Recent data from MorganAsh indicates that concerns over bias in customer vulnerability assessments are largely unfounded.
The company’s analysis reveals minimal differences between vulnerabilities identified by agents or advisers and those reported directly by customers.
MorganAsh specialises in Consumer Duty and customer vulnerability solutions. Its MARS platform assists firms in identifying and monitoring vulnerable customers, ensuring compliance with regulatory standards and promoting better customer outcomes.
The MorganAsh Resilience System (MARS) evaluates 100 characteristics of vulnerability. Findings show a mean variation of just 1% more vulnerabilities identified by advisers compared to self-assessments by customers. For the most severe characteristics, this variation drops to 0.1%. Over 90% of the characteristics exhibited less than a 2% difference between the two assessment methods.
Andrew Gething (pictured), managing director of MorganAsh, suggests that fears of assessment bias may hinder progress in meeting Consumer Duty requirements and supporting customers effectively.
He said: “Despite the clear remit from the FCA and Consumer Duty, firms often delay assessing customer vulnerability because they are concerned about bias in the method used. While our data is not definitive for every type of business, all of our evidence suggests that any concern of bias is far less of an issue than feared.
“Benchmarking data between methods, distribution channels, offices and against the FCA’s own data is the best way to analyse the effectiveness of different methods. In all methods though, there absolutely needs to be a clear classification system to provide consistency in the data and enable meaningful analysis. MARS uses an objective severity range for each characteristic to generate an overall Resilience Rating for each customer.
“This will update with every assessment – and as characteristics change throughout the customer journey. It can be reported against and is shareable throughout the distribution chain, helping to meet the requirements of Consumer Duty and the demands of a regulator that actively wants to see better quality data and greater supervision of outcomes for vulnerable customers.”
