December 3, 2019 by Jason Contant
It would appear that brokers and carriers want each other to “take on a little bit more,” in this hardening market, attendees to Insurance Bureau of Canada’s first-ever Commercial Insurance Symposium heard last week.
Carriers want assistance in general underwriting, servicing and claims. “They want brokers to take on a little bit more work and, a result of that, reduce some of the servicing costs for the carriers,” said Greg Bubela, manager of strategy and operations consulting with Deloitte Canada.
For their part, “brokers would like see carriers take on a little bit more than just their one specialty market or one line,” Bubela said. “They obviously like carrier to write more risk.
“That’s a big pain point between brokers and carriers. Brokers don’t really know what the carrier wants to write this quarter, and [brokers] will do a bunch of submissions and the carrier declines all of them,” Bubela said during a panel discussion titled State of the Industry: What’s Driving the Commercial Insurance Market? with two other Deloitte speakers. “They don’t know why, [the carrier] didn’t tell them. It creates a lot of confusion, undue effort and talent on the broker side when having to go to the carriers.”
So, what do brokers want? “Definitely at least open communication from the carrier as to what they are willing to write.”
Bubela was discussing a secition of Deloitte’s recent commercial insurance market insights report. It involved a survey and interview of IBC’s commercial carrier and broker contacts (carriers with commercial books from $7 million to $3 billion, and brokers with commercial books from $5 million to $600 million. Global brokerages with an established Canadian presence were included, as well as regional and/or niche brokers in the commercial market).
While both carriers and brokers surveyed identified “talent quality & availability” as the top external pressure, the survey found brokers and carriers are misaligned in what they are seeking from each other. The survey looked at carrier needs and broker needs and how to work together better in the future to drive symbiotic growth.
Besides assistance in underwriting, servicing and claims, carriers want more transparency with their brokers, to be treated as partners and to know more about the customers they are serving. “If you read between the lines, [it’s] potentially owning more of the customer relationship. They really want to get involved and know who they are servicing,” Bubela said.
For brokers, besides greater carrier risk appetites and greater range and/or quality of products, they also want improved carrier servicing quality. “Speed is a huge issue here,” Bubela said. “If a carrier takes an extra day to turn around a submission versus another carrier, that can be the difference between being able to write the business and not. Brokers really want to see increased speed there, and a lot of that will come with connectivity.”
And with a trend in the market for carriers (and brokerages) to move towards niche or specialty markets, brokers “can’t get a hold of the coverage you need for your client from one carrier, and you have to move around a lot.”
“Brokers would like to see carriers take on a little bit more than just their one specialty market or one line, so they have more of a relationship. And obviously for the carrier, you have more share of the wallet and so that can help you with your growth strategies as well.”