If insurance brokers aren’t "adding value" for SME’s what does your future look like?


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Research recently undertaken by QBE makes for some worrying reading…that is, of course, assuming that there are still sufficient numbers of brokers with an appetite for the fight!

I sincerely hope that there is because YOU know that you do your job the way that it should be done. Don’t be shy tell people. Show them. If you do they will tell others because insurance customers are fed up with the mediocrity and hypocrisy that have become a trademark of our industry. Customers want and NEED to deal with people that they can trust.

ASK YOURSELF, how many people and organisations in our industry do YOU really trust!?

If you haven’t succumbed to the folly of a reliance upon unsustainable commissions…that are, probably still well below the levels paid to the “pile ‘em high” insurance salesmen masquerading as brokers…you still have a chance. BUT YOU DO NEED TO REALISE THAT, WHILST THIS IS A TIME OF GREAT CHANGE, MAKING A REALITY OF THE [HOLLOW] WORDS THAT HAVE BEEN ADOPTED AS THEIR OWN AND ABUSED BY THE SALESMEN, ADAPTING TO CHANGE AND LEARNING LESSONS FROM OTHER INDUSTRIES ARE “MUST DO’S”.

SERVICE – VALUE – INTEGRITY – TRANSPARENCY – TRUST – LOYALTY – STABILITY

These are the values that, from my experience, are truly understood by experienced insurance brokers and are not just the domain of marketers. One of the most significant changes currently taking place is, partly, as a direct result of the misuse of these terms by organisations whose greed has been exposed by the credit crunch and ensuing recession. THEIR GREAT STRENGTH IS ALREADY BECOMING THEIR GREATEST WEAKNESS. And even if they see what is happening they cannot afford to change.

clip_image003[1]                                                          WALK THE TALK

clip_image005[1]Demonstrate that you have embedded these values in your business, align your employees, relationships, placing, strategy, technology and service delivery. You WILL reap the rewards. Don’t waste your resources on salesmen. OK so some have more than just the ability to “talk the talk” but the customers who are worth having don’t want to be sold to.

Some wise words from our American cousins:

But how does the insurance industry keep up with the modern world and begin to fulfil the consumer’s unmet need for control?

“One way is by enabling the consumer through clear communication — moving insurance from being sold to being bought. People want to easily know what is and is not covered. The tools, services and business models that make it easier for the consumer to make the right choice for their individual lifestyles [or business] will ultimately gain market share and possibly the  trust of the consumer”.

I don’t agree with all that these guys say and at the end of the day they are looking to create opportunities for their own business BUT they have correctly identified this change, as I said, brought about as a result of an understandable lack of trust in the financial services sector…globally…and a FUNDAMENTAL REQUIREMENT TO FOR A FINANCIAL BUSINESS TO SUCEED IN AN INTER-CONNECTED, WEB ENABLED, WORLD.

MORE WORDS FROM MADDOCK DOUGLAS but I don’t share their belief in the institutional appetite for change. At least not the depth of change that is required to undo the harm that has been allowed to be done to our industry by the reckless pursuit of market share.

“Are big insurers capable of creating revolutionary innovation or just evolutionary innovation? We’re optimistic. Based on what we’ve seen lately it appears that the large insurers and financial institutions have an appetite for change. The economy has certainly given them a much-needed nudge.

If you work in the industry, here’s a test to see if you have what it takes to innovate in Insuranceland: We believe that the general public will be able to buy all types of insurance at a local Walmart soon. If you work at a financial services company and this idea sounds preposterous to you, you are being outplayed by a competitor even as we speak. If it sounds reasonable, you passed the test and are prepared to drive revolutionary change”.    

Warren Buffett said:

“Life is like a snowball, the trick is to find a really big hill and lots of wet snow.”

For insurance products, there is wet snow everywhere. Now, who’s ready to go find a really big hill?

WEALTH WARNING

HEED THE LESSONS FROM OTHER INDUSTRIES: I am not suggesting that “disintermediation” is imminent or inevitable for our industry but unless people who care about stakeholders, professional pride and their livelihood stand up to be counted who knows?

You don’t have to believe what Maddock Douglas are saying but there is much within our industry that is desperately in need of change. We can and should look to the experiences of other industries…after all your clients will be pretty diverse and will have had their own challenges. You may learn from them. They may even learn from you! You will probably find that, even having the conversation will strengthen your relationship.

Knowledge Brokering is featured in an interesting article from McKinsey the Global Consultancy firm

THE VERY ACT OF ENGAGING AND EMPATHISING WITH CLIENTS WILL DIFFERENTIATE YOU AND YOUR BUSINESS.

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