Industry meeting proposes radical changes to reduce paper forms to save customers, advisors and insurance companies time and money
TORONTO, Jan. 26 /CNW/ - Have you bought life insurance recently? Did you find that the advice from your agent was solid, but the process and paper forms they used were long and cumbersome in an era when you can do most transactions electronically? If so, you are not alone. When you factor in the eco-costs of all that paper the picture is even more outdated!
A full kick off day meeting was held today at the Toronto Hilton by 130 industry delegates from all corners of the industry. Attending were 33 executives from insurance companies, 53 distributors and 44 industry suppliers. Attendees discussed the benefits of finally getting rid of paper and moving towards comprehensive electronic processes.
The key is "straight through processing". Today most information on the paper application is manually entered into many different computer systems. With straight through processing, when the advisor completes the application with the client electronically, answers are checked for completeness and clarified on the spot. Key data from the application is then secure and available immediately for all parties that are a necessary part of the confidential process, including the advisor, the advisor's distribution company, the insurance company, and industry partners for arranging medical tests directly with the client.
Byren Innes, Senior Vice President & Director with NewLink Group Inc. a consultancy firm to the life insurance industry gave the results of a survey of insurance advisors. "Advisors see this change as resulting in a more satisfied customer. For the advisor, they see a significant decrease in administrative workload resulting in increased resources available for client communication, and servicing as well as greater professionalism."
Scott Sinclair, Chief Operating Officer of Transamerica Life explained how it translates to greater professionalism. "All this paper forms part of the legal agreement of an insurance policy. With long forms it is easy to miss a checkbox or not provide enough of an explanation about a visit to a doctor. The advisor then needs to go back to the client for updates to the information and can feel awfully foolish for what seems in the client's eyes as something trivial. Not to mention, all that paper, and the courier and transportation involved, do not create a very green solution."
The Canadian insurance industry is admittedly late for this type of technology. There is now a consensus that the life insurance industry can do something similar to what the Canadian investment fund industry did. Consider this, says Tim Fitzpatrick, President, VirtGroup, "All this paper has to be sent by mail and courier and shuffled on employee desks. In the late 1980s it took 28 days for a customer to open a new mutual fund account as it was all then driven by paper. Today it takes at most 3 business days to settle as the purchase is recorded and checked electronically by all parties using standards and a shared network. It is 2010 and yet on average it takes 36 days to process and issue an average insurance policy. Aside from the time required for medical testing, for some insurance applications, this timeline could be cut to as little as 24 hours."
Byren Innes concluded, "Advisors are uniform in saying that this is the single most-important change that can happen and should have been implemented years ago!"
For more information:
Coordinating this initiative is CLIEDIS, a not-for-profit organization dedicated to common standards and conventions that enhance the efficiency of the Canadian life insurance industry to the benefit of carriers, distributors, associations and business partners. The organization supports this mission through training, development and industry advocacy activities.
A conference call for the media will be held Wednesday, January 27 at 11:00 am Eastern time. Please contact CLIEDIS Executive Director, Julie Parrott at email@example.com or (416) 830-3161 to register for the call.
SOURCE CLIEDIS: CANADIAN LIFE INSURANCE STANDARDS ASSOCIATION
For further information: For further information: CLIEDIS Executive Director, Julie Parrott at firstname.lastname@example.org or (416) 830-3161