We bring you the key findings from sister title StrategicRISK's survey of corporate risk management professionals on the service they receive from both insurers and brokers
The UK StrategicRISK Corporate Insurance Buyer Survey is a chance for UK-based risk management professionals to give their opinions about the quality of service that they receive from their brokers and insurers. The 80 respondents – all anonymous – have been frank, and have identified areas where improvements can be made. We present the survey's key findings.
The word from insurers
• FM Global topped the insurer rankings for 2010 with Chubb Insurance second. However it is worth noting that FM Global received relatively few ratings indicating that it has only a minor presence amongst this respondent group. Chubb, on the other hand, is a major player and received ratings from 55% of respondents.
• Respondents overwhelmingly rated ‘value for money given quality of cover’ as most important service dimension. FM Global retained its lead in this ranking, well ahead of second-placed Chubb. Apart from FM Global, Allianz Global Corporate and Specialty Risk was the only other insurer to improve on its 2009 ratings for this important service dimension.
• Respondents considered ‘claims, fairness of settlement’ to be the joint second most important aspect of service. ‘Claims, speed of settlement’ was considered to be the least important. By comparing both sets of claims ratings together, only five insurers - Chubb, RSA, ACE European Group, Zurich Global Corporate and Lloyds of London - appear to have achieved the right balance, delivering better ratings for ‘fairness of settlement’ than ‘speed of settlement’.
• When asked to rank the importance of pre, actual and post loss service, post loss – that is immediate help to minimise business disruption – was ranked third. But just over 30% of respondents ranked it of primary or secondary importance.
• Risk managers said they are concerned that they are not being given sufficient opportunity to build better relationships with insurers. In response to a question about the ‘one thing’ insurers could do to improve their service, one said: “Insurers need to remember that we are the client” while another felt that the relationship ended as soon as the premium was paid, unless a claim arose. Several others wanted better communication; “listening to gain a better understanding” was a common theme.
• Apart from insurer Aviva, no other brokers or insurers, other than those cited by this report, have a significant market presence with this group of risk managers. Respondents were asked to indicate if they had used other brokers/insurers but no other firms received more than two mentions.
Brokers speak out
• Heath Lambert again topped the overall ranking table for service amongst commercial insurance brokers, followed by Lockton. However, Heath Lambert faced stiff competition and maintained its top slot mainly because of the lead it achieved in ‘level of risk expertise’. The company must lift its game if it is to maintain its overall lead for another year, as its ratings were generally lower than in 2009.
• International broker, Willis, showed the least year-on-year improvement, dropping down the league tables for three out of four service dimensions. It came fifth in the overall rankings, a disappointing outcome after its second place last year.
• The economic downturn means that the ability to understand clients’ changing business needs has become more important. Brokers did not rise to the challenge as overall ratings were generally lower than 2009, indicating risk managers were not as satisfied with the service they received this year.
• No broker could claim that their remuneration from insurers was fully transparent to all their customers. This impedes market efficiency; some risk managers will be less likely to benefit from premium changes and it dampens opportunity for product innovation.
• More than 75% of risk managers discussed with their brokers how economic conditions may have altered risk profiles over the past 18 months so that such changes could be communicated to insurers. However, a minority felt that the issue has not been treated with sufficient urgency or importance, and no broker could claim to have had such discussions with all clients. Only time will tell which view is correct and if the recession really has changed the commercial risk landscape in a way that has not been properly recognised and communicated to insurers.
• Significant numbers of risk managers could not compare and contrast service levels between brokers; the survey revealed that 45% of respondents used only one broker. This highlights how important this survey is as it provides benchmarks to show what the highest-performing brokers and insurers are able to achieve.