Scenario: Buying insurance
The following scenario relates to an initial enquiry about insurance and a subsequent purchase.
Engage in the sales process with the client in an honest, fair and transparent manner.
Refer to Section 4 of the Code for additional guidance.
Select Start to begin.Start
"Good morning and welcome to Phoenix Insurance. How may I help?"Continue
"Hi there. Look I've never had to buy insurance before so I'm feeling a little daunted and confused.
I'm really struggling to understand and I'm so confused.
The issue I'm having is that there's a huge range of insurance products and policies online…"
Refer to your obligations under Section 4: Buying Insurance before responding to the customer.Continue
How do you respond?
“What in the world are you talking about?"
Your response has clearly confused the customer and is a breach of section 4.5 of the Code:
We will take reasonable steps to ensure that our communications with you are in plain language.
Perhaps you should keep in mind the customer’s basic understanding of insurance terminology and offer a different response?Try again
“Really? And how did you determine that?”
The customer is wise enough to detect the possible falsity underlying your sweeping generalisations. You have also managed to commit a breach of section 4.4 of the Act:
Our sales process and the services of our Employees and our Authorised Representatives will be conducted in an efficient, honest, fair and transparent manner, in accordance with this section.
Why not agree that you’ve made a slightly exaggerated statement and wish to try again?Try again
“I don’t see how my blood type has anything to do with it...”
Your response has clearly frustrated the customer and is a breach of section 4.6 of the Code:
We will only ask for and rely on information and documents relevant to our decision in assessing an application for insurance.
You probably should apologise and respond in another way.Try again
“Sure thing and thanks!”
That’s a great response that shows you are committed to providing a high level of customer service.Continue
You continue to assist the customer with their insurance needs and find that based on their situation, you are unable to provide the insurance product.
Refer to your obligations under Section 4: Buying Insurance.Continue
What do you say next?
“Oh, that's too bad… but yeah, go ahead...”
Although, the customer is upset about your decision to reject their business, you’ve ensured you maintained a high level of customer service by providing them with reasons for your decision as per section 4.8 (a):
If we cannot provide you with insurance, we will:
(a) give you our reasons;
Are there any other responses you could provide at the same high level of customer service?ContinueTry again
“You win some, you lose some, I guess… If you could, that would be great.”
Sure, the customer is still upset about your decision, but you’ve exceeded their customer service expectations by providing them with alternatives as per section 4.8 (c):
If we cannot provide you with insurance, we will:
(c) refer you to the ICA or the National Insurance Brokers Association of Australia (NIBA) for information about alternative insurance options, or another insurer;
Are there any other responses you could provide at the same high level of customer service?Continue
“The privacy principles? Are you serious?!!! Get me your manager, please. I’ve had enough of this nonsense”.
Take a moment to regroup and offer another alternative to calm them down.Try again
“I thought I was speaking with a real human being here. What is this?”
Your lack of empathy in response has led to the customer feeling overwhelmingly disappointed. They expected a little more sincerity and other possible options.
Take a breath and then take another shot.Try again
2 days later…
“Thanks for this. Could we talk about what I can do to be able to lower my risk profile?”
You’ve done a great job by supplying the required information while keeping in mind Section 14 of the Code (especially the Australian Privacy Principles).ContinueTry again
The customer contacts the FOS to find that you have led them down the wrong track. The FOS gets involved once the customer goes through your organisation’s internal complaints process. It is way too early for them to get involved and the customer demands to speak with your manager.Try again
“Oh, I’m calm. Why don’t you get your manager on the line so we can chat calmly about the issue. These calls are recorded right?”
You nervously approach your manager, wondering if you've handled the call in the best way…Try again
There might be information you may need to consider in line with the Australian Privacy Principles.
To avoid a breach of the Privacy Act, what might be another, less risky option?Try again
About one week later, your team leader receives an email from the same customer stating they feel the decision to reject their business is unjustified.
Send the most appropriate email response.
Months later, you are facing the Internal Dispute Resolution (IDR) committee explaining your abrupt email.
The case officer asks you to refer to section 4.8 of the Code.
What would you do differently if you could go back?Try again
Select Start to begin.Start
“Hi there, I’m calling to cancel my policy because I’m going to be moving overseas in a couple of weeks. Do you know when I’ll be able to get any remaining premium paid out? It’s just that I need to close banks accounts….”
Refer to section 4.9 before responding to the customer.Continue
What do you say next?
15 days later…
“Yeah, listen here. There’s no money in my account and I’ve scheduled my flight for tomorrow. What’s going on?”
Have you over-promised?
Let’s turn back time and give you another shot…Try again
Your supervisor comes over to congratulate you on some recent positive feedback from this customer. They’ve said you made the move overseas a little less stressful by delivering on your promises.
According to the General Insurance Code of Practice, section 4.9, if an insured cancels a policy, you need to send any owed monies within 15 business days. You have supplied the correct information to the customer.
10 days later, the customer calls back in a panic that they have not yet received their money.
“Hi there. Look, my flight is scheduled for six days from now and I was told there’d be money in my account. Could you please check your end to make sure everything’s gone through?”
Perhaps you should refer to the Code of Practice for information on minimum time limits for refunding any monies owed for a cancelled policy?Try again
“What does that have to do with anything? Could you just give me a figure? This is ridiculous…”
Take a moment to take a deep breath and regroup. What might be a better response?Try again
You end the call with another satisfied customer and head off for a quick coffee.
Upon your return, you notice an email notification. Ash, a new claims service provider, has a quick question regarding instalment policies.Continue
Referring to Section 4.10
Send the most appropriate response to Ash’s question.Continue
Think carefully about Ash’s question and revise your response.Try again
Refer back to Section 4.10 before replying to Ash.Try again
Keep in mind that according to Section 4.10 of the Code:
…if the customer does not respond to the notice you send out 14 calendar days before the cancellation, your organisation would need to send a second notice in writing, either:
- prior to cancelling the policy to informing the insured that you are effectively cancelling their instalment policy for non-payment; or
- within 14 days after cancellation, confirming the cancellation of the instalment policy.
If the customer cancels their policy, the Code stipulates that any money the insurer owes the customer must be sent to the customer within business days.
When a customer has an instalment policy and the insurer has not received an instalment payment, the Code stipulates the insurer to send the customer a notice in writing regarding non-payment at least days prior to any cancellation of the policy because of non-payment.
Why do you think the Code requires insurers to commit to this timeframe?
The Code has this provision so that the customer can be confident of timely reimbursement of monies owing to them, especially since insurers have time standards for customers paying their premiums to them.
What would you do if you didn’t receive the instalment payment after sending the notice in writing regarding non-payment?
According to Section 4.10 of the Code:
If after sending the above notice we do not receive the instalment payment, we will send you a second notice in writing, either:
(a) prior to cancellation, informing you that your Instalment Policy is being cancelled for non-payment; or
(b) within 14 days after cancellation by us, confirming our cancellation of your Instalment Policy
Why do you think there is a difference in the timeframe when customer has a broker acting for the insured?
If the refund money is to be paid to the customer's broker, there are two scenarios likely to influence the payment timing:
- The broker may have an agreement with the insurer for monthly accounting for all premiums paid by customers and premium refunds to customers simply paying, or being paid, on the net difference between the two;
- In any event, even if the money was paid to the Broker in a timely manner, it would be unfair to hold the insurer responsible for the Broker's administration practices.
Case study: the difficult customer
Read the following case study before responding to the closing question.
What has Rosa failed to do in her dealings with Vince?
- taken into account irrelevant information when assessing Vince's application for insurance. The opinion of the employee from Mega Insurance is simply that, an opinion — and one that is not based on fact
- failed to give a clear reason for her decision. The explanation 'outside the insurer's underwriting guidelines’ means nothing to customers
- failed to make available to Vince information about her organisation's complaints handling procedures. Whilst Vince did not make a formal complaint, he did tell Rosa he was unhappy about the decision
- failed to direct Vince to either another insurer or the ICA to pursue other avenues for obtaining insurance cover.