Empathy and Data – Managing Vulnerability Complexity

A discussion with Andrew Gething, Founder and Managing Director of MorganAsh, on the challenges of managing customer vulnerability across financial services and other sectors.

The conversation explores how vulnerability management has evolved—from simplistic flagging to more nuanced, data-driven, and empathetic approaches—and highlights operational, regulatory, and technological barriers.

It also delves into the FCA’s Consumer Duty, the role of AI, and how firms can use customer understanding to drive both compliance and strategic advantage.

Find out more about MorganAsh -> Here.

Key Take Aways

Managing vulnerability requires both empathy and data, with both components being essential to mitigate customer harm effectively.
Frontline training alone is insufficient—firms have underestimated the scale and complexity of vulnerability across sectors.
Current industry practices are too simplistic, with methods such as age-based vulnerability lists failing to reflect actual customer needs.
The shift from ‘flag-based’ to ‘needs-based’ identification is underway, with a growing focus on actionable customer requirements.
Recording only customer needs is inadequate; characteristics must also be tracked to predict potential outcomes and enable timely interventions.
Vulnerability is contextual, depending on both the customer’s characteristic and the product or service they are engaging with.
Approximately 50% of customers are vulnerable, covering a wide spectrum from mild to severe vulnerabilities.
Legacy systems and data privacy concerns are major operational barriers to effective vulnerability management.
Proactive assessments reveal critical insights, but firms often assume—incorrectly—that customers will resist deeper questioning.
Strategic advantage can be gained through better data capture, with some firms using insights to develop new products.
Personalisation is the long-term opportunity, with vulnerable customer support evolving into broader customer-centric engagement.
Consumer Duty reinforces outcome-based regulation, with the FCA requiring firms to demonstrate that vulnerable customers receive good outcomes.

Innovation

Dual-layer approach to vulnerability: Capturing both characteristics (e.g., mental health issues) and corresponding needs (e.g., more time on calls).
Severity grading system: Each vulnerability characteristic is assessed for severity to inform response strategies.
Proactive vulnerability assessments: Asking structured questions directly to consumers yields richer and more relevant data than inferred indicators.
Data-driven personalisation: Use of vulnerability data to customise communication and service delivery, akin to consumer tech standards.
Outcome-first metrics: Moving beyond traditional KPIs like NPS to measure actual consumer outcomes, in line with FCA expectations.
Data portability vision: Enabling consumers to share vulnerability profiles across financial and utility providers via explicit consent.
Integrated benefit calculators and signposting: Linking vulnerability assessment to external support systems such as unclaimed benefits and local charities.

Key Statistics

~50% of customers are considered vulnerable, based on FCA Financial Lives data and MorganAsh’s own insights.
100+ vulnerability characteristics are tracked in MorganAsh’s tool, spanning health conditions and life events.
Ten-point severity scale is used to differentiate levels of vulnerability.
£26 million of unclaimed benefits are identified as potentially recoverable by individuals in debt, highlighting missed opportunities.

Key Discussion Points

Empathy and data are equally critical in managing vulnerability but often poorly integrated.
Over-reliance on outdated or oversimplified methods (e.g., adding all over-65s to vulnerability lists) can be counterproductive.
Understanding vulnerability characteristics allows firms to anticipate needs customers themselves may not articulate.
Data recording must encompass characteristics, needs, preferences, and severity to enable effective support.
The definition of vulnerability must consider the interaction between a person’s situation and the specific financial product.
Outcome measurement, rather than activity or compliance, is now the regulator’s core focus under Consumer Duty.
Operational complexity, particularly in legacy IT systems, hampers effective vulnerability strategies in large firms.
Customer trust and loyalty can be strengthened through tailored service, drawing parallels to traditional bank manager relationships.
AI’s current capabilities are overstated—there is no viable model today for predicting vulnerability without structured data.
Misconceptions about GDPR inhibit progress, even though data collection and sharing can be compliant with proper consent.
Firms that overcome these hurdles are beginning to derive competitive advantage through product innovation and better outcomes.
Broader collaboration (e.g., shared data between financial, utility, and government entities) remains limited but is a crucial next step.