Insurers and brokers buried the hatchet at Strategy 2002. Many good ideas for the improvement of the business were discussed. Now it's up to us to turn words into action
The pressure for radical change in the general insurance industry is building. Insurance companies have never looked so fragile. Royal & SunAlliance (R&SA) has had to take unpalatable cost-cutting measures. Zurich has raised money in a rights issue to shore up its balance sheet. And AXA is in the middle of a major strategic turnaround.
As for brokers, FSA regulation is no longer an idle threat. October 2004 is the deadline for brokers to comply or stop trading. Regulation will put pressure on many brokers to rethink their businesses. Are they sustainable based on current models?
Two weeks ago, Insurance Times organised Strategy 2002 - a conference aimed at circumventing the traditional broker/insurer blame culture. Over two days at Newport's
Celtic Manor, brokers and insurers gathered to talk about the key issues facing the industry.
Under the chairmanship of Radio 4's John Humphrys, the directors who attended the conference questioned and debated. Brokers and insurers talked of new open relationships, sharing knowledge and creating new business models where risk and reward are more fairly apportioned.
Recruitment time bomb
Everyone agreed that the profession is facing a recruitment time bomb. And that if we can only explain what we do better, then quality staff can be recruited more easily. Consensus was also reached on continued and improved lobbying on issues of flooding and liability (see Strategic Issues - creating an action plan).
Because Insurance Times believes passionately in being part of a dynamic, world-class profession that can identify, discuss and act on the long-term issues facing it, we will create an action plan based on the conference findings. And act on it.
Talk is cheap. And that's why we are pledging to act on your key issues and report back regularly.
Insurance Times needs your feedback. We want you to look at the points raised in the conference and let us know what you think. We want to work on behalf of all of you.
So please take a few minutes to respond. Our website (insurancetimes.co.uk) features a special response box for your feedback entitled Strategy Feedback.
If you do not have access to our website, email( andy@instimes.co.uk ), fax (020 7618 3499) or write (30 Cannon Street, London EC4 6YJ).
Feedback
Once we have collated your feedback, Insurance Times will publish an action plan. Whatever you do, please contribute - there has never been a better opportunity to help shape the future of your industry.
And Insurance Times, with no vested interests, can take independent action.
Strategic issues - creating an action plan
Should we publish a magazine for undergraduates? We all know that there are many fulfilling and exciting jobs in the insurance industry. Undergraduates have a preconception that insurance is a job for grey men in grey suits. Perhaps a magazine circulated to undergraduates could convey some of the excitement and explain what insurance is all about. Of course, many of the big companies have successful graduate recruitment schemes, but many can't afford the expense. Could an idea like this help?
Can we change our image? The accountants did it ten years ago and the Army raised its image a couple of years ago with a series of striking TV ads. Can the general insurance industry do it too?
The grey army. The population is ageing and as graduates become scarce, the industry could do worse than look to older people. Norwich Union has already taken steps to employ "grey army" underwriters. Others feel that older people require high salaries and are not a long-term investment. However, the industry is facing a short-term and long-term recruitment crisis.
Skills test. How do your skills stand up? Would you complete a skills test to help us focus the content of our continuing professional development section. This information would be gladly shared with us.
Liability. The hysteria reached over the summer about employers' liability has subsided. We must keep the pressure up on the government and others to change the way liability is paid for. The conference unanimously voted that after a fixed period, liabilities should revert to a government fund.
Do we punch our weight? The ABI does good work behind the scenes lobbying ministry officials and Biba has had success with publicising the problems of our liability burden. But are the right ears listening? What could we do to get a meeting with Tony Blair or Gordon Brown? Is there a way of bringing more of the professions together in the non-life sector to lobby jointly?
Is the industry too inward-looking? Should we be doing more to adopt best practice from other industries?
Information. Andy Homer admitted at Strategy 2002 that he was amazed by the amount and quality of information held by brokers once he got on the inside. Is it possible to share some of that to prevent duplication. This raises questions about ownership of the customer, but anonymous information could be shared on an industry-wide basis, providing vital benchmarks.
Open book accounting. Many industries and professions have completely transparent charging - partnering. How far can this be applied to insurance?
Joint lobby with planners. The flooding debate revealed that planners are pushing in the same direction as the insurance industry on most issues. Can we join forces to maximise lobbying power?
Next generation leaders. Where is the next generation of industry leaders?
Do we have the talent within the industry or should we be looking outside the profession?
