"The way people are purchasing insurance is changing"

“The way people are purchasing insurance is changing” | Insurance Business America

Risk Management News

“The way people are purchasing insurance is changing”

Risk management consultant looks back on his insurance career

Risk Management News

By
Emily Douglas

Jose Alfredo Suarez (pictured), risk management consultant Alera Group, didn’t begin his career in the insurance sector. Initially, he spent five years as a paralegal in immigration law, a period during which his mother, a Mexican immigrant, worked as an underwriting assistant for an insurance company.

She was the one who first got him into insurance at the Aon service center.

“I was pivoting between whether I wanted to remain in law or try something new,” Suarez said. “I decided to give insurance a shot. Twenty years later, here I am, still in the industry – one of those lifers.”

However his early career, and his background, did build an important foundation for working with Latin America. His role as an international service specialist at Zurich Insurance broadened his horizons, especially in handling policies overseas.

“We tailored master policies all across the world, but my focus was on Latin America and Spanish-speaking countries,” he said. “My passion was working in Latin America, Central America and Spanish speaking countries. My colleagues would come to me when Mexico wasn’t responding – and of course I’d call them, have a conversation in Spanish and a couple of hours later whatever my colleagues needed would be taken care of.”

In fact, one of Suarez’s most significant contributions to the industry was identifying and tapping into the underserved Latino business market. He developed a business plan focused on the Latino business owner.

“The buying power of Latinos was around three trillion at that time,” he told Insurance Business. It was an underutilized, untapped market that his agency wasn’t paying attention to. However, tapping into that new market meant a lot of education around new and potential clients.

“Instead of thinking about cost, I encouraged them to center their decisions around investment,” he said. “What are you willing to invest in your company so that you reposition results? I saw a tendency for a high claim scenario, high frequency, high severity, the worst of the worst and said ‘what are you doing to invest into your company, and into your culture in order to avoid some of these claims?’

“It’s holding the business owner’s hand as they scale from small business now to a medium-sized business.”

A significant part of Suarez’s role involves addressing the complexities of risk management. He enlightens clients on the nuances of risk transfer, especially in industries like construction, and the importance of having comprehensive coverage like cyber liability and pollution liability insurance. It was his move to middle market business that eventually presented new challenges and opportunities to devise creative risk financing solutions, such as captive insurance programs.

“I believe that’s where the biggest shift is happening,” said Suarez. “The way people are purchasing insurance is changing from your traditional model to a guarantee cost model to now, all of a sudden, captive insurance. The business owner is willing to take on a little bit more risk because they’re essentially paying more than half a million worth of insurance spend – even in situations where the costs are low.

“There’s certain captive programs where even a smaller span in that area would qualify them for these different programs. Again, that requires different levels of sophistication, more conversations with the CFO than the CEO.

“At the end of the day, it’s about making the best choice for your business.”