New business: disclosure, mandate and record of advice
How Achekam's Insurance pack takes new business from the broker's disclosure and needs analysis to a signed mandate and a signed record of advice.
By Achekam · · 4 min read · For Insurance businesses in South Africa, Nigeria, Kenya
Launching soon. The Industry CRM add-on described in this article is launching soon. This article describes it as it will work at launch.
Years after a policy is sold, a claim is turned down and the client says, "Nobody told me that wasn't covered." At that moment, the only thing that matters is what the broker can show: what was disclosed, what the client said they needed, what was recommended and why, and what the client signed.
That paper trail is built at the very start, when new business comes in. In a busy office it is also the part most likely to be rushed. Achekam's Industry CRM, with the Insurance pack, turns it into a workflow with each step recorded. This article goes through the steps for brokers in South Africa, Nigeria and Kenya.
The new-business workflow at a glance
The Insurance pack's new-business workflow:
- sends the broker's disclosure and the needs-analysis questions to the client;
- has the broker mandate signed electronically;
- has the record of advice signed electronically;
- records the policy number and the renewal date.
Each step produces something you can point to later. Together they are the file that answers "nobody told me".
Disclosure and needs analysis, sent as a request
The first step sends the client your disclosure and the needs-analysis questions. In the Industry CRM, a workflow step can send the customer a request for documents, and the customer's answer moves the task on. You do not have to remember to check whether the client has replied; the workflow knows.
Good needs-analysis questions are specific. Instead of "What cover do you need?", ask what the client owns, what it would cost to replace, who depends on their income, what cover they already have, and what they could afford to pay themselves if something went wrong. The answers are the foundation of the advice that follows, so they need to come from the client in writing.
Two signatures: the mandate and the record of advice
Two documents in the workflow are signed electronically by the client, and each does a different job.
The broker mandate
Next, the client signs the broker mandate. Achekam's e-signing lets you place signature and initials fields on the document, send it to signers in order or all at once, set an expiry and send reminders. The signed PDF and a completion certificate are filed back into Documents, beside the rest of the client's file.
One requirement to know: an envelope with a signer from outside the business must be linked to a client or a CRM lead before it is sent. For new business this is rarely a hurdle, since the client is usually on record by the time a mandate goes out, but it does mean a prospect must be entered as a client or lead before you send them anything to sign.
The record of advice
The record of advice is the document that matters most when a claim is disputed. The pack has it signed electronically, the same way as the mandate.
A strong record of advice sets out:
- what the client told you they needed;
- the options you considered, from which insurers;
- what you recommended, and why;
- the main exclusions and limits you explained;
- anything the client chose against your advice.
That last point deserves special care. If a client turns down cover you recommended, the record of advice is where that decision is written down and signed by them. In South Africa, a client who later complains about the advice can take it to the FAIS Ombud, which resolves complaints against financial advisers and intermediaries licensed under the FAIS Act.
Policy number and renewal date
Once cover is placed, the workflow records the policy number and the renewal date. Both feed everything that follows. The policy number is what you quote to the insurer for the life of the policy and on any claim. The renewal date sets the clock for the renewal process.
Enter them from the insurer's own documents, not from memory or an e-mail summary. If a claim comes in, following a claim until the insurer decides starts from exactly these details.
Starter wording you must review
Every contract or agreement in the Industry CRM's packs is marked as starter wording that the business must review before use. That includes the documents in the new-business workflow.
Review means more than reading. Have the wording checked by whoever handles compliance for your brokerage, against the rules that apply to you in your country and to the kinds of cover you sell. Replace generic phrases with your firm's details, your complaints process and your actual services. Then make your reviewed version the only one your team sends.
For Nigerian and Kenyan brokers there is one more check: the signing completion certificate currently describes signatures under South Africa's Electronic Communications and Transactions Act, whatever the workspace's country. Ask your adviser how electronic signatures on these documents are treated where you operate.
Keeping the file complete
A new-business file is only as good as its weakest step. Before treating a policy as done, check:
- the disclosure went out and the needs analysis came back;
- the mandate is signed and filed with its certificate;
- the record of advice is signed and filed, including any advice declined;
- the policy number and renewal date are recorded from the insurer's documents.
The bookkeeping side of a new client, from commission to anything posted in error, follows the usual rules; correcting a journal posted to the wrong account covers the fixes. And when the business grows enough to need more hands on payroll, payroll in a small brokerage explains who may approve what.
The time to make sure a new-business file is complete is the week the policy starts, while the client is engaged and the details are fresh. Set the workflow up with your reviewed wording, and every new client after that will leave a file you can rely on.
General guidance only, not advice on your own circumstances. Tax and payroll rules change: check the current position with the authority or your adviser.
