The Importance Of Retention Strategies

Cost of living challenges are affecting us all both personally and professionally. We know advisers are worried about how to talk about protection with customers in this challenging market, as well as being concerned about how many policyholders may choose to cancel their cover. It should not be viewed as all doom and gloom though.

Consumers need advisers more than ever to support them through this economic downturn, helping them to make the right choices for themselves and their families. Protection insurance is a key part of this, providing a valuable financial safety net in case death or illness strike.

Given the current climate, it’s more important than ever for adviser firms to have a robust retention strategy. However, the insurer Guardian recently conducted an adviser survey and their findings showed that 47% of advisers do not have any retention strategy in place which is a worrying statistic. A further 23% said they had a retention strategy, but had not adapted it in response to the current economic situation. There are a number of aspects to consider when thinking about how to retain customers and we can support you with this.

Proactive communication with customers is really important at this time, reminding them about the cover they have in place and the value of those policies which could be through a variety of methods such as telephone reviews or emailed mailers. Protection provides a great opportunity to keep in touch with mortgage customers, especially those who opted for a five year fix; contacting them during this five year period helps you to secure their future mortgage custom as well as ensuring they have valuable protection cover in place.

The key thing is to maintain a strong relationship with customers. Some firms send out bespoke annual statements, others might send out more general quarterly newsletters. Promoting the range of added value services available with insurance policies such as 24/7 virtual GP access and counselling is also beneficial as this helps them to get tangible value from their cover; customers using these services and benefitting from them will reduce the risk of them cancelling.

Keeping in contact with policyholders will also encourage them to call their adviser if they are having any financial difficulties or have any questions about the continued suitability of cover, rather than simply cancel their direct debit. It's much easier to help a policyholder before they decide to cancel cover than once they've made that decision to do so.

The adviser can then talk through the different options which may be available as opposed to just cancelling cover. For example, taking advantage of the payment break options that insurers have, reducing the sum assured and for income protection plans, extending the deferment period could also be a consideration to help the policyholder save money. There are a number of ways of reducing the premium which is better than simply going without cover at all.

We contributed to two retention guides produced collaboratively by the Protection Distributors Group, the Income Protection Task Force and the Association of Mortgage Intermediaries, three industry organisations of which Sesame Bankhall Group are members. The guide designed for advisers (and produced by advisers) provides a wealth of practical retention-focussed information, and there is a simpler consumer version (which can be shared with customers) that urges consumers to talk to their adviser or at least their insurer before cancelling to explore what options are available.

Emma Thomson Head of Protection & GI Propositons

Whatever good advice can be given by advisers though, there will still be some customers that experience real difficulties, so we are also encouraging advisers to signpost these customers to organisations that can help, such as the charity ‘Turn2Us’. Turn2Us helps consumers identify if they could be entitled to state support as well as other helpful information about money matters. Their website, to find out more, is www.turn2us.org.uk.

There's so much advisers can do to help clients be as financially resilient as possible, and in these challenging times, consumers need advisers more than ever. If you’d like help in developing a retention strategy for your business, please do speak to your Regional Key Account Manager.