Media - Flaxmans at Eland Road
“A broker should not be put in a position where it is vulnerable to criticism, damage to its reputation or claims for damages by reason of unfair practices by others or unfair apportionment of blame.”
So started Flaxman on why Brokers today are vulnerable to all of those things because the coming together in the last twenty five years of computer technology, the web and the fragile infrastructure of the world financial markets has forced change upon the way insurance is sold and with it has come unintended consequences for the role of the broker.
Amongst them are the legal and regulatory obligations that are in danger of squeezing the life out of an important, skilled and advisory service; the Insurance broker……
Insurance exists because, without it, most people cannot afford to recover from unexpected loss or damage. In today's western economy insurance is an economic necessity. It is not a "nice to have", it is a must have.
We all know that the inherent weakness of an insurance policy is a combination of the words phrases and expressions in the policy and the integrity of the insurance company.
Insurance buyers of all kinds do not know how to distinguish one policy or insurer from another and that is why brokers are needed; to tell them, to guide them through the intricate, maze of insurance complexities and elephant traps to a policy that meets their demands and needs.
Insurance can be just as complex as tax, law, accountancy and medical science and the consumer and business economies need professional insurance advice just as much as they need professional accountants, lawyers and doctors but the industry is shooting itself in the foot in the way it portrays itself to its customers as a purveyor of a price sensitive commodity.
He went on to say “The marketing, sales and distribution of insurance, remotely and without human intervention, is simply increasing its profile as a bland, indistinguishable commodity of no particular consequence. There is nothing on the tin to say what's in it. If they look inside the tin the words and its complexity are meaningless. It is unsurprising therefore that the buyer seeks the cheapest tin on the shelf.” The root of the modern broker's dilemma is How to promote the real value proposition to the buyer and get well paid for it.
It is here to stay and we have to learn to deal with it but the successful independent broker of the future must achieve at least, public recognition as a professional adviser in insurance as distinct from a sales agent of an insurance company. Must possess the skill of conveying to the customer/client the inherent value of insurance policies and their strengths and weaknesses. They must know how to engage the customer in the value proposition of insurance and of course they must know and understand how to charge properly for its services.
There is a great future for great brokers
“I have recently been associated with raising awareness of the insurance industry’s tendency to be ever more rigorous in the payment of claims. I make no apology for that although I am aware that insurers do not like it being said. However Flaxmans is on the front line, every day, of disputed insurance claims and there are a lot of them. Too many to pass them off as occasional blips, as has been said to me by some of the insurers, recently.
I believe that there is a strong future for brokers because in the future there will still be a need for good, secure and fair insurance. The role of the advisory broker is becoming even more important today, when the option of buying insurance quickly and conveniently online is creating a greater distance between the policyholder and the insurer. Crucially, buying online removes the human touch. People are beginning to miss the ability to speak to someone and trust them.”
For a copy of transcript of the full speech email firstname.lastname@example.org or call today on 0207 702 4150.
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