182 | Growing your quality advice business successfully with quality CIC solution

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  • Hilary Banks, Sales Director, Guardian Financial Services
  • Phil Deacon, Head of Claims, Guardian Financial Services

Learning Outcomes:

  1. To understand how the pandemic and new regulation is influencing the critical illness protection market
  2. To learn the common triggers of critical illness protection as well as understand what a claims process looks like
  3. To gain an understanding of the different types of policies available


SOFIA: Hello and welcome to our panel today: how to grow your advice business with critical illness cover solutions. I’m joined here by experts from Guardian. I have Hilary Banks, Sales Director, and Phil Deacon, Head of Claims. So if we can start with you, Hilary, which is business opportunity, how much of a demand is there for this type of product? HILARY BANKS: There is massive demand. I think where there is a need for anything there has to be a demand. I think we’ve got a massively underinsured population in the UK. The FCA’s Financial Lives Survey last year actually said that 31% of the UK population have currently got life cover in place and by contrast only 14% have any critical illness cover. So we certainly have, we have an underinsured population and I think where there is obviously a need identified, we have to try and help the industry to create that demand certainly. I think from a customer’s point of view, you’d be fortunate if you didn’t have a need for some sort of protection. And if you think about what protection is designed to do, so you would take a protection policy in the event that you want to protect your wealth, if you wanted to protect an IHT liability, if you wanted to protect school fees for your children, if you wanted to protect your loss of income. If something were to happen to you and you can’t work, where is your income going to come from and how are you going to replace that. So there are so many different reasons that an adviser and a customer needs to consider that protection need. I think it would be unusual for a customer to be able to identify that need themselves, really unusual. Ultimately, they’re going to that adviser for advice on all their financial planning needs, and that includes their protection needs, and I think to hope that a customer can identify that need themselves is unlikely. But actually also do we want customers trying to navigate all the different protection policies and all the different providers that there are in the marketplace and to try and make that decision for themselves, so I think that’s quite difficult. I think there’s a misconception - and I’m happy to be challenged on this - I think there’s a misconception that protection is a difficult conversation to have and I will explain why I think that. I think we have created that misconception in our industry. Because, like any product, if you don’t have the confidence and the knowledge to talk about that product confidently I think any product would be a difficult conversation to have. And I think financial advisers have got a really difficult job sometimes that we probably need to recognise, they’ve got to try and keep pace with all the different products and solutions that are available in the marketplace, and that can be daunting. And I think if they are lacking, protection isn’t something that they sell all the time or they haven’t in the past and they’re lacking that confidence and knowledge in the product, then I think it will feel difficult to sell. But actually if you’ve got expertise within the business, it shouldn’t be a difficult conversation. You’re giving your customer the facts about a solution to a need that they have. So, long answer, but there is definitely a demand, there’s a massive need for protection in the UK. PHIL DEACON: And I would like to just add to that, Sofia, because I think people do have specific needs, so most commonly, for example, to protect a mortgage, maybe other loans and that type of thing. But at claims stage what we also see is that if somebody suffers a life-changing illness, sometimes they just need to take time out. They need to adapt their home. They may need further specialist treatment that’s not available on the NHS, and that’s certainly truer now than ever. So I think sometimes protecting a need is really important but also just having a sum of money that allows you to adapt and deal with a life-changing illness and I think that’s really important as well. SOFIA: And maybe five years ago we wouldn’t have spoken about things like that and people wouldn’t have thought what if I got ill, but we have just had a pandemic, as we know, so that illness, that work disruption, it’s at the front of everyone’s minds. How has that changed the perception? HILARY BANKS: Oh it’s shifted it enormously. I think we’ve got massive consumer awareness now, more than we’ve ever had, about the risks to our health and wealth. And I think we, you know, as an industry, have got to try and seize the opportunity that we’ve got now. And actually Guardian did a survey, so at the beginning of the pandemic we did a survey, and we were surveying advisers to ask is there an increased willingness from their customers to talk about protection. And 75% of advisers that we spoke to at the time said that they saw an increased willingness, which we recognised as well; 83% of advisers who didn’t usually talk about protection with their customers were saying that they now are as a result of the pandemic, which is absolutely amazing. So it’s just helping advisers feel more confident about having those conversations. And 38% say that they saw an uplift in protection sales as a result of the pandemic, so again just really good momentum. So I think if there’s something positive to take from the pandemic, certainly this heightened awareness. But we have got to seize that opportunity because it won’t last forever, or it might not. We’ve got the demand, we’ve got a customer need, we’ve got the benefit of the pandemic meaning that people are more open to have those conversations and I think we’ve got to try and help advisers to make sure that they feel adequately trained and they’ve got knowledge of the products that are available and all the different tools that are available to them to make sure that we’re having those conversations adequately with customers. SOFIA: And what kind of customers is this for: is it generally older customers or is it people younger or with families who should be looking at this kind of thing? HILARY BANKS: So as I was saying earlier on I think we’d be very fortunate and very few people would be fortunate enough to say that they didn’t have a protection need or for an adviser to say that they didn’t have a protection need. Most people will have a protection need of some description and that’s whether they’re trying to protect cash into their investments, whether it’s their wealth, whether it’s IHT, whether it’s their families, their children’s school fees, as we talked about earlier on. So there’s a whole heap of customers that have a need for protection. And I think we talked about earlier on as well, life cover is currently the most commonly taken insurance product or protection insurance product with 31% of the UK having life insurance, and by contrast only 14% have critical illness, and yet we are more likely to suffer an illness, a serious illness in our term than we are to die prematurely. So I think it’s about making sure that customers understand and that we’re going through that process with them of identifying that need, of having that conversation with them really early on in their financial planning process so that we’ve sown the seed that we’re talking about all of their financial planning, which includes protection, so that they appreciate and are susceptible to having that conversation with their adviser when it comes to it. I think one of the things that is important with critical illness is that quality is key. Like many products that we buy, quality is really important. And I think from a customer’s point of view I think ultimately you’re buying protection insurance because, well, you actually don’t want it to pay out at all because that would be bad. But actually if you were to claim, you want a policy that you can trust, you can have confidence in that’s going to pay your claim at the point that you need it. So I think advisers focusing on quality there is really important for their clients as well. PHIL DEACON: And I have to say, Sofia, that from a claims point of view, we see the people who benefit from these policies. And they’re young people, old people. If younger people think that serious illness only gets you in older age, they’re very much mistaken, because that isn’t the case and we’ve seen some really tragic cases where people have been impacted from serious illnesses, cancers, heart attacks, etc., strokes, at a really young age, so it does happen to people. And again people on small incomes, single mums with part-time jobs, to large earners with high earnings but also high outgoings, and so I think really critical illness is for everybody. And any misconception that it only suits a certain type of person is wrong, because at the claim end of things we see. And whether you’re talking to somebody who has a huge mortgage to protect or a single mum who simply wants to be able to continue to feed her children, you know, I think it’s ever so important. And it’s really rewarding, from my point of view, to actually see how the policies help people at claim stage. HILARY BANKS: That’s a really important point actually, Phil. I think we have the advantage, because of working for Guardian and working for different insurers and working in this industry, that we’ve seen the positive impact of people taking out protection. And, as Phil says, we have the experience of people claiming of all ages. And actually there is a misconception that people that are claiming are older in years or are at the later stage of their life, and actually that is not the case. I think the average age of a claim that’s paid is much younger than people think it is. And it makes you realise that everybody needs it. If you’ve got an identified need, to have it in place, whether it’s to protect you or to protect your loved ones or dependents, it’s absolutely something for all. SOFIA: And for our audience, what are the benefits to advisers, how attractive is this in terms of profit? HILARY BANKS: Massively attractive from an adviser point of view. If they’re looking to mitigate risk in their business, to grow their business, protection is a fantastic opportunity. Advisers have already got the clients, they’ve already got clients there, and if they haven’t been having those protection conversations, I would urge you to go back to your existing clients first and foremost and have that conversation with them. They will have a need or the majority of them will have a need for protection, and that’s your starting point. And I think also there’s an argument around that intergenerational wealth and trying to diversify advisers’ client books or client banks. And if they’ve got a client demographic that is typically much older in age, actually start thinking about your clients’ children and relatives, because actually people that are much younger that might be at the start of their careers with big mortgage debts and young families, protection’s a really good place to start, because they might not yet have the financial planning needs that they might have later on in life, protection’s a really good opener. So actually from an adviser’s point of view to actually diversify that client book and start bringing new customers into that business I think protection gives them a massive opportunity to add value and to bring value in. SOFIA: Looking quickly at regulation, so how is the FCA’s new Consumer Duty impacting this market? PHIL DEACON: I think that, as an industry, things like TCF, Treating Customers Fairly, have been around for quite a while and the publication of claims statistics has been happening now for a number of years and that’s really focused consumer outcomes. And so I think that there’s a huge focus on getting claims paid, on making sure that the definitions are simple and easy to understand. And at Guardian, for example, we’ve tried to make our definitions as easy as we can. Many of them pay out on the diagnosis by a UK consultant. So that provides the customer certainty in terms of when it will pay out and in a way that they can understand. So I think that’s been really important. SOFIA: And, Phil, what would you say to advisers who, they might feel uncomfortable or they might be nervous about bringing up this conversation with the people they work with? PHIL DEACON: Yes, quite simply I would say don’t be nervous. There is some variation. The definitions are fairly similar across the industry, but there is a little bit of variation. You don’t need to be a medical expert to sell critical illness or to understand critical illness. There’s comparison websites available, CIExpert or Protection Guru, for example, where you can go on and compare in some detail the products that are available from different providers to see which is the best and I think that helps advisers make sure that they can understand where the real quality is and not just look at it from a price perspective, because quality is really important and can be the difference between a claim being paid and not being paid. So the tools are there for advisers to use and to help guide them in helping their customers make the right decision. HILARY BANKS: And we talked earlier actually, I mentioned earlier on, I think anyone that isn’t used to talking about protection is ultimately going to feel nervous initially, because it’s- SOFIA: Because it’s something new. HILARY BANKS: -something new, exactly. And I think, as Phil said, there’s loads of tools available in the marketplace to support them, if they’re part of a network or service provider there’s so much available to help them. Their BDMs from all the providers in the marketplace will be jumping at the opportunity to go and support them in it. And I think, coming back to the Consumer Duty piece that Phil was talking about and you were both talking about just now, we have a duty to put ourself in our customers’ shoes and think about how do I want to be treated if I was that customer, and if they have come to their adviser for advice on all of their financial planning, that includes protecting them as well. And I’m sure we’ll come onto it, but it’s OK if an adviser actually doesn’t feel that they’ve got the confidence to have that conversation, but maybe have a think about is there expertise within your business that can help open those doors for you and help have those conversations with your customers so that you’re not leaving your customers in a position where they might have to go and navigate the internet to try and find out which policies they want. SOFIA: Yes, well, I looked into it and I found it quite confusing, yeah, it’s not easy to know what cover you need. HILARY BANKS: It’s so confusing and I feel so sorry for a customer, for any consumer that’s going to try and navigate that. What does a combined critical illness policy mean to a customer, what does a deferred period mean? The list can go on and on and on. So we shouldn’t risk our customers going and buying these products themselves because we’re risking them taking the wrong products as a starting point. But actually advisers do the most amazing job for their customers, you know, what they offer when that customer is coming to them for advice and protecting them and looking at all their financial planning needs is something that I feel immensely proud of in our industry and advisers should feel incredibly proud of the role that they provide and the services that they offer. So I think, from an adviser point of view, just recognise that your customer is coming to you for the advice. They are going to accept your recommendation. And as long as you position protection early in that conversation they should absolutely be taking your advice when you’re looking at positioning a product that fits their need. SOFIA: And on that I guess if there were advisers who did want to move into this space, is it recruitment, is that what they need to do, what are the options there? HILARY BANKS: Yes definitely. So, we talked about it, we touched on it slightly earlier on. Firstly I think an adviser probably needs to ask themselves, is this something that I personally want to do, do I feel that I’ve got the confidence and the knowledge to have those conversations with my customers, and if you do, brilliant. And if you do but you want a bit more training then go to your network or service provider, go to the providers in the market, use the research tools that are available to you. CIExpert and Protection Guru do all this for them. They will compare all the different products in the marketplace and compare them against quality. So I think that’s your starting point. And then, secondly, as I said, it’s OK if an adviser actually says I want to do this but actually I don’t feel that I’m the right person to do it, I don’t actually think that I’m going to be able to have really effective conversations with my customers, and if they don’t, I’d probably suggest, have a look at your business, is there somebody within your business that actually would be great at specialising in protection. We’ve seen massive success in recent years from firms that are specialising in different subjects within their businesses, so have you got somebody with the expertise to specialise, have you got somebody that you want to upskill, a paraplanner or someone within the business that actually might then want to develop their career, and if you don’t, is then it a recruitment tool, so is this an opportunity for you to grow your business. You have the clients who have a need, the demand is there, actually let’s help you put the tools in place to make sure that you can have those conversations effectively. SOFIA: We move now to section number two is, how does the market work and what are the risks? So, Phil, coming to you on this, Hilary said at the beginning that life cover is bought so much more than critical illness cover, why is that? PHIL DEACON: I think life cover is maybe an easier sell. It’s perhaps a little easier to understand. I think advisers probably only have so much time in front of a customer and so quite often I think life cover is the cover that’s put forward as maybe being the most appropriate. It’s one that can easily be explained, you die and it pays out. I think critical illness takes a little bit more explanation. It’s a little bit more complex in terms of the number of conditions covered and that type of thing. But ultimately it’s critically important. And we touched upon earlier that actually serious illness isn’t something that just impacts older people, it impacts everybody, we see that at claim stage. And so I think critical illness, whilst it may take a little longer to explain and to complete an application, for example, it’s really important and it should go hand-in-hand with life cover ideally. HILARY BANKS: I’d agree. I think it’s definitely the complexity piece, you know, it’s much simpler and I think it comes back to everything that we’ve been talking about. If protection isn’t currently something that an adviser is having conversations with and they’re slightly nervous about that protection conversation, your default often will be potentially to go for the simplest or the cheapest products. But actually it comes back to, if we can get advisers confident and in a position where actually protection is introduced in that financial planning journey right from the very beginning so that customer knows at outset that they’re going to be having that conversation with their adviser, I think then ultimately it makes that adviser’s life a little bit easier. Because when they introduce that protection conversation or that protection recommendation, the customer’s looking to them for that. And, ultimately, the adviser’s customer is coming to that adviser for advice. And they should then take that recommendation that’s provided and it will help that adviser to steer away from defaulting to simple and cheap, which is not the right thing for the customer. We talked earlier about the fact that critical illness, quality is key, the quality products give your customers the best outcomes at claim. It gives them the best opportunity to claim on that policy, and that’s ultimately what your customer and what the adviser is looking for. SOFIA: So, Phil, my next question for you would be what kinds of illnesses generally trigger these policies? PHIL DEACON: Well, perhaps not surprisingly cancer is by far and away the most claimed for condition and, yes, the vast bulk of claims we see are for different cancers. Beyond that, stroke and heart attack, you know, they’re the second and third most claimed for conditions, and then neurological conditions like multiple sclerosis. And also children’s critical illness, we see I think the fifth biggest cause of claim is on children’s critical illness cover. And some providers such as Guardian provide that as a standalone benefit now. So if a customer decides that they don’t want to take adult critical illness out, for whatever reason, but they do need life cover, then they can protect their children by adding children’s critical illness cover to the life cover policy. So when you think about children’s critical illness being the fifth biggest cause of claim, it’s a really, really valuable benefit. HILARY BANKS: We’re really proud of that and I think it was really important, you know, Guardian set out to do things differently, and we wanted to make sure that we had products that advisers and customers trusted and products that had much greater outcomes and better claims outcomes, and actually being able to add children’s critical illness to a life only policy is a really important benefit. And actually think about a scenario where a customer, the adult on that policy finds that they actually have the conversation about critical illness later in life or actually when they have already had health conditions and they might find that they’re uninsurable to take out critical illness cover themselves, but they have a young family. The fact that it’s the fifth biggest claim in the UK, it’s really important that we give our customers the opportunity to add their children’s critical illness benefit to any policy. It shouldn’t just mean that the adult lives have to have their critical illness policy as well. So if the adults have got a life-only policy, with Guardian they can also add children’s critical illness to that, and that’s a really important benefit, and I think importantly probably as well that the claims that we’ve paid for children’s critical illness at Guardian have actually all been linked to policies that adults have only had the life-only benefit, haven’t they? PHIL DEACON: Yes, absolutely, the vast majority of claims we’ve paid for children’s critical illness cover have come where it’s been added as an additional benefit onto a life cover policy. So it’s a really, really important benefit. We also allow, you know, if a customer has a policy and then has children, they can also add the critical illness cover later, once the policy’s started, as they grow their family, so that’s also valuable to know that they can do that. HILARY BANKS: It’s also important here as well that, you often hear, we’re talking about the big five conditions that are claimed for, but actually advisers can’t read the future of their clients. We don’t know what the future’s going to look like for our clients. We have no idea what conditions they might or might not have in the future. And actually just focusing on that top five is risky, and actually there are covers that, make sure that you’re offering and looking at products that have really broad coverage, because there are so many other conditions that you’ll know about or that you’ve got friends and family that have suffered from or that your clients might suffer from and they need a critical illness policy for. So I think whilst we’re talking about the top five, let’s not forget that there’s a whole host of other conditions that potentially customers could suffer that it’s really important that their critical illness cover policy includes those as well. PHIL DEACON: Yes and whilst the majority of claims come under those top five conditions that we’ve mentioned, we do see the claims for the less common conditions. And when they do occur it’s so valuable that they’re included, and again the financial benefit and the additional help that claims teams provide is so important, so it’s great to have broad coverage. SOFIA: I’m interested to know, what does the claims process actually look like, so obviously someone might have got that awful news, how easy is it, how long does it take? PHIL DEACON: Yes, good question. So some companies require a claim form to be completed. I think most now probably allow claims to be notified through a customer portal, for example. At Guardian we take all the details on the telephone. The only thing the client needs to do is to provide a signature, a digital signature, so that we can go and contact their treating doctors, as necessary, so we can get the medical information that we need to pay the claim. And it really is that straightforward. The biggest delay, if you like, is in actually getting that medical information from the doctors and most companies chase regularly to ensure that it comes back in a reasonable timeframe. We’ll also ask customers if they have any medical information themselves such as hospital letters that they can provide. Sometimes we’re able to pay a claim without even needing to write out for medical reports, which is fantastic. And we’ll keep the adviser informed as well. We think that’s absolutely essential. So if the notification isn’t through the adviser, we’ll email the adviser and tell him that there’s a claim for his clients and if they wish to be kept informed then we’ll do that throughout the claim and we’ll let the adviser know the outcome of the claim as well when we come to pay it. SOFIA: And how difficult is it to prove a claim, in your view? PHIL DEACON: Most of the time it’s fairly simple. Most of the time it is simply getting the medical report - we obviously go out and ask the questions that we need to, to understand the diagnosis or any other parts of the definition that we need to get information on, and the report comes back and tells us what we need and we’re able to pay the claim. I guess not every medical condition or illness is simple and straightforward. So sometimes a small number of cases can be a bit more complex. We might need to go back and ask some additional questions. We have medical professionals that we can consult ourselves if we need some advice. So yes it’s not too difficult. I think sometimes if there’s ongoing investigations, if there’s not a firm diagnosis, for example, then we might need to wait before we can confirm whether a definition is met, but yes most of the time it’s fairly straightforward. SOFIA: And I guess for advisers maybe one of the worst fears would be if a claim wasn’t paid. How is that avoided? PHIL DEACON: Yes and it’s our worst fears as well to be honest with you. I can assure you that there’s nothing we like less than having to speak to a customer and tell them that we can’t pay a claim. Thankfully it doesn’t happen too often, but I guess one claim is one too many if we’re unable to pay it. So there’s two pieces of advice really. The first is really, really important and every year there’s a small number of claims that aren’t paid because the customer didn’t answer the questions correctly at the application. So the application process and going through the health and the lifestyle questions is so important. So take the time to do that, go through the questions thoroughly. If the customer’s unsure about whether they should disclose something, my advice would be to put it down. And then get the customer to check their answers, get them to contact, email you afterwards or confirm to you that they’ve checked the answers and that they’re all correct and there’s nothing that’s been missed. Most, well, all providers will ask customers to do that as well. But I think if the adviser asks the customer to check the answers and confirm to them as well, it’s just another safeguard to ensure that there’s been full disclosure and that there won’t be any problems at claim stage. So that’s really, really important, we really don’t want to be saying to a customer that you should have told us something when you applied for the policy that means that we can’t now pay your claim, we don’t want to do that. The second one is to make sure customers read the definition and to understand what’s actually covered before they submit a claim. If they’re not sure, then that’s what we’re here for, they can call the claims team, they can tell us their circumstances and we’ll give them some advice on whether they’re able to claim or not. But yes I think they’re probably the two things that I would say to make sure that claims are paid without any problems. HILARY BANKS: And I also think that an adviser’s job is to identify the need and to recommend an appropriate solution for the customer and to help them fill out that application form. It’s our job to make sure that we are asking the right questions for the customer and that for customers that have got complex medical history that we are going out and seeking additional information that we need to underwrite that policy. So it’s our responsibility to make sure that we’re writing to their GP or to the medical practitioners to get any additional information. Most providers in the market now have a presales underwriting line. So if the adviser knows that the customer has got any sort of complex medical history, speak to an underwriter, and that underwriter will then be able to give you guidance as to what to say in an application form, where to put it in an application form. I think from the adviser’s point of view, don’t get caught up on this. The application forms are so much more sophisticated, aren’t they, than they used to be; long gone are the paper application forms that existed 10 years ago that talked in a language that nobody understood, where an adviser was having to handwrite them out and post them to a provider. That’s a thing of the past. All the online application forms now are so intuitive and they’re really clever and they’ve been designed to ask questions multiple times throughout that application journey for a customer to trigger things to a customer. So a customer might, you might ask them a question one way and they don’t recognise that actually they needed to fill that question out, and you ask them two or three times in a different type of way and suddenly they say oh I am taking medication for something that I need to put down on an application form. The industry has got really good now at asking the right questions in really simple, clear language to make sure that we’re encouraging customers to answer those application forms as truthfully as they’re able to. An adviser’s job is to make sure that the customer understands the importance of completing those application questions truthfully and the implications to the customer if they don’t. And that’s where the advisers, their duty is done, it’s then up to us to make sure that we’re asking the right questions and that we gather the information that we need. And I think as long as all that has been done there should be no risk. And the industry sees so few examples now of claims being declined. And, as Phil says, we absolutely don’t want that to happen at all, we’re here to make sure that we’re doing the right thing for customers. PHIL DEACON: Yes absolutely, and I just wanted to pick up on the point that Hilary said about the application questions, because there’s very little, if any, medical jargon used. I remember some time ago that probably some of the questions weren’t the easiest to answer and I think as an industry, and this is what I touched upon earlier when we spoke about the FCA Consumer Duty, as an industry we have been working for quite a few years now to simplify and make things more easy to understand for customers so it’s in their language and not in complicated jargon that can maybe mislead. So yes the questions are fairly straightforward and I think if the customers take the time to think about them, if they check their answers, so many customers don’t check their answers and, fortunately, most of the time that makes no difference to the outcome, but, as I said, just one claim that isn’t paid is one too many. So yes, that’s obviously a good thing if they can check their answers and we can get them all paid. SOFIA: Well, on language, Hilary, because there’s so many parties involved, you’ve got the customer, you’ve got the GP, you’ve got the adviser, the underwriter even, how do you make sure everyone’s speaking the same language? HILARY BANKS: I do feel for advisers. There’s so many different things for them to try and get their heads around, certainly if protection isn’t something that they’re talking about often and all the time, and I feel for customers. But actually I think we’ve just talked about it now, there have been so many improvements made to the way in which we’re asking questions in those application forms, the use of really plain language that’s easy for the customer to understand. We are not expecting the adviser to have knowledge of the different medical conditions and things. We will offer support to the adviser for that. Ultimately their job is to identify the need and recommend the solution. Other than that, let us do our job and we talked about the fact that anyone with a complex medical history, we’ve got an underwriting team that will speak to the customer and we’ve got an application form that’s designed to make sure that we’re extracting the right information from them. The adviser shouldn’t need to get too involved in anything else other than their role and their responsibility at the start of that process. PHIL DEACON: Absolutely. So, at claim stage, we’re very happy for advisers to be involved, we’re very happy to keep them updated on what’s happening, but we’ll be the ones writing to the GP, to the consultant, to get the medical information that we need. Medical language and insurance language isn’t always the same and obviously that’s a problem for us if that’s the case and if we need to seek clarification on something then we can do that. But there’s no need for the adviser to worry about that, that’s what we’re here for. HILARY BANKS: They don’t need to be a doctor. PHIL DEACON: Absolutely. HILARY BANKS: They haven’t done seven years of medical school. PHIL DEACON: Absolutely not, no, absolutely not, no. HILARY BANKS: Yes. SOFIA: We move now to section three, which is how can you choose the policy which is best for your client? So, Phil, how much of a variation is there in policies and what is covered? PHIL DEACON: So there’s a little bit of variation, not too much. Most policies follow a fairly similar pattern. The critical illness definitions, there can be some subtle changes. So it’s important to recognise that and, again, there’s help provided by websites like Protection Guru and CIExpert that will show you what that means to a customer in terms of those subtle changes. Some of the policies have the different definitions grouped by category so it’s a little bit easier to see what’s covered. Some offer slightly simpler definitions and I mentioned earlier that at Guardian many of ours pay out on the confirmation of a diagnosis from a UK consultant. So it’s quite simple for a customer to understand what’s covered and obviously have that certainty that they need. HILARY BANKS: Yes and actually I think also think about customers’ changing needs, actually from an adviser’s point of view that’s also a growth opportunity for them, actually that’s an opportunity for advisers to go back and revisit customers that they might not have done, because we do, you know. Actually my circumstances two years ago, four years ago, 10 years ago were completely different and my needs are completely different as a result, and again it comes back to choosing policies that actually will futureproof themselves with your customers as well so that they will adapt with the clients’ changing needs. And there’s lots of advances to products, but we intentionally actually created, when we launched our critical illness products, so we wanted to make sure that if we make any improvements to the definitions going forwards, that all our existing customers would have access to those. And that’s really important to us, because historically that’s not what happens with critical illness and there’s so many changes to policies, isn’t there, in the marketplace and all the providers are often upgrading their definitions and actually their existing customers don’t get access to those and so we’ve gone through a period where we’ve forced customers to have to cancel existing policies and take out new ones in order to actually take advantage of some of those definitions. And there’s a huge risk there that ultimately the customer is older in age, in which case the new policy is more expensive, they might be uninsurable or they might have had health conditions in that time which means that it’s more expensive for them. So it’s really important that actually advisers, again it’s coming back to the quality, looking to make sure that they are using the tools that are available in the marketplace to recommend quality products that give their customers a far greater chance of pay out. SOFIA: So they would still get the benefit of a new policy even if their circumstances had changed. HILARY BANKS: Yes, so what we say is that if we improve our policy definitions, that all our existing customers will have access to them, which is really important, but we’d still recommend that an adviser would go back and revisit customers to make sure that they actually can. But there’s lots of things like guaranteed insurability options and different things that will support that too. SOFIA: And how important is cost to customers? HILARY BANKS: I think we’ve talked misconceptions a lot today but I think, I genuinely believe there is a misconception that customers, that price is really important to them and that they want to keep the cost down. We don’t operate like that in anything else that we spend our money on, generally speaking, and I don’t think protection should be any different. And again it comes back to where was protection positioned in that financial planning conversation, has it been positioned early with the customer, does the customer realise the benefits and the value of protection and ultimately an adviser believe in what you do. You do an amazing job for your customer. They have come to you for advice, they don’t know what they should and shouldn’t be doing, you know, be proud of that and actually just believe in the fact and take confidence in the fact that your recommendation should be what your customer accepts. And if you’re recommending a policy that is the quality cover that’s more likely to pay out, then in the most part I’d like to think that your customers would take that recommendation. And it steers you away from that territory of price, of price comparisons, of potentially putting your customers in a position where they’re having an inferior product. SOFIA: And coming to you, Phil, Hilary touched on it, people’s lives do change, they might have children, they might change jobs to work on an oil rig or something like that, how do you futureproof policies? PHIL DEACON: Well, firstly, when an applicant is taking out a policy, they have to answer the questions that we touched upon earlier. And then once the policy goes on risk then that’s it, there’s no need, if their health changes there’s no need for them to notify us, unless they need to make a claim of course. So, as they get older, as maybe their health deteriorates, that’s not an issue. And actually buying critical illness as a younger person when you’re younger and healthier, it means it’s cheaper, so that’s a really good thing. Hilary was touching upon the cover upgrade that Guardian offers. So that’s where Guardian will look at the definition that was sold to the policyholder and they will look at their latest definition and they will consider a claim against both. So that’s futureproofing the policy and I think that’s really important that there’s been some instances in the past where a policyholder isn’t paid out because their old definition doesn’t cover something that the newest definition being sold by the… SOFIA: Right OK, so that’s quite a big difference then actually, isn’t it? PHIL DEACON: Yes absolutely and there’s a couple that have been quite high profile and have made the national press, and so we’ve taken the step of having this cover upgrade because we believe that that is the right thing to do and that we should be able to offer all of our customers the very best cover that we’re offering new customers. But there’s also guaranteed insurability options built into the policies so that if they get married or they buy a home or have children, for example, that they can increase the amount of cover without underwriting. So again that’s really important that they have that there for them and they don’t need to worry about anything that’s happened to them since they originally took the policy out. SOFIA: So what does that look like, so say they have children, so it’s a new policy or it’s not and they just need to notify? PHIL DEACON: Yes, so the existing policies allow policyholders to notify the company and ask for an increase. And there will be a limit to that increase that they can request under the guaranteed insurability option, for example. But it allows them to increase the amount of cover that they have to reflect those changes on that life journey, as I say, whether it be a child, a new house or what have you. SOFIA: And obviously this is slightly different to, it’s not the same as breaking your phone and ringing up and getting a new phone, this is a highly emotional, very difficult situation, is there any support around that? PHIL DEACON: Yes, absolutely, and I’ve got to be honest and say this is the thing that makes me most proud about the job that I do and about our industry and the products that we sell and that people benefit from, and I see this and my team see it at first-hand, and it is emotional, some of the situations that people find themselves in, some of the phone calls that my team has with people are just ever so tough to hear. And the fact that we can help people is fantastic. And help them not just in paying a financial sum to them and alleviating any financial concerns, but actually all of the help around that. A claim is much more than just about a pay out; it’s about helping somebody at the worst of times. Most providers will provide some additional services at the point of claim for customers to help them in their situation, whatever that may be. We’ve taken a slightly different approach at Guardian. We have a claims service called HALO. We call it our claims concierge service, because we listen to what a customer needs, we listen to their circumstances and take the time to understand. And we see how we can help and we recommend services to help them in their specific situation. And there’s a few regular providers that we work with and that other providers work with as well, so personal nurse support, for example, where people can just have an ear, somebody to talk to, a listening ear, for example, to get emotional support or practical advice, signposting maybe to government benefits or NHS services or onward referral to more specialist services. We also work with a legal charity who help people with situations that can arise from serious illness, such as employment issues, I guess issues with debt, that type of thing, and those services are really important. But we’ve tried to make it a little bit more bespoke and so we’ll work with any provider that we think can actually help a customer in those specific circumstances and if need be we’ll help them financially. I remember one case where a dad was taking his young child to hospital two or three times a week, a journey of about 70 miles, he was incurring travelling charges, hospital parking fees and all the time he was having to take time off work, and so whilst we were waiting for the information to pay his claim, we were able to pay him a bit of money to help with his travelling costs. And that was in addition to the benefit that we then eventually paid once we got the information we needed. So I think yes there’s lots of help, lots of support, and it’s really gratifying for me to see how we can help people and to see, you know, I think people are very grateful for that, and most people don’t realise the amount of support that is available and they’re quite surprised. And I think that’s one thing probably as an industry we need to be better at telling people about is that look yes we can alleviate your financial concerns, we can give you financial peace of mind by paying the benefit, and that’s not to be underestimated, but there’s so much more support available to people at the worst of times and people really are grateful for it. HILARY BANKS: And I think stories really help and I think we’re getting much better as an industry at telling stories. Certainly these claim stories that Phil and the team have got and others in the industry when people are making a claim, and you can’t comprehend the impact on somebody’s life when something happens and the impact on their families and their children, or it might be that a child is actually, the claim is for the child and then the impact on the parents having to take time off work and I think we’re getting much better at making sure that we’re sharing. OK, you can’t share the details of these claimants, but you can give advisers an idea about the context of these claims and I think that’s powerful. Because actually sometimes you’re asking somebody to buy a policy for something they hope they won’t ever claim on and spend money every single month on something that has no tangible benefit. So anything that you can do as an adviser to give those clients real-life stories and experiences of those policies really help to bring those to life and make a client realise the importance of them and makes us incredibly proud. And I’ve talked about it a lot today, but we should be proud of what we do for our customers. Advisers should be very proud, as we are very proud as well. SOFIA: And with this, it’s within the interests of the insurer and the customer to be healthy and try and avoid this happening, are there any health benefits as part of this cover? HILARY BANKS: Yes, there is. And I think there’s loads of really great value-added benefits now available, and I think there’s an expectation from customers to have a value-added benefit. Again we talk about the fact you’re buying an insurance policy that doesn’t have any tangible benefit, it’s important that a customer can take something from that policy. It’s in our advantage to make sure that we’re keeping our customer well. One of the things that we have at Guardian is we offer all our policyholders access to a free online GP or virtual GP services. So seven days a week, 24 hours a day, policyholders can speak to a GP, they can get open referrals, prescriptions and I think with everything that’s happened in the pandemic particularly and the pressure on the NHS, any customer, anyone that’s tried to get a GP appointment in the last 18 months understands the pressures. SOFIA: Yes, it’s several layers to it now. HILARY BANKS: Yes, I tried to get one for my child and I think I had to wait three and a half weeks for an appointment with my local GP. And so the fact that actually Guardian is offering that to policyholders, again it’s hopefully making sure that if people are sick that they’re getting early diagnosis, which is ultimately what we’re all trying to make sure that we’re doing. So there’s one. We also offer a second medical opinion. So actually should the worst happen and a client be in a situation where they’ve been diagnosed with a life-threatening illness, we give them the opportunity to actually have a face-to-face consultation for a second medical opinion, which is important at that time. And it might be that it gives you the confidence in actually the pathway that the NHS have set you on, or it might be actually that there’s something else that they would recommend that you could consider. So there’s lots of different things available, and that’s just two of many things, but it just gives you an idea as to the type of things that are available to customers. SOFIA: Unfortunately, that is all we’ve got time for. Thank you Hilary and Phil for joining me today. HILARY BANKS: Thank you. PHIL DEACON: Thank you. SOFIA: And if you did want to find out anymore on this subject, there is a link underneath the player.