to complete the lease in order to start trading once development was finished.
First Title provided a Known Risk title insurance policy with a Rental Liability endorsement. This meant that the tenant could complete the lease with the security that if there was anything which prevented them from trading in the future and which would have been revealed by a Property Enquiry Certificate at the point of completion, then the First Title policy would respond.
Ramifications of risk The unit was newly built and so had no history of trading. The failure to obtain a Property Enquiry Certificate meant that the client could not be certain that the unit had clean title or that they would not be prevented from trading.
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First Title Insurance plc is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. First Title Insurance plc is registered in England under company number 01112603. Registered office: First Title Insurance plc, ECA Court, 24-26 South Park, Sevenoaks, Kent TN13 1DU.