What’s more challenging for brokers than nat cats?
What’s more challenging for brokers than nat cats? | Insurance Business Australia
Insurance News
What’s more challenging for brokers than nat cats?
And what can they do about it?
Insurance News
By
Daniel Wood
“I feel this demand is a good thing and an opportunity for us,” said Adam Ware (pictured top, right).
Ware is director of Melbourne-headquartered BJS Insurance Brokers. His firm took part in a survey by insurance technology company JAVLN of 500 Australian brokers from small and medium sized firms.
The survey asked brokers for their top industry challenge in 2024. Perhaps not surprisingly, unaffordable insurance came in at first place. However, the second spot was not taken by natural catastrophes or cyber risks.
Customer service – how challenging is it?
Instead, the intensifying demands from customers came in as the second top challenge.
“We know that demand for customer service has increased,” said Ware.
The rising importance of customer service is a common theme. Less well examined: the way this has increased the workload of insurance professionals and what they can do about it.
Are brokers starting to struggle?
The JAVLN survey, Brokering Change, found that about one quarter of brokers thought their customers would rate their service very highly. However, the same percentage admitted to finding the last 12 months tough on their customer relationships.
Ware and his colleague, Sydney-based Vanessa Morton (pictured top, left), took part in the JAVLN survey. Morton is a BJS Insurance director and NSW branch manager.
“We have a diverse range of customers, from large national companies to families,” said Morton. “Our customers are from many different sectors but some of our focus areas include motor trade, performing arts, professional risks and transport and logistics.”
She said customer expectations around service and expertise “are so much higher” today than when she started her insurance career two decades ago.
Brokers are their customers’ business partners
With these expectations, said Morton, brokers now need to understand the intricacies of their customers’ businesses and be able to offer customised programs to meet their needs.
“The relationship brokers have with their customers is beyond transactional — customers are looking for an insurance broker that is an extension of their business through growth, change and somewhat challenging times,” she said.
Brokers need to be responsive
On top of this, said Morton, is the need for speed.
“Responsiveness has also become so important and so much of what we do is time critical,” she said. “As a society we expect most things in real time, so being able to get back to our customers in a timely and efficient way is essential.”
What’s driving this customer service pressure?
Morton said one driver behind these increased expectations is a generalised change in how people view their relationships with service providers.
One reason insurance brokers are feeling more pressure, she suggested, is because this increased demand has coincided with “everybody in business” being time poor.
“COVID likely played a part in that,” said Morton. “The post-pandemic environment for business has been very challenging for several reasons — a tightened labour market, inflation and escalating costs have contributed to these challenges.”
How can brokers adapt?
Ware said his brokerage has changed and adapted to deal with the increased demand for more customer service.
“We have implemented many additional features to suit our wide variety of clients such as SMS reminders and follow-ups, online renewal questionnaires for clients to complete outside of business hours, an after-hours emergency response service for property damage claims, and much more — all of which did not exist 10 years ago,” he said.
Setting realistic expectations
Ware also offered some useful advice for brokers struggling with customer service demands.
“From an ongoing, general enquiry point of view, we’ve placed a real emphasis on setting expectations that are realistic from the beginning of the client journey,” said Ware. “There’s nothing wrong with telling somebody who has a complex query that it will take time to solve the problem they have.”
He said this safety valve is applied to both placements and claims.
“I still see some brokers promise the world in terms of timeframes, fail to deliver on that promise, then get upset with the client’s reaction,” said Ware. “If anything, in a market like this it is best to under promise and over deliver and if everybody is doing that, the general expectation within the community is set more broadly.”
When there’s an issue, intervene quickly
The brokerage director said he believes his firm does manage to keep most customers happy. However, sometimes it is necessary to bring a customer bad news. In these cases, said Ware, brokers should intervene quickly.
“We obviously cannot control premium increases, which will always cause some client dissatisfaction, or insurers going off risk,” he said. “If you have bad news regarding a client’s risk, jump on it straight away and talk to them.”
Ware said the client may even have a response that could give the insurer grounds to reconsider.
Are you an insurance professional? What’s your biggest customer service challenge? Please tell us below?
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