Of those that did begin the process of applying for additional units, IFS Insurance Broking studied five of its large industry fund clients and estimated dropout rates of between 11 and 25 per cent, depending upon the “occupation demographics” of each scheme, with blue-collar type funds revealing a higher dropout than the white-collar.
The head of operations at Media Super, Michael Rooney (a semi-blue collar fund these days mixing printers with Fourth Estate types) has no illusions as to why so many manual workers are frustrated in their attempts to boost cover. “When the insurer only needs a completed questionnaire from the member, we’ve got relationship guys on hand who can help members over the phone with that, we can get it back to the insurer quickly and thoroughly and it gets good results,” he says.
“However, when a doctor’s involved, that’s where we see the frustration from members because we’re not getting reports back in a timely manner. The doctor keeps telling us ‘we’ve done it’ or ‘we’re going to do it’ but it just doesn’t come through.
And that’s where we lose them. No-one ever seems to talk about the doctor’s part of the cycle – whether you’re applying for cover electronically or by phone, the need for doctors’ reports is always going to be there and that’s where we tend to lose members.”
Of course, the group insurance industry is doing its best to reduce the need for doctors’ reports in the applications process. Many use third party providers, such as Lifescreen, to visit applicants in their workplaces and administer blood tests, body mass index measurements and the like. Some like IUS have their own operatives make the on-site visit.
The aforementioned Auscoal, whose membership base comprises mostly coal miners, could be assumed to have medical reports flying around all over the place. Colin McGuinness admits it wasn’t so long ago that Auscoal was “in the Ark” with just $50,000 of default cover for 15 year olds to 65 year olds (it cost $7 a week to boot) and a maximum of $300,000 coverage without fronting a doctor.
The fund set about working with Comminsure to comfort it around the level of ‘group’ fatality risk in coalmining. At one stage Matthew Plenty, national business development manager at Comminsure even went down a mine to be assured there were not “little dwarves running around, picking away”, and that in fact in McGuinness’ words, “you could fire a gun and not hit anybody, it’s so highly mechanised these days”.
