Five ways to avoid cancellations during the cost of living crisis

From increasing engagement to fostering long-term, loyal relationships with clients, there are various things financial advisers can do to help prevent cancellations during the cost of living crisis, writes Greg Levine and Adam Saville

With inflation still rising and interest rates increasing, the challenge for protection and health insurance advisers at this time is twofold: encouraging clients to take out enough cover at a time when budgets are constrained, alongside ensuring those that have it keep it in place.

Whether its fully explaining the need for cover alongside everything a plan can offer – not just at the point of claim - alongside regular engagement with clients, there are a number of ways that advisers can avoid cancellations at this time. 

Here are five things you can do to add value to your client conversations and help ensure cover stays in place at a time when client finances are likely to be tight.

1. Justify the need for cover

Clients might be watching what they spend at the moment, but the current economic situation has increased the need to talk to clients about protection and health insurance, not lessened it. With household incomes under increasing pressure and cash savings being eroded by inflation, conversations about what would happen should your client – or their partner – become unable to work due to sickness or injury are only going to resonate more. With financial insecurity in the spotlight, offering the most comprehensive cover you can find for a monthly amount they can afford is more crucial now than ever.

2. Explain benefits in full

If a client doesn’t fully understand what they’ve taken out and how it works, they are far more likely to cancel. And there’s much more to protection and health insurance than just cover these days. This means financial advisers are well placed to ensure clients are protected as well as provide something that they are actually going to want to use from day one. Not only are benefits such as discounted gym memberships, annual health checks and access to things like wearable fitness devices compelling to clients at the point of sale, a more engaged client is going to want to keep their plan if they are interacting with it every day, and less likely to question its cost. For example, clients who reach Platinum status – the highest level of engagement with the Vitality Programme – are two thirds less likely to lapse, our member data shows¹. 

3. Deliver tangible value

It’s not just increased persistency that heightened engagement can improve. We’ve seen first-hand how taking advantage of health and wellbeing tools and lifestyle incentives can benefit clients, given that members who participate in the Vitality Programme are on average 20% more likely to improve their health across seven key lifestyle factors year on year². Not only does this mean that clients tend to be happier and healthier, but they can also save money too at a time when they are most likely to want to. This means advisers can deliver tangible value from day one through savings from a range of rewards and partners. Or better still, offer access to the lowest available price of premium if they take steps to get healthy through the Vitality Programme, giving them even more reason not to cancel.  

4. Form a long-term relationship

With protection and health insurance offerings evolving, financial advice has needed to become less transactional, and this has paved the way for longer and more loyal client relationships. Should a client’s financial situation change, you’ll want them to come back to you or refer their friends and family for similar opportunities. By recommending a proposition that offers multiple touchpoints with clients, advisers can add value – at a time when this is most needed – by helping clients to set up a plan. This might involve reminding them to register on Member Zone, complete an online health review or helping them get set up with a wearable device to ensure they get the most out of it. Conversations might also include why indexation is important (especially now) or highlight any other needs they might have, such as private medical insurance at a time when access to care is limited, or pensions and ISAs.    

5. Make regular contact

Forming long-term relationships might mean conducting regular client reviews, which are an excellent way to bolster client relationships, adjust cover where needed and fill any gaps when it comes to their protection and health insurance, or other financial planning needs. While opening dialogue with clients at this time might prompt them to question why they have the cover in place and whether they still need it, it can offer the perfect opportunity to reinforce the value of their cover at this time and all the additional benefits it can bring them. After all, it’s much better to be involved in this conversation than to find out a plan has been cancelled without you knowing. Once a client has gone off the books, it can be very difficult to get them back on later down the line, especially if their health situation changes and they become less easily insurable as they get older.

Working towards better client outcomes is good for everybody – this includes you and your client. Visit our Supporting business quality page to read more.

Find out more about Vitality’s unique approach to financial protection alongside a host of wellbeing benefits and how you can deliver tangible value to clients from day one.

¹ Vitality data, September 2019
² Seven key lifestyle factors which include physical activity, sleep, healthy eating, alcohol intake, smoking, BMI and mental health, based on Vitality data – Vitality Claims and Benefits report 2020