As broking networks help their members combat the current climate’s challenges, the Covid-19 pandemic admittedly hasn’t been all bad, resulting in ‘a more forward-thinking industry’ says networks MD
Brokers need to focus on “the difference between effective trading and efficiency” if they are to eliminate “wastage in the trading process”, says Jaime Swindle, managing director of networks and products for Bravo Networks, part of Ardonagh Advisory.
Speaking exclusively to Insurance Times, Swindle explains: “There’s a lot of wastage in the trading process. Risks being sent to multiple carriers on a pricing and comparison exercise, which increases the cost in the distribution chain because you’ve got five insurers all quoting for the same thing and ultimately only one of them picking it up.
“We need to be really smart about how effective we are with our trading and that drive for efficiency that’s happened at the lower end [of the market] has probably exaggerated a lack of efficiency in the corporate end, so there’s a little bit of work that we need to do there to try and make sure that we’re not wasting time, but we are still getting the best customer outcomes that we can do.”
Swindle thinks part of the solution here lies in networks “educating and supporting both insurers and brokers in the best and most effective way to deliver something meaningful to [customers] - and it doesn’t mean sending the same quote to five insurers with no intention of moving the business”.
“What I do hope is [the industry does not] end up in a situation where it becomes cost prohibitive to be a really good broker,” she adds.
Furthermore, professional indemnity (PI) insurance is also giving brokers headaches, both in terms of sourcing cover for clients as well as getting PI insurance themselves.
Swindle explains: “PI as a class was already under pressure from a rating point of view, but then actually brokers’ own PI on the back of what is nervousness around [directors and officers] and the [business interruption] test case is increasingly challenging. Excess levels [are] increasing [and] capacity in that market has pretty much contracted.
“We’ve got brokers who are in a situation where they’re having to negotiate their PI and they’re worried they’re not going to be able to get cover the next day, which means they won’t be able to trade. That is a bigger issue and one where it needs far more focus from an industry perspective.”
Future talent focus
A further issue that brokers need to address, according to Swindle, is the “need to create a culture of awareness around what the insurance industry actually is”.
“Its reputation has been somewhat tarnished by a lack of understanding into the industry but also a lack of talent and attracting talent,” she continues. “That bad press following the BI Supreme Court ruling has meant there’s a lack of trust in the industry again.”
This is where broking networks can really make a difference, Swindle adds, not only in providing education to brokers’ customers about how the insurance industry “goes beyond just the payment of the claim” to help clients “manage risks within their own [businesses]”, but also in supporting talent attraction.
For example, to take advantage of the government’s Kickstart Scheme, which provides funding to employers to create jobs for 16 to 24-year-olds on universal credit, “we bought a bunch of our members together to create a Kickstart collective”, Swindle says.
The networks have also been involved in a programme called Raise the Bar, which aims to foster the next generation of leaders within the industry.
“Attracting talent into this industry is the thing that will continue to keep it resilient, continue to make sure it’s doing the right thing for its customers moving forward and continue to keep it a really interesting place to work,” Swindle says.
Taking the ‘best bits’
As for the future of broking, Swindle predicts that pre- and post-pandemic highlights will merge to showcase the “best bits” of the sector moving forward.
For example, this would include retaining the industry’s “absolute focus on the client, the technical expertise that comes within the industry and the resilience of these businesses”, but adding the “open dialogue on wellbeing, on mental health, on diversity and inclusivity” that has become much more prominent since the onset of Covid-19.
“They were probably things that everybody talked about pre-pandemic, but I’m not entirely sure we were actually making a great drive to do anything about them,” Swindle says.
“Lots of these things have really come to the fore throughout the last 12 months and therefore we’ve got no choice but to make sure we are doing more than just talking about it, that we are now delivering on it.”
This will include being “far more flexible in the way that we work”, delivering “a change in leadership style” and building relationships in a more non-traditional way.
“What we will continue to see are the best bits about the expertise and the customer and the resilience, but I think we’ll also start seeing the best bits of the things that we’ve seen throughout the pandemic, which is a far more inclusive, diverse and maybe a more forward-thinking industry than perhaps we may have seen if this hadn’t happened and thrust us into this environment,” Swindle concludes.