Broker says new index will be based on facts, not perceptions
Marsh is developing a ratings index to help bring underperforming insurers up to standard.
The megabroker has been working on the idea with clients and insurers for a year. UK head of claims Barry Jones said: “We saw this is a positive thing for Marsh clients. If you want to be a serious player in the claims space, you have to say: ‘What is most valued by our clients?’.”
Brokers currently use Airmic’s Willingness to Pay Index to judge insurers’ claims performance, but Marsh claims its index will be based on fact rather than perception.
Jones said a range of criteria would be used to enable insurers to compare performance. “We asked what the seven or eight most valued things were. They are things like the insurer’s use of reservations of rights on claims files.
“Through the index we can go back to an insurer and say: ‘Here is your peer group behaviour in the PI sector around general reservations on claims advices. This is where you sit.’
“Let’s say they are putting general reservations on 20% more than their peer group. We can ask them why that’s happening and why they are so out of sync with their peer group.”
He believes the service will offer meaningful information to insurers that has been difficult to find.
“At the moment they are probably only aware of their own performance and they cannot see how they compare with other groups in the same sector," he said.