Artificial Intelligence, FCA Reviews, and Consumer Trust: Key Highlights from Protection Guru’s Action-Packed Week

Last week at Protection Guru was another action-packed week, with the standout event being our monthly Consumer Duty Alliance (CDA) bi-monthly forum. The session, hosted by Ian McKenna, focused on the exciting and evolving world of Artificial Intelligence. We were joined by guest speakers Simon Cowley and Paul Miller, who provided expert insights into the current landscape of AI in the industry.

As always, the session was highly engaging, diving deep into the available AI tools, examining the confidence levels of advisers, and exploring what the future holds for AI. The discussions were thought-provoking, offering valuable perspectives on how AI is shaping the present and will continue to impact the future of financial services.

Also last week The Financial Conduct Authority (FCA) has conducted a review of the bereavement claims process in the life insurance industry, highlighting both good practices and areas in need of improvement. Key points from the review include:

1. Claims Settling Speed: The FCA has urged life insurers to speed up the settlement of death claims, which, on average, take between 2 to 4 months to pay out. The regulator wants firms to shorten this time frame and ensure more efficient claims handling.
2. Service Level Agreements (SLAs): The FCA has raised concerns about the inconsistency and length of SLAs within the industry. SLAs are often too long, making it difficult to compare service outcomes across firms. Additionally, the review found that some SLAs were set unrealistically high, with thresholds that were unlikely to be breached and not indicative of high-quality service. The FCA called for more reasonable, ambitious service levels to improve customer outcomes.
3. Recruitment and Retention of Claims Assessors: The FCA stressed the importance of improving the recruitment and retention of claims assessors, who play a crucial role in the timely and accurate processing of bereavement claims.
4. Claims Monitoring: Firms have been told to better monitor claims processing times. The review revealed that service levels for claims were not consistently recorded, and measurement practices differed between in-house and third-party service providers, leading to disparities in the service experience.
5. Customer Service: The FCA emphasised that the service provided to bereavement claimants should be as good as the service provided to sales customers. The regulator is pushing for more consistency and better standards across the board.
6. Support Services for Families: In addition to improving claims processing, the FCA highlighted the need for insurers to offer additional support services to bereaved families, helping them navigate the claims process with greater ease and sensitivity.

The FCA concluded that life insurers need to enhance their claims practices, service standards, and delivery to ensure better outcomes for customers. Firms that fail to make improvements could face further regulatory action.

Turning to our content last week Tuesday, we shared part 1 of 2 from our monthly protection forum discussing Single Life, Joint Life and Menu Plan

Another great article from Amanda Newman Smith discussing How can protection specialists build trust with referral partners? 

An interesting and timely article from Dave Corbett on adviser experiences ‘Claims is the area we will all be judged’: Here’s how to improve the journey

The week was wrapped up with insights into how important revisiting protection needs are from Jamie Page, The Exeter Three reasons revisiting protection conversations should be a priority for us all