Having run nine marathons she is as determined to push her physical prowess as she is the boundaries of group IP. Paul Robertson talks to Diane Buckley about her experience in the intermediary market
While cod psychology is generally best avoided, in terms of an interview it is often inevitable as the interviewer is expected to give some sort of impression of what the person interviewed is like. This is not always easy, as in the main you will not know them and a half hour formal interview is not the best place to make their acquaintance.
Sometimes, however, you are just handed the defining anecdote on a plate. Diane Buckley can be summed up thus: a keen runner she was on the 18th mile of the New York marathon when a lady fell in front of her. She stopped and bent to check the woman was OK, and on standing up again, fainted. This is in itself not so odd, on a run of that length the blood does tend to concentrate on the legs. However, after a while to recover she continued and completed the race. Why? "Well I wasn't going to walk around the Bronx in a vest and shorts, was I? It was safer to continue the race."
The enforced stop led her to feel she had not done a 'proper' marathon (it was her ninth), so two weeks later she ran another in Cornwall.
So we will settle on tenacious, shall we?
Her career in Legal & General (L&G) follows a similar vein: few people can claim 22 years at the same firm with a steady promotion path. Buckley, however, sees it differently. She says: "I have had many different roles in L&G but the common theme is that they have been through intermediaries. I have never been on the direct side. This is why I still believe in the value of this distribution channel. It's about what the advisers can bring to the market. We should work with their values and not impose our own."
Long experience in these markets makes Buckley as good a person as any to forecast the year ahead: "I think the general market will be tough this year. We will see employers with fewer staff. Yet there is a chunk of mid-size employers out there that are keen to look at their overall benefit package and assess what they offer staff.
"It is likely that we will see much more in the way of partnership opportunities. We will see many more core propositions that employers will offer, and then there will be an additional offer to the employees for either greater or longer cover. There will be much more working together on this. Employers are finding it hard with the cost constraints to offer benefits but could provide enough and leave the individual decide on whether to top it up themselves. We are already seeing individuals focusing much more on these issues and the employer getting the ball rolling will be a spur to them topping up the benefits."
However L&G's group protection sales are up over the recent months. It is obvious that L&G has been proactive in harvesting market share. "We have made big inroads into income protection (IP) this year. It's an area we were certainly able to add more value that we had not maximised. This year in particular we launched both Onederwriting and centres of excellence in the claims area. It is there that we have been working with employers. We are, and remain, a key life player but on the IP side we were weaker and it is there that we have been building up."
L&G has been reimbursing 10% of the premiums from the first year of group IP to advisers, but this scheme ended on 31 December. Will it be renewed? Buckley explains that the scheme was in recognition of L&G acknowledging the initial importance of setting up the processes in order to explain the importance of this product to employers. Yet it met with limited success. Buckley had a number of calls from advisers who said that, as they operated on a fee basis, they would be more comfortable with the rebate going to the employer.
"We are committed to trying to grow the overall size of the IP market. We feel the numbers - at 12% of the employed population covered - are low. Yet we have not seen the demand we had hoped for coming through from these schemes so we are assessing other means and mechanisms such as increasing our profile in the general employer population as a way of driving forward sales. There is nothing better than an employer talking to others about their experience instead of an insurance company."
For one time only
Autumn saw L&G announce Onederwriting on group IP sales, meaning those covered within a scheme would be underwritten only once, regardless of salary changes. Many have wondered if this initiative will be rolled out across other products. Buckley replies: "The two component parts of Onederwriting, the tele-medi-underwriting and the nurse screening, are already rolled out to the life side. We are hoping to reduce the underwriting time in this area because it can still take between 40 and 50 days. With Onederwriting in IP, we got this down to five working days so we are expecting huge step forwards on the life side."
She adds: "This service is already available but we have not got advisers understanding that yet. We have put out a few bulletins but we have not really gone out there with a strong message on this. We will be doing this though, starting in January.
"We will be fighting to maintain a market lead on the life side. It is where we have our traditional strength and even now we are thinking of increasing our free cover limits in line with market demands."
However, it is obvious that the IP arena has again been targeted for 2009. Buckley clearly believes there is still a lot to do in IP, as an area L&G can still add a lot of value to. The main focus this year was on Welfare Reform and subjective illnesses, and she sees this year tipping more towards the muscular skeletal and the blue collar sector.
"This is an area in which we have not traditionally been strong in as an industry and there is so much more we can do," she says. "When you look at the NHS figures of six to nine months to access physiotherapy it could mean that blue collar workers would not work during that time, whereas we can offer immediate access and nip things in the bud. We have to get employers more switched on to this.
"Many employers have not calculated the cost of absence. Given the present climate, they may have fewer employees but the value of their presence would be increased. There will also be a huge amount seen next year on the added value side of the product such as rehabilitation and employee assistance. We are really only starting to scratch the surface in what we can achieve in these areas."
Buckley notes that the average notification is down to 10.8 weeks. "Compare that with a few years ago when we were averaging about 23 weeks. When we have employers engaged and advising us after 10 weeks, we have so much more opportunity to get these people back to work and to make these schemes that bit more effective."
There is a "huge" amount of innovation left within IP. "Certainly next year we will see how previously people might have had ill health early retirement options on their final salary pension. Yet now with more direct contribution pensions, employers will not have a pension pot to rely on. Potentially, although it only covers up to retirement, IP can cover a great deal of that gap. It is not about the product but what the market demands are and how people understand the gaps that they have and how they could be filled by the products we offer," says Buckley.
Overall, she is an optimist. While realising that the short term is likely to bring the markets into slightly more parsimonious times she nevertheless sees the future of group protection, and IP in particular, as essentially rosy. However, it is obvious she is somewhat frustrated by the insurance industry's overall reputation with the general public, and she sees this as essentially unfair.
She says: "What I think is important, and what really frustrates me, is that we have not got the confidence yet of the general public. I think what we offer is actually both a good and benevolent service that can ensure people don't end up on the slippery slope that leads to living on benefits. The market is so much more than a premium and a claim, and we do not have that widely understood. There are so many added benefits to the products nowadays. I really cannot see why we don't get that message understood more widely.
"I know it is not the nature of news, but we need positives to balance the negatives. There must be a way to tap into these positives that make such a difference to people." She is a fan of LifeSearch's efforts at getting a generic protection campaign off the ground. "The industry needs to make positive points, even though they are not always considered news. If there is a time and a way to buck that then maybe now is that time."
She may be right.
CV: Diane Buckley
2006 - to date: Managing director, group protection, L&G
2002 - 2006: Head of the corporate business division, L&G
2000 - 2002: E development and change director, IFA operations, L&G
1998 - 2000: Operations director, IFA distribution, L&G
1986 - 1997: Fleet and property underwriter, L&G.
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