New research reveals confusion
The British Insurance Brokers’ Association (BIBA) is urging brokers to do more to explain their services and demonstrate the value that they provide to SMEs.
New research has revealed confusion among small businesses about what constitutes advice - and where they should go to obtain it.
The research found that SMEs who did not use brokers were confused about whether providers had searched the market and provided them with advice or information.
The research also established that small businesses that do use insurance brokers put great value on the service they receive.
Eric Galbraith, BIBA’s chief executive, said: “It is important that brokers play a key role in informing SMEs in what they do and how they can help them. This is even more important during the economic downturn when SMEs are likely to focus more on price. Brokers need to differentiate themselves from other providers by demonstrating the value that they add, both in terms of advising on cover and support in the event of a claim.”
Key findings of BIBA’s research include:
There is confusion about what constitutes advice and where to go to obtain it:
- Of the micro SMEs not using a broker; 33% of SMEs did not understand that they weren't receiving advice and were probably only being offered a single product
- In spite of the apparent confusion, advice is highly valued with 96% of SMEs who used a broker stating that advice was important
- Amongst both those who use a broker and those who do not, there is confusion as to where they can go to obtain advice; 63% of SMEs who did not use brokers said they received the service of identifying a suitable secure insurance policy and specialist advice when it is likely that a good proportion of them were mistaken.
However, insurance advice is valued by SMEs:
- Advice is highly valued with 96% of SMEs who used a broker stating that advice was important
- 94% of those using an insurance broker felt the broker provided reassurance that they have the right cover in place
- 89% felt using a broker allowed them to focus on their business
- 85% felt using an insurance broker ensures they always have a competitive premium
- - 81% that say that their broker identifies a suitable secure insurance policy and explains why it is appropriate for me with specialist advice
Delivering Value is the theme of the 2009 conference which will be held at Manchester Central between 13 – 15 May.
See also: Video reaction: Industry Guidance