Insurance industry ’hasn’t covered itself in glory’ over business interruption claims, says Brendan McCafferty
The business interruption claims fiasco has created a population of “confused, anxious and angry clients”, according to Brightside chief executive Brendan McCafferty.
He told Insurance Times that although the broker is not “at the sharp end”, it has customers and clients who have been directly affected.
”Our brokers have done a good job in the first instance in explaining cover and providing choice,” McCafferty said, adding that ”on an industry level, it’s just very frustrating”.
”If you’re running a major corporate insurer, you have to do the shareholder thing and go through the loop. But it misses the point about the expectation of the client, perhaps those who are less sophisticated than one with a risk function.
”The industry hasn’t covered itself in glory,” he added.
The test case is a reminder to everyone to pay attention to the detail in terms of explaining to the customer what they’re buying and what they are not buying, McCafferty said.
He continued: ”The best thing you can do in these circumstances is to acknowledge the problem and work out what you’re going to do about it. That’s where the industry needs to move itself to.”
Brightside has 100% of its staff working remotely since the first Covid-19 lockdown.
McCafferty said this is set to continue until it is safe enough to do anything else.
The experience has so far been “hugely informative”, he said.
The flexible working model brings all sorts of benefits, according to the broker boss.
“We’ve learnt how to run our business with a strong analytical base. We know what people are doing. We know what our productivity looks like. There are good customer outcomes from that.”
The company is paying more attention to what is going on in the service model and outcomes for the customer.
”If you can’t sit behind someone and say ’so and so is working hard today’, then you have to resort to a more rational way of assessing [productivity].
”You need to compensate culturally and make sure people are supported, focused, trained, etc.
”We’re seeing sickness levels fall off a cliff. We need to move to a point in the future where we have the best of both worlds - the office location and the benefits of virtual working,” McCafferty said.
The move away from an office-based operation has also helped, because the business is no longer constrained by the existence of buildings that defined the products sat within those buildings and operated in silos.
”All of that has broken down, we’re also bringing the best of Brightside to every part of the business.”
Last week, Brightside announced it was putting MGA Kitsune into run-off because it was unable to deliver the same level of returns that the core broking business did.
That announcement came on the same day as the business reported an EBITDA of £5m – a £570,000 drop compared to 2018 in its annual results.