Statement of Advice
Rapid delivery of SOA solution by the Axe team
An example of how responsive Axe and Axelerator are.
By Martin Stewart : 7th of June 2019
The situation:
The New Zealand life insurance market has been traditionally characterised by high levels of upfront commission paid to advisors and brokers on the sale of new policies. Following a number of consumer complaints in relation to potential conflicts of interest, the New Zealand government set up an inquiry to investigate the sale of replacement insurance policies.
The investigation made several recommendations to insurance companies with the intention of improving the quality and impartiality of the advice that consumers receive.
The regulators also issued a warning to all insurers that regulatory action would be taken if they could not prove that they were complying with the recommendations.
The challenge:
For our client it was clear that while they were already providing good advice when recommending a policy replacement, changes would be required to satisfactorily demonstrate this to regulators. They identified several system requirements:
- With hundreds of branches, each with several staff, the system needed to be highly intuitive in order to accommodate staff who may only infrequently issue replacement insurance, and customers who may be unsure of their existing insurance, especially the policy’s terms and conditions.
- The system needed to keep a record of the advice provided at every step, including sales that took an extended period of time to complete, with multiple customer contact points.
- Web pages would need to include clear, minimal messaging, recognising that customers are likely to skip over text-heavy pages of copy.
The process:
Time was not on their side, according to the bank’s Insurance Systems Team Leader. Unlike other systems changes that would normally be added to a backlog and dealt with over time, the regulatory nature of this change meant the bank needed to be fully compliant and operational within 6 weeks.
“The pressure was really on the timeline and the delivery. It was key that the developers knew the platform and the core code. This would have taken time we didn’t have if we had to get a new team up to speed. Luckily we were able to call on the expertise of the Axe team.”
Because of the tight timetable development needed to start on day 1, with no time to perform a full business analysis exercise. “With a permanent support team already in place, Axe were able to define the key requirements upfront in a rapid 4-day workshop. They continued to define and clarify the requirements over the 6-week agile development period.”
As every new requirement was uncovered it was added to a series of automated test cases which meant the team could maintain a high quality, stable build throughout the development cycle.
“From our perspective this meant changes could be made right up to the production deployment without the risk that errors would filter through to production. In a regulatory-driven environment like this, that gave us real confidence in the outcome.”
The solution:
While the requirements were seemingly simple, the devil was in the detail. “Because there are many small decisions that a customer needs to make, changes needed to be made at almost every step of the process, from needs analysis through to policy issue.”
These included:
- Prompts for staff to explain that they were unable to provide personal advice
- New questions to uncover details of any existing policies and whether it is being replaced or not
- Declarations at each stage for staff to confirm they have asked the required questions or read out any advice statements, and that the customer has acknowledged they have heard and understood
- Repetition of relevant questions or advice should any elements change during the process
- Generation of documents to demonstrate adherence to the recommendations and make clear the changes from the old policy to the new
The benefits:
As the first New Zealand Insurer to implement the recommended changes to their sales process, the company gained a marketing advantage, while enhancing their reputation with the regulators.
A side benefit was that the changes helped staff to understand their role and provide a better service, while customers appreciated the additional insight into the benefits of moving their insurance.
Final thoughts:
“Luckily Axe is very flexible. Because they had the capability to divert people from other projects onto this, we were able to immediately mobilise a team for four days of intensive workshops, and within 6 weeks it was all done.”