- Total posts: 453
Some really good points above – here are my thoughts:
Simplifying the Policy Wording – this would be fantastic, however these are provided by the insurer (not by the broker) so we are bound by their words.
In relation to making them simpler to understand and to identify key points – it is quite difficult to ‘over simplify’ a legal contract. Furthermore what one client deems important another doesn’t (this is why I never just work with ‘off the shelf ‘ solutions). This means you really have to know and explain to each client the relevant wording and what it does and doesn’t do.
For me – I work with over 100 different wordings (which change all the time) so it is hard to have a ‘ready reckoner’ for clients.
Case Studies – these work, however it is important to realise that they are only valid in relation to a specific policy wording (what may be covered by one policy may not be covered be covered by another).
Cyber – this is the flavour of the month cover at the moment with high profile hacking / privacy breaches and the introduction of mandatory reporting later this year – we see insurers rushing to bring offerings to market on a regular basis. The issue you have (both as a broker and a client) is that the covers are currently so very different (as the underwriters struggle to work out what exactly their cover and pricing points are) and they all market themselves as being better than the competitors. Hopefully with an increased premium pool in the near future the disparity gets addressed.
The broking industry in general – in a world of DIY everything, the insurance broking industry struggles to market themselves as relevant. Adding to this the following:
– insurers (CGU / Allianz are two) that are bringing direct to consumer offerings and then saying ‘if you have a complex business contact a broker’ – many business owners don’t think they have a complex business, but they don’t fully understand all their exposures or what they could be covered for (they don’t know what they don’t know).
– target markets – as mentioned brokers may consider smaller risks as not being ‘preferred’ due to the amount of work with a lower return (you can’t bill a startup SME on a fee for service basis – I am currently working with one and have been for 6 months on/off almost pro-bono as her product and requirements are quite niche – if I charged per hour it would be a bill she couldn’t afford). The issue is – Micro / SME businesses are the ones that probably need an insurance broker the most because they don’t have risk management programs or legal teams to set contracts – our industry fails at that.
– perception of brokers – as Bert said, you see insurance shoved down peoples throats as being about cost. How much you can save, how cheap it can be. Yes it is a grudge purchase for most, but as I always say it is like a parachute – you buy that you never want to use, but if you need to use it you want it to work. The problem is that because (relatively) few policyholders need to claim on specific covers, they see those policies as being a waste of money, not a cost of being in business. I have lost count of how many times I have tried to change perception that I am not an insurance ‘salesman’ – I don’t ‘sell’ policies. I provide insurance advice and source covers that meet their needs.
Its certainly a hard one and I don’t know how it gets changed….
PS. Mischelle – sounds like you have an interesting business. Not sure why you had so much issues or had jump through so many hoops to obtain cover. I do a few in that space (IT and PI – my last big one was for the management and operation of a power station) and I have access to very good knowledge bases so if you want to bounce concepts or run anything past me I am happy to help