Radically different approach to member underwriting unties knotty schemes

Sometimes, group life schemes can get horribly stuck.  It happens when the competitive tendering of schemes with members on very high benefits is stymied by insurers’ member underwriting requirements.

Take for example a City banking firm with 50 employees where 14 of the employees have insured benefits of just under £9m each.  Advisers may find it difficult to switch such a scheme even though the potential annual savings to their client could run into the thousands!

The sticking point comes when benefits are so high that they can exceed the maximum limits at which an insurer will accept a previous insurer’s underwriting decision.  (For example, Ellipse has a maximum transfer limit of £5 million on any one member.)   In these circumstances, the members will need to be re-underwritten. 

This leaves the adviser in a tricky situation where they can’t risk moving the scheme as there is no guarantee that all the benefits will be covered by the new insurer.  The client is effectively locked into their existing insurer and whatever premiums it sees fit to charge.

What’s the solution?

Far from being a hypothetical situation, an adviser came to us with the exact problem described above – and we had a solution!  We offered to underwrite the members BEFORE they decided whether they should stick with their current insurer or switch the scheme to Ellipse.  We set no conditions that required them to switch, even if our premiums were lower than the holding insurers, and charged no fee, so there was no reason for the client not to give it a go!

Using Ellipse’s online member underwriting, and supported by Medical Direct’s nurse-based screening service, the members were all underwritten quickly – which they needed to be to fit into the client’s review window.  

The medical screenings were undertaken at a convenient location for all the members, so some were conducted at home, others at the client’s offices.  

The client, together with their adviser, could then make an informed decision whether to stay with their existing insurer or switch the scheme to Ellipse, knowing that, either way, all the underwriting decisions had been made and there would be no uninsured liabilities.

The members, all occupying very senior positions within their company, were not inconvenienced and the client was very pleased with both the level of service provided and the end result – a substantial reduction in their premiums when they switched to Ellipse.

Our online medical underwriting can deliver an instant decision in the vast majority of cases – the actual percentage of ‘straight through’ cases is currently running at 83% – with no need to collect any additional medical evidence, so most members will just need to complete our online questionnaire to find out the terms we would offer.  If you have clients that are in a similar situation, we would be very happy to discuss opening up their options.  Give our Sales team a call on 020 3003 6262 or send an email to sales@ellipse.co.uk

Interact – group income protection with SMEs in mind

After we failed to impress with our premiums the first time around, we have been back to the drawing board with our group income protection product, Interact, to come up with a more competitive rating basis.  With the help of some advisers who responded to our request last year for volunteers, we have now got an accurate picture of how our new rates sit within the market.  

The key conclusion we have drawn is that our prices are now competitive for schemes with up to 150 members – very competitive for those with up to 100.

This result is very much what we were hoping for.  We see small companies as the main potential for growth in the group risk market and our online services have been designed to help advisers who have or are developing SME clients.  Our online system can quote for policies with as few as two members and no minimum premiums or policy fees apply. 

Interact works out at even better value over the long term if your clients keep us posted quickly (within seven days) of any employees who are absent for more than four weeks.  Where employers do this, or can confirm that no employees have been absent during the year for more than four weeks at a time, we reduce their premium in the following year by ten per cent.         

Quotes for Interact are available, online, for schemes with up to 300 members.  Give it a try and we’re confident you’ll get premiums that either are – or are close to being – the best available in many cases.  Whether your experience bears this out or otherwise, any feedback you can give us will be gratefully received.

John Ritche

Chief Executive Officer

Latest adviser survey shows continuing strong support for the Ellipse model

Every six months or so we survey advisers who are trading with us.  As well as giving us feedback on how we are performing in various aspects of business, the comments we get play a significant part in shaping our future development.  Responses from previous surveys have led directly to changes in our systems and processes.  (For example, offering a Master Trust facility:  now used by nearly half of all our group life clients.)

This time around, we achieved average scores from advisers for…

…the competitiveness of our group life premiums: 8.6 out of 10

…how easy our online quote system is to use: 8.1 out of 10

…the quality of service our people provide: 8.4 out of 10

…‘overall’ rating: 8.1 out of 10

Of those who have used our online data submission generating automated accounts, 74 out of 89 prefer it to old-style group risk accounting processes.

A complete summary of the survey results can be found on our website here, including some of the comments and suggestions advisers gave and our responses to those.  Overall, it’s clear that Ellipse is providing a welcome new approach to writing group risk business for a growing number of advisers.

We offer our sincere thanks to all the advisers who participated.  Those who included their email address in their responses were included in a draw to win an iPad Air; the lucky winner was Bryan Hollingsworth, based near Crediton in Devon.  

Peter Fenner

Communications Manager

10 reasons to use Ellipse for group life and disability cover

1.      Our online quote system offers more options than any other group risk provider: group life quotes for up to 500 members, group critical illness and income protection for up to 300, and a minimum of just two members.  If you’ve not used it before, this 4-minute video explains the main features.

2.      We don’t charge minimum premiums or policy fees.  This makes us particularly attractive to small companies.

3.      Accurate premiums as we don’t use unit rates.  Our group contracts all charge for each member’s cover separately –– so your clients pay the accurate premiums for the cover that their members enjoy.

4.      We use a secure, intelligent online system to collect medical and other personal information about members whose benefits require underwriting.  It typically takes members around 20 minutes for members to complete the assessment (which they can do securely at any computer with internet access) and, in most cases, they get their decision immediately afterwards.  This 3-minute video explains how it works.

5.      We have an automated data updating service that allows clients to upload their data securely, quickly and easily.  Scheme accounts, with details of any changes to direct premium collections are then produced for them to download immediately.  It takes minutes – not weeks or months – to complete the whole process.  This 5-minute video takes you through the whole process.

6.      Master Trust: for registered group life schemes, our Master Trust facility means clients don’t need to set up their own trust and register it with HMRC (and it’s free!)

7.      Top-rated online systems:  clients can register on to our online platform as well, allowing easy and secure access to many features including scheme documents – in the F&TRC e-excellence survey our online systems came out top of all the insurers assessed.

8.      Flex and voluntary schemes available for all sizes of scheme.  Our quotation system brings flex basis group risk cover to small companies.  More information available here  

9.      Event limits in group life: we routinely provide £300 million cover per location in EC and E14 postcodes.

10.  Excellent financial strength ratings: we are part of Munich Re, one of the world’s largest insurance and reinsurance groups.