Where this direct sees advantages over the broker channel

Better engagement with customers and the ability to respond quickly to change are just two reasons why the leader of one of Canada’s biggest direct insurance companies sees an advantage for companies like his over competitors that sell through the broker channel, all of which is being enforced thanks to the COVID-19 pandemic.

Better engagement comes from dealing directly with customers as opposed to an intermediary and speed because there’s no third party to have changes funnelled through, said Ray Chun, president and CEO of TD Insurance.

Furthermore, the direct model that sees customers only dealing with the insurer “certainly allows for, I think, a more comprehensive, integrated solution — that you’re always, as a customer, dealing with TD insurance, whether it’s over the phone, whether it’s digital, whether it’s chat,” he added.

For Chun and TD, the key to moving forward will be making sure customers will be given the choice to communicate with them in whatever method they choose, be it over the phone, on its website, through an app or over webchat. “And I think that’s really what’s been missing in the insurance industry is this full choice,” he observed. “I’ve always said that consumers have not met a channel that they don’t like. So customers might start digitally, but then they want to chat with somebody because they have a question. So we have the click-to-chat capability.”

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Insurance can become a complicated process, especially when dealing with multiple products, Chun said, so it’s important that there’s a seamless transition to being in touch with an advisor — all without the customer having to go through the process of explaining what they’re looking after having just input that info online.

“It’s how do you create that ecosystem that allows for customers to pick the channel that they want to deal with, when they want to do it, how they want to do it and, when they need our advisors, simply and effortlessly engage with our advisors to support the digital experience?” Chun said.

When it comes to navigating an increasingly digital world, Mike Zaremski, P&C and insurtech investment analyst at Credit Suisse, agreed that it’s harder for those with a broker distribution arm to make things work faster and easier.

During the recent Cambridge Mobile Telematics webinar, P&C in 2021 – Market Catalysts, he said that it’s been a common belief that certain insurers, especially directs, are better positioned to make such transformations work. He was commenting specifically on telematics and the ability of insurers to get a better data-gathering solution out there. For those working through the broker channel, “I think they have to devote more time to figure out how to get that telematics data.”

Even when it comes to shifting his staff to work from home as a result of the COVID-19 pandemic, that’s an area Chun sees as having an advantage over broker channel competitors.

“If somebody had asked me two years ago, ‘Could you move your entire contact centre and back-office operations, to function virtually 100% from home in three weeks?’ I don’t think anyone would have said yes. I think it’s really a credit to our people within the organization. But our model allowed us to do that, for sure,” he said.

In the same vein, recruitment becomes easier thanks to the remote working model.

“Being direct allows us now to recruit from anywhere in the country. Access to talent and allowing people to work from home will actually be an advantage because of the fact that we actually can hire talent and recruit now from anywhere in the country to support our customers,” Chun said. “And that’s going to be a significant advantage on a go-forward basis.

“And I would say [that] might be more difficult if you’re a broker-based business — to move with speed, the way we’re going to be able to going forward.”

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