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What is Trauma-Informed Financial Advice?

Sapience Financial recognises while everyone is 'going through something,' some people are going through so much more.

Trauma affects people differently and trauma-informed organisations are those who redesign their process and approach to serving their customers and supporting their team, so as to reduce and minimise the risk of re-traumatising a person by unnecessary and ill-considered business practices and customer and team interactions.

Nobody understands the impact of trauma, stigma or discrimination better than the person experiencing it.

Sapience is a Trauma Informed Organisation specialising in financial services and specialist insurance adviceWhile the field of Trauma Aware study is evolving, we believe good leaders 'don't just wait and see'.  Sapience Financial have redesigned all aspects of service delivery guided by a consideration of the potential trauma history of those who engage with our service.

An uncomfortable truth

Trauma affects us all, directly or indirectly. Not all traumas are visible or obvious.

The uncomfortable truth is, that many people live with the ongoing effects of past and present overwhelming traumas that can range from stigma and discrimination to violence, abuse, and terrible historical life events and experiences.

How does this relate to Financial Advice?

Trauma often affects the way people approach potentially helpful relationships. That includes Financial Advisers like ourselves.

Despite the large numbers of people affected, many service providers rarely think about the possibility that someone we meet, speak with or provide professional services to, may have experienced trauma.

  • This makes them less likely to recognise it
  • This then increases the risk of inadvertently hurting (and potentially re-traumatising) the very people we seek to serve.

While many individuals will find a way to process their traumatic experiences and get on with life, some traumas have lasting effects that bleed over into all parts of our lives. And of course, whatever affects our emotional state usually affects our mental health and financial situation Good Mental Health & Money too.

This is because many trauma survivors feel unsafe, have good reason to distrust Banks and Superannuation Funds, and often have a good reason for their concerns about information privacy, stigma and discrimination within Australian Financial Services. Add to this, trauma resulting from community and family discrimination and stigma can create additional and complex feelings of isolation that interrupts peoples seeking and forming helpful professional relationships; and as financial advisers, that directly relates to us.

Sapience Financial is Australia's first Trauma Informed Organisation providing Specialist Insurance Advice

An important missing piece in Australian Financial Services

Sadly, such human insights are usually absent within financial advice practices, which traditionally have no structure, procedure or commercial interest in looking to incorporate these trauma-informed insights into the way the business delivers its services to its clients.

The rise of Trauma-Informed Practice Standards in healthcare

Trauma Informed Practice is currently emerging in the domain of health and children's services as a framework of how to deliver a service in a way that understands the impact of trauma in people's lives and values ‘how it's delivered’ as just as important as ‘what it delivers’.

  • What Trauma Informed Practice is not: about simply adding a quick additional layer of information gathering or customer segmentation.
  • What Trauma Informed Practice is: a transformative process building upon itself and over time with the specific intent of 'operationalising' a more humane and compassionate service delivery.

If you want to read more about the science behind the system read below

For those who like the detail

There are currently four progressive levels of accepted Trauma recognition.

  1. Awareness by the services staff
  2. Sensitivity - where some operations aspects have been modified in response to trauma insights
  3. Responsive - where protective factors are in use, with the highest level
  4. Informed - where an entire organisational culture has been remapped and empowered through all work philosophies, practices, client interactions and methodologies (and physical settings) reflects the expression of a trauma informed approach. (Miesler and Myers, 2013)

You can learn more about trauma informed Care operating in Health Services here.

SAMHSA's (2014) approach to trauma informed care makes four key assumptions that must be present as a basis of implementation for trauma-informed care, with a further six key principles to then be applied.

Principles of trauma-informed care have been discussed in a range of academic literature and guidance publications (Elliot, 2005; Hopper., 2010; Jennings, 2004; Kezelman & Stavropoulos, 2012; SAMHSA, 2014) Essentially they have the same underlying philosophies of trauma-informed care means services are trauma aware, safe, strengths-based and integrated.

In a Nutshell: At the very minimum, trauma-informed services aim to do no further harm through unintentionally re-traumatising individuals by acknowledging traditional business practices may be an inadvertent trigger for exacerbating trauma symptoms.

What is a Trauma-Informed Organisation?

A trauma-informed organization is recognised as ‘one in which all components of the system have been reconsidered and evaluated in the light of a basic understanding of the role that violence and trauma play in the lives of people seeking mental health and addiction services'. Jennings, 2009

Becoming trauma informed is about supporting our prospective clients and established clients to feel safe enough in their interactions with our financial and insurance services. Drew Browne

The need for Trauma Informed Practice in Financial Advice

Sapience Financial and our specialty brand Unusual Risks Insured are the first Australian Financial Advice practice to proudly stand as a Trauma Informed Organization. We are fully committed to protecting the dignity and safety of our clients and staff. To help us better deliver specialist Financial Advice we have redesigned all our systems, processes and customer interactions, informed by understanding the impact of trauma in the lives of those we seek to serve.

How we do this in practice?

The process is designed to be invisible to the client. Whereas the medical community might use a questionnaire to screen for specific trauma events, we just assume all our clients are living with varying degrees of trauma histories and treat all our prospects and clients with a higher level of care and design our processes with that assumption.

Adopting a trauma-informed approach in an organisation is not done through simply adopting one particular approach or checklist, but usually requires an ongoing assessment and monitoring of processes, practices, leadership and culture change at all levels.

Why do we do this?

As a financial advice practice, Sapience Financial is already legally required under the Corporations Act 2001 to both know our client and have a reasonable basis for giving personal advice.

  • This is known as the 'suitability rule' or 'know your client' rule.

But as we’re also a Specialist Risk Advice Practice and often get to know additional and sometimes far-reaching personal health information about our clients.  This is due to the legally mandated Duty to Take Reasonable Care Not To Make as Misrepresentation (formally known as the Legal Duty of Disclosure) requirements of the Insurance Contracts Act.

Due to the Duty of Disclosure laws, (now reframed as The Duty Not to Deceive) where everyone making an application for insurance has to fully and frankly disclose information as requested ...

... we can end up having deep insights into the confidential health and lifestyle information of our clients, recreational drug use, sexual histories, IVF, STIs, mental health, trauma events, depression and family health histories – matters usually only spoken about in total privacy with their local Doctor or therapist. This is why we choose to be a Trauma Informed Organisation. Drew Browne

This legal requirement for full and frank disclosure about health and lifestyle issues can understandably create anxiety and apprehension for many people for many reasons - and if not understood and supported, usually sees most people who would benefit from such advice, either abandon the process or avoid it altogether.

Practical Benefits to our Clients and Our Team

In a Trauma Informed Environment trauma is everyone's responsibility.

Our prospects suppiers and clients are better served with safe and appropriate processes, and services purposefully designed to be more accessible, more self-empowered and more informed about how to avoid unintentionally re-harming them as we work through our business practices and service delivery.

Staff and team members, who may have their own trauma histories, are kept safe from the risks of secondary traumatisation from working with multiple people who have experienced significant life traumas.

Why this matters and why it will determine the future of specialised Financial Advice delivery?

Implementing these values requires an organisational change at every level where all team members and a fundamental reframing of the typical financial advice service relationships.

Without an understanding of the principles of Trauma Informed Service Delivery, a compassionate a technically excellent financial advice practice (and their customer interacting supplier) may inadvertently end up hurting the very people they are hoping to serve.

We believe, unless all our financial advice services are trauma-informed, even the best financial advice, may be inaccessible or ineffective.


author pic drew browneDrew Browne is a specialty Financial Risk Advisor working with Small Business Owners & their Families, Dual Income Professional Couples, and diverse families. He's an award-winning writer, speaker, financial adviser and business strategy mentor. His business Sapience Financial Group is committed to using business solutions for good in the community. In 2015 he was certified as a B Corp., and in 2017 was recognised in the inaugural Australian National Businesses of Tomorrow Awards. Today he advises Small Business Owners and their families, on how to protect themselves, from their businesses.  He writes for successful Small Business Owners and Industry publications. You can read his Modern Small Business Leadership Blog here. You can connect with him on LinkedIn Any information provided is general advice only and we have not considered your personal circumstances. Before making any decision on the basis of this advice you should consider if the advice is appropriate for you based on your particular circumstance.

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