Zurich's Richard Sadler looks at how technical innovations are affecting the way in which people buy protection products.
From the explosion of the use of PCs in the 1990s, the internet in the noughties and the smart phone a decade later, the pace of technological change in our daily lives is rapid and shows no sign of abating.
I don't think anyone in the protection industry would claim we are at the forefront of this revolution, yet when you look back, there has been a major shift in the industry and how we have harnessed this technology.
Here, I consider some of the key technological improvements that have affected the way people buy protection products, and whether they have been a force for good.
Have they made advisers' lives easier? And have they made a positive difference to customers?
Online applications
Over the past ten to 15 years the protection policy application process has been overhauled. Paper application forms are now largely a thing of the past.
These were completed by adviser and customer, returned to their insurance company before a wait of anything between a few days or weeks for them find out whether or not the policy had been accepted.
The adviser had to wade through large and often complicated rate books to work out pricing, while underwriters sought medical and other evidence to determine the customer's level of risk before offering the appropriate level of cover.
This has all been replaced by online application processes, backed up with sophisticated electronic underwriting engines that allow decisions to be given in an instant, to the majority of applicants.
There can be little doubt that this has been a huge step forward for the industry. Advisers no longer need to deal with reams of paper and customers can benefit from cover immediately rather than having to wait for a decision from their insurer.
The fight to be cheapest
The technological revolution can also be seen in pricing. Before the days of computers, advisers and customers who wanted to find out who offered the cheapest cover would have had access to limited information.
Aside from the occasional comparison table in some industry publications or personal finance supplements, there was little to go on. Then came the first tentative steps with online industry comparison sites such as The Exchange, which have grown in capability and sophistication over the years.
Alongside the growth in online applications, these portals have become increasingly important and are now fully integrated into many advisers' sales processes. They enable advisers to see at a glance who offers the cheapest cover for their customer while enabling them to apply at the click of a button.
So is this a force for good? For that individual customer, trying to find the best price, the answer is undoubtedly yes. Without the portals they may miss out on the cheapest possible price for the most comprehensive cover.
At an industry level, the widespread use of these portals has led to lower premiums.
Competition is fierce to be at or near the top of the portal rankings, driving down headline prices, and enabling many customers to get protection cheaper than they otherwise would.
But does this shift benefit everyone? With insurers all searching for ways to reduce their headline prices, more customers have to be rated and more may be declined cover altogether.
At the same time, application forms have generally become longer and more complex, as insurers look for greater certainty before offering standard rates.
The portals are starting to respond to this increased level of rating, by introducing pre-application underwriting services that aim to give the customer an idea of price before starting the application process.
This can be helpful in determining who may offer the best final terms, though adds another step to the application process.
And then we have UnderwriteMe, which is looking to advance all of the underwriting questions before application, so the customer knows their final price before deciding which insurer to apply to. It is too soon to see whether this will be successful.
