Any businesses not meeting the needs of smarter-working practices risk being dumped by advisers
Although the rate of adaption to change by businesses has been positive, simply changing the processes necessary to keep new business flows in place is not enough. E-signatures, cybersecurity and the letter of authority process are all in need of further upheaval.
The overwhelming 88 per cent support for electronic signatures identified in the recent Money Marketing readers’ poll demonstrates the full extent of support from advisers for more change in this area.
Photographs abound of mountains of mail that need to be scanned by advisers. Equally many firms still have to have someone make a daily pilgrimage to their offices to open and scan mail. This really should be unnecessary.
All communications from providers to advisers originate in electronic form (I am assuming there are no dark corners on any institution where typewriters still survive) and are then printed.
Why can’t we take this paper out of the process and make delivery digital too?
Up to now, firms may have been locked in to long-term contracts with external mailing houses. However, I hear many such organisations breached their service level agreements during the lockdown, presenting an opportunity for renegotiation.
With institutions also concerned about their carbon footprint and cost, the long-term benefits are obvious, so let’s do something about it.
Also, insurers and platforms are not doing enough to support advisers trying to operate good cybersecurity practices. I recently came across yet another case where an adviser, having sent confidential client data to an insurer by encrypted email, was asked to resubmit it unencrypted, because the insurer wouldn’t accept encrypted email.
I will not name the life company, as it could easily have been virtually any other life office or platform. The failure of platforms and insurance companies to accept encrypted email is causing real consumer detriment at the very least, and more likely serious risks of cybercrime, on a daily basis. This can’t be allowed to continue.
Clearly there is a vast array of different email encryption systems that could be used, but only one in our industry where 38,000 advisers and their support colleagues already have an account with them. I refer, of course, to Unipass Mailock.
The system, launched in January, enables advisers to use encrypted email with providers free of charge; or rather it would if there were any life companies or platforms accepting this mail traffic. For £8.50 plus VAT per user per month advisers can use this with all their clients.
A suitable industry system that will deliver real benefits to advisers and clients is ready and waiting, but no providers are moving forward with it. This needs to change and change now. Platforms and life offices failing to move quickly to embrace such tools should think seriously about their corporate and personal liability, responsibility under the senior managers and certification regime.
Letter of authority
Another area that is long overdue for improvement is the letter of authority process. For 18 months a diverse group of 30 firms, including advisers, networks, support groups, employee benefit consultants, practice management systems, cashflow plan suppliers, platforms, life insurers and more, have been working with operating efficiency fintech company Origo to deliver a new Unipass Letter of Authority (ULoA) system.
I recently saw the system, which is just going into user acceptance testing with the intention of going live later in the year. There are lots of very useful features in what has been built, but the current iteration involves an electronic process where advisers will still need to print the letter of authority and obtain a wet signature. This is not acceptable.
The restriction is not because Origo cannot implement electronic signatures, but because many insurers and platforms are still dragging their heels on accepting electronic signatures for letters of authority. The guilty parties should be ashamed. Frankly, Origo should stop shielding providers and enabling them to get away with such antiquated practices.
More and more advisers are talking about ruthlessly dumping business partners who cannot meet their needs to work smarter after Covid-19. Any organisation that can’t accept electronic signatures for all business processes by the end of June should prepare for a catastrophic collapse in their new business in the second half of the year.
Ian McKenna is director at the Financial Technology Research Centre