advo’s Colin Boxall was interviewed for Cover Magazine where he discussed how the intermediary market, as well as advo, have changed over the past two decades.
In an article published first published in Cover Colin outlines his thoughts over how the intermediary market has evolved over the years.
“Is 20 years is a long time? Remember Aqua’s ‘Barbie Girl’?, It spent 12 weeks in the top 10 in 1997, the year that J. K Rowling published the first Harry Potter book.
The familiar can sometimes make the past seem closer but today’s Intermediary operates in a world with few similarities to how things were done 20 years ago.
Back in 1997 mobile phones were in their infancy, there was no communication ‘on the go’ and no expectation from clients of an immediate reply. A moving image in a picture was still a thing of magic. Retained knowledge was still admired with no Google to ask.
Things change, but some still some stay the same. Reruns of ‘Yes Minister’ compare the shortcomings of the NHS to the Minister’s own private healthcare where those who can afford it have access to better care.
1997 was also the year that the advogroup was established by the current CEO, Larry Bulmer. Today advo remains one of the few privately owned Intermediary firms, and arguably the largest.
I have been an intermediary for over 25 years, starting back in the days when carbon paper was still used.
My career started in life and pensions, I then moved to Prime Health for a short while, then an independent Healthcare intermediary, setting up my own firm in 2000 which merged with advo in 2008.
Thinking back 20 years one figure sticks in my mind, £22.78. It was the 18-29 monthly price for a revolutionary medical insurance product from new insurer, Prime Health.
Their Primecare policy simplified cover and undercut the market. To me this represents the opportunity that existed at the time. This insurer subsequently became Standard Life, then PruHealth and now Vitality.
Other UK PMI insurers at the time included Royal Sun Alliance, Clinicare, Abbey National, Cornhill, BCWA, AIG & Iron Trades, Norwich Union and Private Patients Plan, all of which have gone through their own transformations.
For the intermediary it was also the time of no compulsory compliance and little competition.
The term ‘Employee Benefit Consultant’ did not exist and the general IFA community had little understanding of medical insurance and even less inclination to find out more. PMI Intermediaries at the time set up referral agreements removing the need for prospecting receiving pre-closed client referrals.
If you were good at your job you could ‘out-broke’ competitors and if your firm incorporated high service standards with clear advice and reporting you moved ahead of competitors.
It was common back then for employers to have both a healthcare and pension broker. IFAs that took on managing PMI for their clients in addition to Pensions were often easy pickings when faced with the knowledge of a PMI specialist.
Those firms that used telesales found it easier to make appointments with confidence that at least one-in-five appointments would result in a new client.
But it was also the time of the ‘Cowboy’. Although mal-practice still exists, it is no longer commonplace.
With the burden of compliance we can sometime forget how it has cleaned up our industry from the miss-reputations and downright lies encountered at the time with some competitors.
Taking on new clients was much easier 20 years ago but the market, people and businesses have evolved. Expectations are radically different as are business approaches and processes.
The Intermediary firms of 20 years ago, without change, could not survive and thrive in today’s market.
Today’s Group Secretaries are more sophisticated, understand wellness and wellbeing and with a focus on their employees’ health demand much higher standards of support and knowledge from their advisors. Single product brokers are rare with an expectation to manage all of a client’s employee benefits.
Since RDR most IFAs have stopped referring their clients as health insurance is one of the few policies they can sell that can include commission. Many of these firms have evolved into EBCs and now become competitors taking back past referred clients.
Standards across the industry have increased considerably. High levels of service, once unusual are commonplace. Firms are fully complied delivering skilled reporting.
The ability to ‘out-broke’ a competitor has disappeared with insurers applying a level playing field mentality. Telesales appointments based solely on price would struggle to close 1 in 20 appointments. We also have comparison sites for individuals, email campaigns reaching out to existing clients and more compliance requirements encouraging our existing clients to look elsewhere for better deals on renewal.
But which would I prefer, today’s market or those of 20 years ago?
It would be much harder for an entrepreneur to set up a business today but with a strong proposition, based firmly on the principals of service, excellence, knowledge and with a strong added value proposition supported by today’s technology you can create a strong, sustainable client base creating long-term partnerships with clients.
To me today’s approach feels right and I would never want to return to the good old, bad old days.”
Colin Boxall is commercial director at advo
You can see the original article in Cover Magazine here.