Can you spot a good client outcome when you see one?

Some consumers might struggle with the idea that you pay for insurance for a couple of decades, receive no claim payment, and this is a good client outcome. When I look at the range of conditions covered in my trauma policy, I am pretty keen on that result myself.

But it is, perhaps, easy to think of 'getting nothing' from your insurance. When in practice, the client got something the moment they signed up: relief from the worry about how their family or business would cope in the event of disaster. Then later, gratefully cancelling a policy after having paid premium all those years, knowing that, you won in the best way possible. That's a good outcome in my books, but of course, not everyone agrees.

An adviser shared with me a series of emails between him and an insurer which showed that in this case it was the insurer who found it hard to spot a good client outcome. A couple of large trauma cases were cancelled by some people who were getting on in years and no longer needed the cover. They had the cover in force for about 20 years, and were paying very substantial premiums. It was time to stop. The insurer saw the impact on the adviser's persistency rate and thought the worst, and started to investigate the adviser for what they suspected might have been a case of churning the client. This is a good example of over-reliance on one metric: persistency. It also over-determines the value of retaining cover. I'm a big fan of insurance, but there are occasions when it is right to cancel it, clients can outgrow their cover, by age and financial situation. I felt this case was one where the insurer should probably have celebrated a job well done over the years - for them, for the client, and by the adviser.