50 Shades of Confusion…

I am a great fan of RiskSA and an avid reader of all their publications.  Great was my surprise when they included a link to a very confused and one-sided piece of writing in RiskSAWired (11th of Feb 2015) under the following headline:

In this article the assumption is made that a consumer may not be entitled to a copy of their voice recording, which represents the contract, as entered into by the policyholder and with the telesales agent binding the product provider.  Based on this misguided “fact” and using the example of a badly executed sales call with inadequate disclosures, the writer warns consumers to be suspicious of all telesales.  Not once does the writer make any mention of the due process that should have been followed by a responsible company/person performing an intermediary service or binding function, which should clearly have been the case in this example of selling an insurance policy

Fortunately, not all telesales are created equally, nor are journalists and their investigative pieces. Unfortunately, this article highlights the generalisation and misconception around telesales, especially in the financial services sector. There are companies or individuals who will take chances or cut corners to save costs or increase sales, whether it’s telesales or brokers.  For precisely this reason, the Financial Services Industry is regulated to ensure that all policyholders are treated fairly and the FSB is very clear that it will not tolerate any deviance from the expected standards and regulations… there is not even 1 Shade of Confusion on this point!

Even in the most compliant and controlled environment, one would be foolish to expect that there would never be disgruntled or unhappy customers, this is applicable to telesales, brokers or in fact, to any non-financial services environment. The benefit of concluding these sales via the telephone, rather than face-to-face, is that the calls are voice-logged and referenced to the customer and the particular policy sold.   We find that 90% of enquiries or disputes can be easily resolved by making these calls available to the customer which confirms what was presented and disclosed.

At CDA we are passionate about providing innovative solutions to the Financial Services Industry, which includes various Intermediary Services, Outsource Services and Binding functions. As a registered FSP we are bound (although not handcuffed!) by the same regulations and codes of conduct as all other FSPs.  We know that if a sale is not compliant the repercussions could be severe, from dismissal of a telesales agent to fines imposed by the FSB and crippling reputational damage.

Whenever we communicate to any of our clients’ potential or existing policyholders, there are various controls and processes in place to ensure that we firstly, treat the customers fairly and secondly, represent our clients in a way that ensures that we remain compliant within the realm of FAIS and all other applicable regulations.  Some of these controls include verification of sales calls by an independent team; ongoing product training and sales coaching; quality assurance checks performed by our clients, our Compliance Officers and Key Individuals.

Telesales Agents are not the rogues of the industry, who manipulate and bind customers with little else than “cable-ties”.  Regardless of the many “perfect” sales made and valuable service provided every day in our industry, whether concluded by a telesales agent or a broker, any instance of non-compliance will be highlighted, investigated, written about and this is justified and necessary to protect the industry and the customer.  It is important to remember that thankfully, these sales are the exception rather than the rule.

We have geared our business to function effectively and optimally within the stringent regulatory environment in which we have chosen to operate.  We’ve been audited by the FSB; audited by our clients; we hold all the required guarantees and insurance policies; stand on our heads, lift our skirts (no we don’t, just keeping your attention!) and meet the very strenuous service levels as required by our clients and their stringent, unyielding compliance departments.  Even in this apparent constricting environment, we have concluded over 500,000 sales of simple insurance policies to the middle to lower income-bracket consumer, who would traditionally not be serviced by a traditional broker. 

Telesales as a distribution channel is a necessary and viable solution to reaching previously uninsured consumers and providing them with cost-effective and essential cover.