Ok, so this sounds like management speak and to be fair, the financial services industry is littered with products that claim to solve a problem for you but when you really need them you find out quickly that the company has found a way to not help you;
Like your credit card not working when you are travelling due to a fraud flag or maybe the add-on home emergency cover you got because your boiler broke in the summer months or even your road side assistance company leaving you with no way to get to work because you are home already.
But for us, providing effortless home assistance isn’t a tagline or a false promise. It’s our mission.
We provide products and services to cover homeowners for problems around the house with primarily their plumbing, electrics, or heating. Technically, we are classed as being in the Insurance sector, but we see ourselves as a service company.
HomeServe had some serious problems back in 2011 but the issue the regulators had was not with the products themselves. The terms and conditions were clear and HomeServe stood behind them even though they didn’t always cover Customers for what they presumed they’d be covered for.
But when you are providing really important and well-used products and services – particularly those needed by Customers when they are at their most vulnerable - is it right to rely on your Ts&Cs to get out of doing something a Customer really needs or thinks they should be covered for? Can you deliver great service using a legal document?
We were doing a bit of research once with a Customer who had a complaint about her plumbing cover. She needed a replacement part that was not included in the policy schedule and she said the most amazing thing: “I couldn’t understand it. I mean, plumbing is plumbing, isn’t it?”
Martin, our CEO, used that as a rallying cry for the business. He challenged us to find out all the reasons we were correctly (according to the terms & conditions) saying no to Customers when they needed our help and asked us how to figure out how to expand the products.
Because our products and services are backed by insurance there would be a cost but wouldn’t it be better to have a richer product that cost a bit more that a thin product that was cheaper but did less? I had lunch about a year and a half ago with a senior person from a very influential consumer organisation – an organisation that had refused to talk to us during our difficult times. He said to me that you only truly realise the value of cover when you try to claim on it. What is the point of paying less for something that doesn’t work? We decided to buck the trend.
Today’s internet allows people to compare products easily but what are you comparing? It is mostly on price and in order to get the price down, companies strip the product bare which you don’t notice until you go to use them and some exhausted call centre person tired of arguing all day tells you that you forgot about Section 2.1.2.c.3.v and as a result won’t be covered to the extent you expected. They were clear about what they gave you but to be honest they were not clear about what you needed. They only cared about getting the sale and whether that sale was transparent. In a non-advised aggregator world you are required to understand exactly what you need and then need to decide from the information given. What about what you are not given?
So, as I said, we bucked the trend in terms of product cover, and we also backed this with transparency.
We put so much into our products that the only way to sell them competitively is to discount the first year (which is what other providers do) but at the same time tell the Customer what it will cost from the second year when they sign up (which is what other providers don’t do!) and again at renewal. We also have no cancellation fees or penalties if you decide later the product isn’t for you. This allows Customers to use the product and realise the value. In a low interest optional general insurance segment that is the only way to go unless you make the product so thin that it will disappoint when it is used. I can tell you it is lonely out there in our market segment being clear about that second year price. We get called out for our price jump while others remain silent on year two even though their price will go up. They look like they don’t discount the first year but the reality is they don’t tell anyone the second year price. Journalists fall for this sleight of hand consistently.
How rich have we made the products? We have one major product where people used it two and half times a year in that first year. In ten years those Customers will see a little red van just over 20 times. We think saying yes and doing a good job when we get there makes a big difference. We think our Customers will be happier.
The numbers back us up.
We are not just improving our service levels but we are bucking a national trend. This has led to three straight years of increased retention levels. Are we the cheapest? No. Are we the best? Time will tell. Until then though, our mission continues…