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Managing expectations is key to happier clients

31 October 2022
4 minute read
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What it says on the box is what it should deliver, especially when the product in the box is a financial service such as an insurance policy or investment. Clients believe promises on boxes. They are happy and satisfied if these promises are fulfilled. However, promises can only be fulfilled if clients have a clear understanding of exactly what is being promised and don’t have unrealistic expectations.

Realistic expectations are neither an undersell nor oversell

Realistic expectations are when clients understand their products and know what service they can expect. They require a client to understand the value of the product, such as an investment that funds a retirement or a life insurance payout that helps a family financially when a breadwinner dies. At the same time, there needs to be an awareness and understanding of the products’ terms and conditions, and what affects when products deliver and how. For example, investment products may not deliver good returns when there is volatility and/or a recession. Insurance claims may be rejected if there is material non-disclosure.

Missed expectations destroy confidence, trust and relationships

Clients’ dissatisfaction with service, turnaround times, updates on queries and claims leads to complaints and cancellations, according to the FSCA Financial Sector Outlook Study 2022.

Managing expectations around response times and product outcomes removes much client dissatisfaction, will build your reputation and go a long way to ensuring client retention. 

Education and communication are key to managing expectations

Education and communication are where expectations are discussed and understood. Without these, the risk is that clients can expect too much and/or too soon. 

An Investopedia article calls education the first line of defence when it comes to managing clients expectations. Take your client through their products’ purpose, benefits, terms and conditions to help them appreciate the value of their products and understand them. Be careful of assuming a client will know, even if they work in the financial services industry. Rather make sure and explain products and services. 

Education needs to be ongoing. Financial products are often bought for the long term and clients, just like all of us, forget the details of conversations that took place a year or years ago.

Without knowing what clients want and expect, you cannot know if you or the product can deliver to those expectations. Listen to your clients and encourage them to share their expectations and understanding of the products. For many clients, financial services are filled with words and terms they don’t completely understand. The result is often a misunderstanding, which can later lead to missed expectations. Two-way communication, listening and explaining, will lessen the chances of this happening.

As with education, communication should be ongoing and regular so clients know of significant events that may affect their products and services.

The do’s and don’ts of managing client expectations

With a focus on education and communication, realistic expectations become far easier to achieve. But there are some do’s and don’ts.

Be honest
About products, turnaround times and what can cause changes or delays. It’s easier and means fewer problems later on. And encourage clients to be honest so you can identify where there is a mismatch between the promise and the expectation.

Be transparent
Disclose everything relevant and don’t ignore important terms and conditions or assume clients will read these and understand them.

Keep records
Know what you and your client discussed and when so you can refer to these when needed, and for compliance purposes. Records allow you to check what areas of concerns clients raise that you need to revisit at annual reviews.

Have SLAs and share these with your clients
Clients need to know what you can do and when. Explain what services you offer, how and when. Also explain any SLAs product providers have in place, such as taking x number of days for a claim or withdrawal, or request for a change to a product. Encourage your clients to let you know if they have any problems with product providers or SLAs are not met so you can help resolve these issues.

Don’t promise what you cannot deliver
Clients like guarantees and certainty. Unless a product outcome is guaranteed, you cannot promise this. Also be careful of promising a service or turnaround time on behalf of another provider, such as promising a claim will be paid on a particular day, without checking first. Miss this promise and the client will be upset.

Introduce your team to your clients
Clients often turn to their adviser when they have a query. Advisers’ time is precious, and there are many admin and other queries that your team can more than adequately handle. Let your clients know you have a team who can help them with queries and when you are not available.

Check in with your clients regularly
Annual reviews are a good time to listen to clients’ concerns, make sure their products still meet their needs and check that expectations are still realistic and in keeping with what the product offers and delivers.

Deal with problems when they happen
Well informed clients and realistic expectations mean fewer client complaints and fewer problems, not none. When there are problems, take the time to deal with them as soon as possible, be available and update your clients on progress and requirements. When a client is aware there is a problem they are more likely to understand delays than when no one is communicating with them.

Time and effort pay off

With proper understanding of products and services, and advice, clients will know what to expect and be more likely to share their positive experience with others.

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