What is the future of the short-term insurance broker?
There is immense pressure on the short-term insurance broker. Between a tsunami of regulation and the rise of various direct distribution models, brokers have been struggling to find business models that will be sustainable into the future.
(for more information on the Summit click here)
It is not only the personal lines business that is under threat. Direct models, especially due to various technology innovations and pressure on margins within mainstream insurers using broker distribution models, have seen the gap and are entering the commercial lines market. This is especially so in the SME market, where economic pressures are motivating small business owners to shop for cheaper prices.
- Will brokers survive this onslaught and what role does product providers play in this future?
- Do product providers even have a role to play here and should they be putting effort into ensuring the survival of the broker?
- Have brokers been unable to adapt to a new age of customer driven distribution models?
- Will brokers be missed when their numbers dwindle?
My answer to all of these questions is a resounding YES!
Brokers have been slow to adapt and have not put enough effort into really ensuring clients understand the value of using an intermediary. There certainly is a difference between a direct client / provider relationship and a client/ broker/ provider relationship. The problem is that clients mostly do not even think about the benefits, they simply see the price.
My opinion is that regulation and the offices of the Ombuds have slowlyy been taking over the role of the broker as the "man in the client's camp", at what cost to the client and the product provider?
At this very important Short-term Insurance Broking Summit, we have a host of high profile speakers lined up to comment on, debate and discuss these issues.
Now more than ever we need to ensure we have a full understanding of the current positing of short-term insurance broking and the full consequences of the myriad of changes putting pressure onthe survival of the broker.
Join us on the 18th of April at the Sandton Convention Centre to participate in the discussions.
Self Employed at National Auto Glass
8 年Every industry is under pressure forcing businesses to work smarter and more productively. As is the case with the insurance industry rationalizing suppliers, the same should apply in their industry. Maybe they can take note of the Outsurance model who's success and returns are driven on direct customer service cutting out the middle man. They are also true supporters of local industry looking after the local economy which creates much needed employment.
Chief Sales Officer/ Business Developer/ Country Manager / Sales Director
8 年As a side comment - there is definitely a place for the short-term insurance intermediary in the market BUT it is up to them to be nimble and responsive in the market. Unless they take up the challenge and find ways to secure their livelihood they will become irrelevant in time to come. Whilst the cost of compliance are always escalating the revenues resulting from these are decreasing so they will have to find other ways to continue being service providers and advisors at a lower cost.
Owner, COVER Publications
8 年Indeed Mbongeni Bhebhe. The landscape is changing incredibly fast and, although many of the basic principles and values stay the same, the operating models are the most in need of innovation and adaptation. They need to be re designed, not just adapted.
Executive Director at Horseback Advisory
8 年Whilst it indeed is a turnaround for ST insurers, its equally the same for LT insurers. Regulation alone has become a core barrier and those insurers, both Long and Short, who have embrenced these changes and relooked at their business models and the soul of their businesses are likely to survive the tsunami. Soon and very soon, the combination of regulation and data will simply shift the way business is currently run. The huge offices and staff to suppory product offerings will not be sustainable into the near future.