The webinar also discussed the growing opportunities for smaller brokers, the potential impact of a change in government, and the mounting regulatory burden since the introduction of Consumer Duty.
You can watch the session in full below or read on for a quick summary of some of the main talking points.
Partners& chairman Stuart Reid expressed excitement about the future of the broking market, particularly for smaller brokers.
“Some brokers have got very, very big, and in the mid-market there's a massive gap,” he said. “For some of those smaller brokers to move up into that mid-area – it’s a fantastic opportunity for those that want to do it.
“I genuinely believe the opportunities for the small to medium-sized broker are better now than they have been in many, many, many years because there isn't much competition in that mid-market. Get into there and you become quite a rarity, and what happens with rarity? You get high value.”
While there are opportunities, there are also challenges and one of the biggest is the level of regulation facing brokers today.
Reid explained that most broking firms are made up of 10 people or fewer, and said that the impact on these small businesses is particularly concerning.
“You've got small businesses that are tackling this new regime – this new way of reporting – at a time where they've got to service clients and prices are going up,” he said. “The larger firms that have their specialist compliance risk units are able to deal with this and soak it up a little bit easier, perhaps, than some of those small brokers. So it's the impact on those small brokers that gives me cause for concern.
"The industry as a whole would say that there's been a lot of change, we're getting used to it, we understand it, and we would like – to use a football analogy – for the FCA to put a foot on the ball for a little while and let us just get used to this new this new era, and the ramifications of it.”
Fellow panelist and Insurance DataLab co-founder Matt Scott agreed, and said that smaller brokers need to be smart about managing compliance so they can carry out their day-to-day broking activities alongside their compliance requirements.
"Having the right data strategy to properly evaluate your insurer partners, and properly report on the business you're doing is key,” he said. "It’s all about sitting down and making sure you have the right plan of action around that, and then going out and enacting it.
“That’s why we look at things like underwriting results, solvency positions, complaints handling, and customer and broker experience, and having that data alongside how the actual products are performing gives you a 360-degree view of how your insurers are performing and how your business is performing. That can then be used to help inform decisions and inform your reporting.”
Kelly Ogley, CEO of Howden Consumer and Local Commercial, added that using such data proactively allows brokers to offer better service to their customers.
“With our Consumer Duty dashboard, we can look at our insurer partners and see who is being responsive, who has great settlement rates – and anybody that doesn’t we can dig into,” she said.
“So it's really just making sure that the terms are fair, they’re very clear and transparent in what they’re covering, and then the big thing is that claim settlement – making sure at the point the client needs us most, both the broker and the insurer partner are there.”
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