Manulife is a leader in political statements: DALBAR

According to DALBAR, an established communications evaluator in the financial services industry, despite the complexity of the products offered, the insurance industry does a commendable job of creating policyholder statements that are understandable to consumers.

Manulife won the overall performance award and top honors for both universal life and separate fund reports. Competing against nine other companies in the UL category, Manulife scored 83.79, an impressive score compared to the industry average of 70.4. With 12 stocks in the seg fund categories, Manulife scored 74.79, just over 10 points above the industry average of 64.81.

Jody Bullen, director of public relations and business development at DALBAR, notes that overall, most of the companies assessed performed well, although he adds that due to the voluntary nature of the survey, not every company participates in it. “Some companies don’t make any changes to their claims, so they obviously don’t want to make something they know needs more work.” This makes it difficult to assess the performance of the insurance industry as a whole.

“With every weight structure, there are companies that really excel in one area, but Standard Life and Canada Life were just behind Manulife in the overall category rankings,” he says.

Bullen also praised Industrial Alliance and Clarica for their strong performance in the UL category, while Clarica, Sun Life and London Life were praised for providing reader-friendly policy statements for seg funds.

DALBAR noted that in this particular study, the industry demonstrated strength in crafting policy statements that avoided confusing or ambiguous language. For example, participants in segregated funds meticulously reported the value and percentage of the fund’s investments in each asset class.

However, there are areas requiring improvement. “The study would like to see companies provide other sources of timely account information that compares account growth or decline to industry benchmarks,” Bullen says.

He adds that more companies should provide personalized account information tailored to the performance of a customer’s product.

Every two years, DALBAR presents the results of its policy evaluations, both for universal life plans and segregated funds. The research is voluntary, and companies that submit their literature to DALBAR have it assessed by a 10-person team that has the expertise to determine how the statement will be interpreted by the consumer.

Bullen says features that are evaluated are those that strongly impact policyholders’ ability to understand important account information. Evaluators will check that most of the language is expressed in layman’s terms and that, where possible, statements avoid the use of complex disclosure language.

Submitted by Mark Noble, Advisor.ca, mark.noble@advisor.rogers.com

(21/03/07)