November 4, 2020 – The basic skills protection is an additional product for the protection of the workforce, which is taken out by a different customer group than the occupational disability insurance. This is what Klaus-Peter Klapper, Head of Product and Sales Marketing Biometrics at Stuttgart Life Insurance, says. In an interview, he explains his company’s sales strategy. Excerpts from this can be found in the current insurance journal Extrablatt.
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Insurance journal extra sheet: The Stuttgarter Lebensversicherung aG has put together a whole package of tariffs for income protection. Is it now easier for intermediaries if they have to keep an eye on several solutions at “easi” (Insurance Journal 7/8/2020)?
Klaus-Peter Klapper: In principle, the brokers are very familiar with the products for income protection. This is especially true for occupational disability (BU) products, which you have been successfully selling for many years. But basic skills insurance is also gaining more and more acceptance among intermediaries, which means that intermediaries are rapidly increasing their competence in this product segment too.
In the consultation, an agent should ideally always show the customer all possibilities for income security. With two high-performance BU tariffs and the flexible “GrundSchutz +” (June 26th, 2020), the Stuttgarter offers the broker various solutions from a single source – that simplifies advice. Because he has a sensible income security solution for almost every customer, including schoolchildren and children. And the products are ideally matched to one another, many flexibilities and regulations are identical, which reduces complexity.
If the broker has decided in favor of the Stuttgart company as a partner for income security, the advisory process will be easier for him.
- Klaus-Peter Klapper (Image: Stuttgarter)
Insurance journal extra sheet: Occupational disability is an underestimated risk across the market. Have you noticed a higher level of penetration when it comes to securing workers?
Klapper: Yes, we can actually observe that. We find that the basic skills insurance is not taken out instead of a BU insurance, but mainly by customers who cannot or do not want to afford adequate BU insurance. There are no shifts in new business to the disadvantage of the BU insurance at the Stuttgart company, that is, the “GrundSchutz +” does not “cannibalize” the Stuttgart BU tariffs. With “GrundSchutz +” we are actually reaching a new target group. As an individual insurer, of course, we cannot speak for the entire market. But we assume that other insurers have similar experiences with basic skills insurance and that this is reflected in the statistics of the Association of the German Insurance Industry eV (GDV) will show very quickly.
Insurance journal extra sheet: How high are the pensions that are taken out on average?
Klapper: The average pensions in the Stuttgart BU and “GrundSchutz” portfolio are around 1,100 euros per month.
Insurance journal extra sheet: Advice is often given about BU insurance, but the customer is rejected by the insurer or only insured at very high prices. Is there a guarantee for an affordable offer with “easi”?
Klapper: If the customer cannot afford BU insurance, alternatives such as our basic skills insurance come into play. The “GrundSchutz +” with its flexibly selectable packages is designed in such a way that every customer can take out insurance according to their coverage needs and budget. In terms of price, the Stuttgart “easi” products have something for everyone. By the way, also for children from the age of five! Of course, there is no guarantee that every customer will get an affordable “easi” offer. Because there are also customers who cannot take out basic skills insurance due to their state of health. For these customers, however, the Stuttgarter offers other alternative solutions with its accident insurance.
Insurance journal extra sheet: Do you focus on spending or income protection with “easi”?
Klapper: Whether the agent looks at the customer’s spending or income situation is up to him. We propose income protection, but from our point of view nothing speaks against expenditure protection. Because expenses are – hopefully – in a “reasonable” relationship to income. In principle, coverage of up to 70 percent of the gross earned income is possible with the Stuttgarter.
Insurance journal extra sheet: Are risk inquiries possible or useful?
Klapper: Risk inquiries are of course possible at the Stuttgarter – and always useful when tools such as online risk assessment platform Vers.diagnose GmbH reach their limits. In other words, if you have several previous illnesses or complex clinical pictures, you need a “human” underwriter to assess the risk.
Insurance journal extra sheet: And how digitally does such an advance risk inquiry work?
Klapper: A fully digital advance risk assessment is possible via Vers.diagnose GmbH. Via this online tool or directly in the “Stuttgart Consulting Navigator”, in which Vers.diagnose is integrated. Alternatively, especially in complex cases, the preliminary risk inquiries together with the required documents can be uploaded to the Stuttgart extranet. There they are processed by our underwriters. But the “classic” digital route via email is also possible at Stuttgarter.
Insurance journal extra sheet: Your basic skills insurance knows 15 basic skills, only one of which must be impossible for the insured person for at least six months for the pension to be paid. This also includes terms that are difficult to grasp, such as “maintaining balance” and “acting independently”. Aren’t you afraid that this will encourage the insured to cheat? Or vice versa to difficult regulation?
Klapper: All of our performance triggers are formulated in an understandable and transparent manner. When formulating the conditions, we made sure to avoid elusive terms such as “Working at shoulder height” and with the new “GrundSchutz +” for July of this year we have sharpened the wording again.
This can be illustrated well using the example of “keeping balance”: The conditions define that the customer loses this basic ability if, among other things, he can no longer complete the so-called “streak walk”, i.e. cannot walk ten meters straight ahead with his eyes closed, without tipping over. Even when acting independently, it is clearly regulated that the performance trigger takes effect if legal care is ordered. Future performance practice and possibly also later case law will show whether our clear formulations are sufficient. The benefit cases are still missing, but we assume that we do not have any loopholes.
Insurance journal extra sheet: With your new tariffs, there are many options up to the age of 50 to increase the insurance cover without a new health examination. Such flexibilities must make the product expensive – how did you calculate that?
Klapper: In the BU market in particular, price is one of the most important arguments. Therefore, all of our options are designed to be premium neutral.
Insurance journal extra sheet: Does the agent receive the same commission for all “easi” tariffs?
Klapper: The amount of the commission is of course dependent on the contribution amount. This sum is usually lower for basic skills insurance due to the lower premium level. The commission rate is the same for all “easi” products in Stuttgart.
Insurance journal extra sheet: In your concept, do you expect customers to take out a BU insurance? In the case of a pure price comparison, it will always do worse than the new protection variants, which are modern and flexible.
Klapper: BU insurance remains the first choice, especially for academics and people with high incomes. Also because alternatives are often not attractive in terms of price for this target group due to a different calculation. In addition, the Stuttgart BU tariffs offer just as much flexibility as the “young sister” “GrundSchutz +”. The customer can choose between tariffs with or without benefits in the event of incapacity for work, with different dynamic modes to compensate for inflation, for students with or without exemption from contributions in the event of the death of the provider, et cetera. With “easilife”, the customer remains flexible during the course of the contract: with various options for additional insurance, in the event of payment difficulties or when changing jobs. This makes the BU insurance just as modern and flexible as its “younger” sister.
The questions asked
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Parts of the interview can be found in the current special edition “Safeguarding the Workforce – How Mediators Find Customized Solutions”. Among other things, there are comparisons of different ratings, judgments on labor security and many tips on all aspects of advice. More and more alternatives to BU insurance are establishing themselves in terms of labor insurance. The extra sheet 4 | 2020 contains a number of tips for everyday sales as well as interesting insights into this topic. The magazine can be downloaded for four weeks free of charge as a PDF file from the Internet at this link for four weeks after its publication on October 26th. Anyone who has already subscribed to the special edition has automatically received this issue as a print version. InsuranceJournal premium subscribers receive preferential treatment and can access the new edition in PDF format around a week earlier. |
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