James Carey, Head of Group Pricing looks at how insurers and trustees can collaborate in relation to the changing regulatory environment and looks at the important issue of trust in the industry.

How can insurers help super funds negotiate the changes in the Protecting Your Super Package (PYSP) regime?

There are some obvious examples, like helping super funds with pricing reviews but there are other ways insurers can help funds to negotiate these changes.

For example, reviewing product designs in the light of detailed analysis of pricing and member impacts.  This may involve resetting benefit designs to make them more relevant and tailored to members. Longer term, it could involve more self-directed insurance designs, drawing on experience from markets like the US.

As an industry, we also need to invest more in understanding current and emerging risks of the population and client base. We could do more to think about how risk is changing in the community and how insurers and funds can improve resilience and maintain relevance.

How is MetLife looking to gain a better understanding of our members?

On the back of the Government’s PYSP announcement, MetLife engaged with behavioural science experts to help develop and test a strategy to engage with members on the changes.

Our research focussed on speaking face-to-face with members with account balances of less than $6,000 and under the age of 30.  We also supported this with an online survey of 400 members across this same target group.

Many key themes came out of the research, most notably that younger members are: over-confident, present biased, have low financial literacy, and avoid complexity. Thus, the most common response to the PYSP changes was one of ‘avoidance’.

Following the research, MetLife provided super fund partners with a behaviourally optimised and tested insurance campaign, with supporting collateral and clear call to actions specifically targeted at their members. Key to the campaign is about clearly communicating the benefits of insurance inside super.

A successful member engagement program is about building trust with members, with hyper-simplified messaging to maximise engagement and instil confidence in their choice.

The reputation of the industry is at a low ebb and this is affecting key stakeholder relationships including members, policy-makers, regulators and consumer groups. How can we change these perceptions these groups have about us?

First, we need to raise awareness of insurance in super.  In 2017 MetLife embarked on a campaign to raise this awareness, and undertook a significant piece of research to truly understand the situation and drive action on the back of specific member insights. The research involved face-to-face in depth interviews with working Australians (18-64 years) and an online survey of more than 1,500 working Australians (18-64 years).

The research unveiled some alarming and interesting statistics about member awareness and engagement with both their superannuation and insurance.  For example:

  • 74% are aware they can get insurance through super, however only 54% claim to have it
  • 2 in 3 don't know how to calculate how much life insurance cover they need
  • 1 in 3 of those who have insurance, don’t know the amount of cover they have
  • 4 in 10 aren’t aware they can modify their insurance
  • 59% have concerns with insurance companies paying out in the event of a claim, although we know that over 90% of claims are paid.

The research provided a platform for MetLife and our super fund partners to develop tailored and targeted; communication, content, and member campaigns with simple, actionable steps that members could take at key points in time to ensure their cover meets their individual needs, while also promoting the benefits of this protection.

Furthermore, at the end of last year, MetLife conducted the fieldwork (with over 1,500 working Australians) for our 2018 insurance inside super study, not only to understand movements in awareness levels on our 2017 study, but to also understand the key attributes and behaviours behind ‘engaged’ members. We look forward to sharing these results in the coming months.

What is MetLife doing to help their customers outside of paying for claims?

At MetLife, we are proud of our ‘Nourish’ program. This pilot program is providing services to people with primary mental health conditions and delivering improved customer function, community integration and a better customer experience. Data from the program shows that 60% of participants in the program reported an increase in physical or mental function across one or multiple dimensions of functioning, such as mobility and self-care, measured against the World Health Organisation’s Disability Assessment (WHODAS) 2.0 scale. Of course, MetLife is not alone in developing programs that really help our customers.

What is the one piece of advice you would give to the industry?

We all need to take this opportunity to apply a critical lens to our culture, our values, and our everyday operations to ensure that we putting the most important people – our customers, at the heart of what we do.