Knowledge Hub

Direct insurance vs Advised Insurance

Serena West
Serena West
Posted 20.07.2020 in Lifestyle, Risk & Assurance
As we have all spent so much more time at home this year due to Covid-19, some of you may have noticed those long ads from large corporations looking to sell insurance directly.

They truly make it sound so easy and so affordable. Just call up, answer a few questions and boom, you’re covered!  

My team and I reflect on this as we know when we are placing cover for clients, it is often multi-faceted to get that guaranteeing approval – and at times not easy. 

A real Capital Partners experience: 

I recently had an experience with a direct insurance policy, where I was approached by a widow who was having trouble getting her husbands’ life insurance paid out – she had been trying for several months. Her husbands passing was still extremely painful to her and the family, and these conversations only furthered more pain.

Her situation had reached a serious financial point and in addition, she had the pressure of possibly losing her family home. The exact reason for the cover in the first place. 

As a team that spends countless hours every week working on insurance, we know it is complicated. Hence, we knew we had to investigate how this could happen, and work out what we could do to help. 

The entire policy for this man had been conducted over the phone. I contacted the insurer and spoke to an operator at a call centre. Knowing that this conversation was recorded, I asked for this to be sent to me so I could fully understand what the situation was.  

I set about listening to every call that was made from the time he saw the TV ad in 2014right through to each time he called over the years not quite understanding the premiums. I took notes as I listened to each lengthy conversation, noticing thfriendly banter of the direct representative and the client.  The content of these calls however, was like a well-rehearsed sales pitch – smooth and slick 

To give honest and transparent advice, we must operate at a pace which ensures a thorough investigation can take place without cutting corners. Unfortunately, it seems that for this companyrushing to sign him up and taking his money was their main objective.  

Thankfully the company has since deemed the situation a valid claim and paid the family. The positive reprieve and impact for this family was enormous.  

have spoken with the family prior to writing this personal story, and they would like people to know how difficult it can be to manage an insurance claim without advice. Her husband had wanted to protect her and her future, and had paid a lot of money to do so. I am very glad that we were able to help her. 

Closing thoughts: 

Would I take direct insurance?  No, I would not.  

Why?  For me, the entire point of insurance is to manage uncertainty. The direct process does not achieve this to the standard of a personally underwritten retail policy. 

A common question: “Isn’t it a lot less in premium?  Unlikely. In the story above, the premium was significantIn fact, comparisons often show that direct cover is often no less in cost. We like to assess each scenario when we meet people. 

Personal insurance is personal. It is about the things that matter most to you in life – your family. 

If you have any questions about your insurance provider, contact our Senior Insurance Adviser, Serena West.

Serena West
Serena West
Serena West
Serena loves the idea of getting justice and a fair outcome for people. And it’s these talents and values – this desire to protect people when they need compassion most – that make Serena a phenomenal insurance adviser.