Prudential Insurance
The objective of this report is to provide the Prudential Insurance Company with an evaluation and review of the quality of correspondence sent to contract owner. As such, we will furnish Prudential with a tool that can be used to gauge the quality of various disbursement letters sent to contract owners.
Written correspondence between the insurance company and the contract owner plays an integral role in the development of a strong relationship between the two. Dalbar, in recognizing the importance of written communication, evaluates various criteria including the following:
Appearance—In evaluating the appearance of correspondence the focus is centered on the physical attributes of the document. This incorporates the quality of stationery and print-type, as well as any typographical errors or flaws such as ink smudge or the use of white out.
Style-----The style of correspondence evaluates the degree to which the letter is viewed as being a professional business letter. This criterion notes whether the response is personalized to the contract owner’s original inquiry, addresses the contract owner in a personal manner and bears a signature in the closing. It also requires that the correspondent employ a concise writing style which impresses the contract holder as being the work of someone with a strong command of written English.
Tone—The tone of a letter is evaluated for the general attitude conveyed throughout the written document. Each letter is reviewed for phrases that address the contract owner in a pleasant and helpful manner, and conversely, for any phrases that are condescending or abrupt.
Clarity—The clarity of a letter is assessed on the ease of interpretation and understanding of the written materials. Each letter is reviewed for its simplicity and ability to be understood by the contract owner. The use of industry jargon is also noted.
With these criteria in mind, this report will focus on the trends seen throughout the correspondence. Specific areas in which correspondence falls short of excellence will also be mentioned and suggestions will be offered to improve those areas.
In the series of letters reviewed, the Prudential Insurance Company has succeeded, to a great extent, in sounding sincere, well-informed and concerned about the satisfaction of its contract holders. The letters, however, do contain various phrases that do not meet the high standards which largely characterize Prudential’s correspondence. This critique attempts to identify, analyze and revise the aspects of the correspondence series which do not confirm to the style, tone and clarity standards needed for excellence. With these thoughts in mind, here are the trends we found in the form letters provided.
- Prudential deserves credit for the appearance of all correspondence reviewed. Our review of these letters uncovered neither typographical errors nor any deficiencies in the quality of appearance of the stationery used. No ink smudges or indications that white out was used were observed.
- The contract owner is able to determine the degree of professionalism of correspondence when reading the salutation and closing. Every letter reviewed addresses the contract owner as “Dear…” and provides room for the correspondent’s signature above the typed name and job title. This provides a professional format for the contract owner and adds a personal touch, allowing the contract owner to feel as though the inquiry was researched by an individual employee as opposed to a corporation.
- By using a variety of methods, Prudential offers its contract holders information and answers which reduce complex processes to simple, easy to follow advice. Ideally, business correspondence provides accurate information concisely. It must be emphasized, though, that conciseness should not be achieved at the expense of a personalized, friendly rapport with the contract holder. It is also crucially important to make the contract holder aware of the place his or her satisfaction holds in the company’s list of priorities. A good example of Prudential’s ability to convey this attitude is found in the following sentence from Page 4:
Please accept my apology for the delay in responding.
By asking the contract holder to “accept” the apology, rather than simply apologizing, the letter conveys a respectful tone which implicitly states that the company does not have an unconditional right to the confidence and approval of the contract holder. Earning the trust and approval of contract holders depends on convincing them that any shortcomings in service are deeply regretted and far below the level of service to which they are entitled.
- The Prudential Insurance Company also attempts to clarify most of the correspondence evaluated by using numbered or bulleted text. This allows the contract owner to locate the most important pieces of information within the body of the letter with ease.
The tone of the correspondence evaluates the general attitude conveyed toward the contract owner. Each letter is analyzed for phrases that are condescending, curt or abrupt. Any phrases found using this tone are mentioned in the following review.
While reading through the correspondence letters it was found that The Prudential Insurance Company did not always use a personal tone which convinces contract holders that they are reading a sincere, helpful letter.
In one letter, Page 10, the correspondent responds to a request for information about minimum distributions. The letter states:
If you have other Individual Retirement Accounts or Annuities, you will be responsible for determining the minimum required distribution from those contracts.
By stating “you will be responsible,” although the letter is providing accurate information, the tone is demanding. A balance needs to be maintained between making contract holders aware of their responsibilities and doing so in a pleasant, respectful tone that makes them feel as though they are equals in the business relationship. One example of the options available for explaining this to the contract holder is….
If you have other IRAs or annuities, please consult the companies which manage or hold them in an effort to determine the required distribution dollar amounts.
An additional example of a phrase that could strike contract holders as harsh is the following excerpt from Page 2:
When accessing the Prudential Web Site, follow these steps.
“Follow these steps” strikes the tone of an order being given to a subordinate. A way of phrasing this as a request is as follows:
To ensure that you are able to obtain the information you need, we ask that you follow the steps we have listed.
By rephrasing the response, the contract owner feels appreciated and is given the sense that the company regards him or her as an intelligent person who is interested in gaining access to a valuable educational tool.
In another example, the letter on Page 4 was sent regarding a request for information about six contracts.
You will receive information about policies 31 032 942, 310 32 941, R6 064 090, 38 238 157 and 37 349 313 from our Individual Insurance Group shortly.
This follows a sentence in which the correspondent apologizes for the delay in providing a response to the contract holder.
This may leave the contract holder wondering why the delay in responding in writing is being compounded by a second delay. The letter provides information about only one of the six policies, but no explanation or apology is offered concerning the delay in supplying information about the other five policies.
Requests for detailed information, which often require extensive research, can take a long time to fulfill. Despite the fact that there are many legitimate reasons for such a delay, it is important to let contract holders know why a delay has occurred. It is equally important to express regret and to empathize with the contract holder for any inconvenience this may have caused him or her.
Here is an example of one way to handle this situation:
Due to the need to submit a request to our research department for each of the policies in question, it was not possible to provide all requested information in this letter. Rather than wait until all of the necessary facts have been gathered, we chose to provide the information we have obtained thus far. The remainder of the information will be provided to you, in a separate letter, as soon as it is available to us. We regret any inconvenience this may because you and we ask for your continued patience.
A final point that needs to be made about tone concerns the importance of beginning all letters with “Thank you” and concluding each letter with a friendly offer of additional assistance. Although all Prudential letters in this series offered a means of obtaining assistance, not all began by thanking the contract holder for his or her inquiry.
The clarity of correspondence is reflected in the effort required to interpret and understand the response. The contract owner should be able to identify clearly the purpose of the response and locate with ease the important details within it.
The Prudential Insurance company’s form letters utilize bullet points and numbered text to identify main points within the response, as already mentioned. However, in the first paragraph of Page 12, one aspect of the contract holder’s inquiry is referred to, but the body of the letter does not provide any response to it.
The letter states…
Than k you for your letter dated <date>, requesting that we review the circumstances surrounding the delay in processing your asset transfer to <name of institution>.
In the remainder of the letter, only the question of the delay and any losses associated with it are discussed.
Prudential was required to process your withdrawal request within seven days from the date we received all of the required information. Since we did not process your withdrawal within this time frame, we credited you with legal interest…
No “circumstances” that caused the delay are addressed. This omission may be frustrating for the contract holder and, as a result, may reduce his/her confidence in Prudential as a service provider. This can be dealt with either by describing the reason(s) for the delay, or, as in the following suggestion, by explaining that it was not possible to ascertain the reason(s).
Unfortunately, due to the large volume of transactions our office processes, we were unable to determine precisely why this delay occurred. We do, however, wish to emphasize that this is not indicative of the timely service we strive to provide our contract holders.
The letter also states…
I reviewed our processing of your transfer request, and acknowledge that there was a delay.
By stating “I reviewed,” the correspondent is creating a positive image of an individual employee taking the initiative to determine all relevant facts before writing. However, by stating “I acknowledge that there was a delay,” the letter suggests that something more than the contract holder’s complaint was needed to confirm that there was, in fact, a delay.
The following alternative would strike the reader as personal response, but without any attempt to acknowledge what the contract holder already knows:
After you informed our office of a delay in processing your request, I reviewed our actions. Please accept our apology for not processing the transaction promptly. Since we did not process your withdrawal within the required seven day period, we credited…
A superior example of clarity can be found on Page 10. To provide a clear and coherent outline of IRS regulations governing IRA distributions, bullet points are employed. This prevents the necessity of attempting to write, in paragraph form, an explanation of these regulations. Such an explanation in a paragraph format would likely be confusing, given the detailed nature of the regulations.
In business correspondence, especially that which describes complicated regulations and options, conciseness is strongly related to clarity. Attempts at writing concisely, however, sometimes result inadvertently in “choppy” writing. While preferable to a long, confusing sentence, choppiness has its own disadvantages. The primary problem caused by such writing is that correspondence loses the fluidity that makes for easy reading. A letter in which the words do not flow smoothly does not persuade contract owners that they are dealing with an individual with a personal interest in their contracts. Rather, it suggests strongly that the contract is in the hands of a large corporate machine. It also reinforces the idea that the contract holder is only one among innumerable contract holders being serviced by the company.
The following two sentences on Page 2, although clear in meaning and grammatically correct, illustrate the effects of choppy writing.
Many other visitors to our Web site have made similar requests. We realize that this service would be of great value to our customers.
An improved version is the following:
This service would be highly valued by our customers and has been requested by many of them.
Another criterion that aids in achieving a professional style involves the use of words and terms that cannot be assumed to be familiar to everyone. Specifically, a mistake that companies often make is to confuse contract holders by using unfamiliar terms without making an effort to define them. Although the meaning of these terms can sometimes be deduced by considering the context in which they are used, this alienates investors by making them feel ignorant.
An example of a term which should be explained is found in the following sentence on Page 8:
Under this regulation, the contracts are aggregated to determine whether a taxable event has occurred.
The sentence that precedes the italicized sentence mentions treating various contracts held by one owner as one annuity contract, which makes it possible to infer the meaning of “aggregated.” Nevertheless, the letter would more effectively persuade the contract holder that Prudential is committed to educating him/her as an investor if the term were explicitly defined.
To ensure that its already superior service will be improved, it is suggested that Prudential follow the guidelines described in this review. In summary, the focal point of all correspondence should be to create an image of a large company that reduces it customer service functions to a smaller, more personalized level. It will, therefore, also be viewed as an organization that believes that one of its roles is that of educator. By addressing all issues raised by contract holders, Prudential’s correspondence will convince them that their investments are being managed with a thoroughness and personal concern. Finally, by employing a fluid writing style, Prudential can compose highly effective form letters that do not give the impression of being form letters.