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Ireland
The specialist insurer, which manages a wide portfolio of schemes, says the findings raise questions about whether insurers should be doing more to support brokers in achieving the right outcomes for customers.
The research found just a third of brokers (34%) are satisfied with the support they receive dealing with compliance matters, showing there is room for improvement to help brokers achieve their goals.
The FCA’s enhanced product value rules went live in October 2021 and require brokers and insurers to make sure, and to be able to demonstrate, that products provide fair value for customers. Just over half (52%) of the brokers surveyed said they believed the new rules would benefit customers, but only 47% said it would lead to development of better products.
“The goal of any Schemes relationship between brokers and insurers is always the customer. Ultimately, ensuring that they have the right product and right cover in place has to be the priority.
“The FCA has put a great deal of emphasis on this with the introduction of its product value rules. These clearly state their expectations about products providing the right outcomes for customers. Given this focus, it’s concerning to see that brokers need more from their insurer partners. At Ecclesiastical, we’ve invested heavily in this area, employing a new team within our Schemes area to ensure our products provide the right outcomes for customers. We’re already seeing the benefit of this work on product development and, ultimately, good outcomes for customers. I believe this will create a competitive edge for us and our scheme broker partners.
“Ensuring the best possible customer outcomes is what should underpin the decision-making process when choosing an insurer partner to work with.”
The survey also revealed that just over half (57%) of brokers are satisfied with their insurer’s claims service. Despite this, fewer than one in six (15%) are considering moving their scheme to a new partner, while a mere 3% already done so.
Among the biggest challenges cited in moving schemes to a new insurance partner was finding the right insurer to place a scheme with.
Brokers responding to the survey stated the main factors they look for when deciding who to place schemes with are the range of cover (80%), price (79%), ease of access to decision makers (76%), risk appetite (75%), and claims promise (75%).
The findings also revealed that almost half of brokers (45%) see schemes as a growth area, which is why picking the right partner is vital to brokers and their customers.
“It’s clear that there is some discontent among brokers about the service they’re receiving from insurer partners, but these findings show that the majority of brokers are tolerating poor outcomes from their relationships. Brokers need to look beyond the ‘easy’ option and find an insurer that understands the challenges they are facing. Settling for poor service will have a negative impact on brokers and customers in turn. A positive relationship with an insurer can benefit all parties.”