Protection – the pathway to wellbeing through ‘value added services’

Sometimes in life, we all need a helping hand. This is particularly true when it comes to financial planning. Financial decisions are made every day, whether it's budgeting for the weekly shop, paying bills, buying a home, or planning for retirement.

"The most recent challenge facing many employees globally is working from home and managing a situation which may be totally or partially new. Ladders survey found that 49% of remote workers noted their biggest struggle with location flexibility was wellness related."

Impact of remote working to wellbeing

Mental health and wellbeing has been talked about a lot more during the past 12 months than ever before, and is finally getting the level of awareness and openness that it needs. Long may the discussion continue.

The most recent challenge facing many employees globally is working from home and managing a situation which may be totally or partially new. Ladders1 survey found that 49% of remote workers noted their biggest struggle with location flexibility was wellness related. More specifically, 19% felt lonely, causing distraction in their work2. TSheets3 found that constant working from home can put people in jeopardy of poor4 health and cognitive decline. The risk of lack of sleep and depression is a risk too. How can our industry support our customers who may be struggling with wellbeing, mental health and generally managing feeling out of control?

Value-added services helping customers

Enter value-added services. Value-added services are services offered to policyholders outside of the insurance contract. They are not based on an insurable risk or event, but are benefits of enrolment. They are typically not linked to a claim on an insurance policy and are often offered to increase the "tangibility" of otherwise intangible policies (covering infrequent events than may never occur while a policyholder is insured). As such, they can be important in adding value to the policy and improving the satisfaction, retention and renewal of these policies.

The value-added services can be categorised into the following four categories4:

Self-service

Includes services where insurers provide tools and techniques for customers to better manage their insured risk, for example by providing education on preventative health measures, safety or other topics, such as financial education, linked to health outcomes. Discount cards to pharmacies, retail outlets, gym memberships or other businesses are often used. Customers can feel more empowered to manage their own risk and consequently reduce the cost of service for insurers.

Advice and assistance

Includes services that provide timely assistance in case of need, as well as information which can help better manage lifestyles. Services are often tailored towards mitigating risks as well as engaging with customers. Various types of assistance including legal assistance or assistance with employment issues or legal helplines, cyber support, and disaster recovery for business insurance. Health screenings, preventative consultations and telemedicine can be used as an example.

Anticipation of customer needs

Some value-added services are designed to fill gaps in the customer's overall journey by anticipating their needs and catering to those needs by providing life staged based offerings.

Collaboration and engagement

Value-added services for collaboration and engagement are primarily focused on fostering deeper relationships between the insured and the insurer.

Paid Out Claims

Pie chart of paid out claims
Female Claims Male Claims
1. Cancer (81%) 1. Cancer (44%)
2. Multiple Sclerosis (7.5%) 2. Heart attack (26%)
3. Heart attack (3%) 3. Stroke (10%)
4. Benign brain tumour (3%) 4. Coronary artery by-pass grafts (5%)
5. Stroke (2%) 5. Multiple sclerosis (4%)
6. Others (3.5%) 6. Others (11%)

Percentages are for total paid claims per gender Source [https://www.criticalillness.org.uk/]

Value-Added or Added Value?

Insurance customers value integrated, omnichannel propositions and tailored offerings designed to meet their core needs.5 A study from Accenture found that specifically health and wellbeing related services are valued. "Value-added products or services are worth more because they have been improved or had something added to them" according to the Cambridge English Dictionary. Life insurance has come a long way since the innovation that made the first policy available in the 18th century from Amicable Society for Perpetual Assurance Office, founded in London in 1706.

For customers, value-added services provide access to services which they would not usually have access to. For example, discounted fitness trackers, access to online video GP appointments and health apps, which provide information on how to manage your mental and physical health.

When comparing the primary benefits of term, mortgage decreasing term, critical illness or income protection policies available from the providers available in the market, it is typically the primary benefits that are focused on first. When researching critical illness cover for a client, ensuring the providers offer cover for the top 10 diseases would be of primary concern.

Innovation over the last couple of years has seen an increase in "added value benefits" becoming a core component of many protection plans. Insurers now offer wider benefits that can help consumers stay healthy both in mind and body, as well as benefits that can improve recovery or lessen the effects of injury or ill health. Such added benefits might not always be part of the primary research, but may well be worth reviewing as part of the overall research. Monetisation, whether in the form of additional revenues or reduced claims, will flow from the right customer value proposition, so it is essential to keep the customer in the centre of the product and value-added service innovation. Many adviser businesses are also offering their own value-added service wrap around products they sell.

For example, if a provider offers support if a child is hospitalised, it would not necessarily form part of the primary research and would clearly depend on the client's circumstances, but these added benefits are available from providers on the Synaptic Webline Portal, with Aviva, Legal & General and Vitality offering hospitalisation benefit for the children of the life assured on critical illness plans. However, a wider number of insurers offer this for the adult within their Income Protection plans.

The same would be true for clients who perhaps primarily see their financial adviser as their pension/investment adviser, but they will have forgotten the added value their adviser brings from a holistic advice perspective, offering insight and solutions to protect their health, mortgages and income.

Table 1. Sample of Value Added Services available from Providers on Synaptic Webline

Provider Value Added Service Product Name
Aviva Global Treatment available at £4 per month Aviva Life Protection Solutions
Legal & General GP24 is available at an extra cost of £3.25 a month. Giving your client access to a GP 24 hours a day, 365 days a year, from anywhere in the world CI (Standard + Child CI Extra)
Royal London Helping Hand included Personal Menu Plan 2 year payment
Vitalitylife Discounts on health partners such as annual health checks and devices Essentials Plan

Protection the path to wellbeing through value-added services

Value-added services are nothing new, over the last 10+ years, the conventional insurance policy has had many iterations moving from a mere product-led proposition to a service-led proposition, providing additional value for the consumer which they may not be able to or would not engage through other means. The last couple of months have shown us the importance of wellbeing and mental health, and services providing support and guidance on maintaining good mental and overall health are invaluable right now. Do your customers know which services they have access to through their mobiles? If the answer is "not sure", now is a great time to remind them.