Karen Woodley
|Head of Healthcare Distribution
As we begin 2023, people in the UK are facing perhaps the most challenging outlook on their lives and livelihoods for 15 years. The aftermath of last year’s economic turbulence has left many facing financial challenges, while a looming recession means further uncertainty is likely in the year ahead.
And it’s not only financial challenges that people face. The winter months also bring colder weather and the risk of exacerbated health concerns. The country faces flu season just as NHS waiting times reach a record high, with 7.2 million people waiting to start routine treatment as of the end of October, according to the BMA1.
To best serve clients during these difficult times, advisers will need to focus on client ‘centricity’ – namely putting the client at the heart of every process, decision, and conversation, more than ever before.
Going beyond the usual
But what does this mean in practice? Every adviser will have their clients' best interests at heart, but during a time in which people are under such pressure, the unique needs of each client will become ever more pronounced.
Advisers should ensure that they dive deeper into clients’ needs and concerns to provide the best possible recommendations. Advisers must not only ask ‘what is this customer looking for?’ but also, ‘are they dealing with any health conditions or financial concerns?’ and ‘what wider products or additional services would benefit them?’
This is vital for the advice industry as a whole but becomes even more important when we look at products such as health insurance or protection where the need for cover may not be fully understood.
A spotlight on health concerns
National economic uncertainty can prompt worry about individual health and illness. Clients may be forced to consider who can pay the household bills if they were off sick, or whether they will be able to access health services quickly should they or their immediate family become seriously ill.
In more ‘normal’ times, clients are often more willing to trust the existing public health and social system but, as the economic skies darken, they may become more interested in strengthening their safety net.
Here, a greater focus on client-centricity has two benefits. Firstly, by considering wider health and financial needs advisers can offer necessary reassurance to a client on topics that can prompt incredible stress and anxiety. It also allows an adviser to find exactly the right products for clients, even if there is less flexibility in their financial circumstances.
Building an open and trusting relationship may also allow clients to treat the conversation with their adviser as a chance to air fears they feel they cannot discuss with their families.
Some may argue that an adviser’s role is not to provide emotional reassurance but simply independent financial advice. However, clients worried about the future are unlikely to make the best decisions over their finances or health, so there is a clear-cut, logical rationale to providing comfort and guidance to clients through the advice process.
The final advice recommendation needs to fit the client's needs, and the journey needs to be as smooth and sensitive as possible. Customers expect this and will be deterred from using advisers and insurers who don’t recognise this as fundamental.
Regulatory expectation
Another reason advisers will benefit from a greater focus on client-centricity in 2023 and beyond is the implementation of the FCA’s Consumer Duty in July.
With the regulator putting an even greater emphasis on good customer outcomes, having an approach which is already customer-centric will place advisors in the best position to easily meet requirements.
To achieve this, a focus on clarity and relationship-building during the early phases of onboarding for a potential client could be key. The intention should be to bridge any knowledge gaps, getting to know the client well enough to spot vulnerabilities.
Customer centricity for a challenging time
For many clients, this level of client-centricity has now become a prerequisite for the trust they must naturally extend to a financial adviser. However, as the economic landscape continues to present new challenges, advisers must become proactive in not only meeting this expectation but exceeding it.
Likewise, regulators will expect advisers to have a secure and demonstrable knowledge of the issues facing each client’s health and finances.
It's a win-win for advisers and clients and simply an extension of the mindset most advisers already have.
This article was originally published in Money Marketing on 15.03.2023 and can be accessed here.