Brokers and insurers will need to come together on innovation as client needs and expectations continue to shift, one expert has said.
In the recently released EY 2017 Asia-Pacific Insurance Outlook, the growing importance of technology across industries, including insurance, was identified as a key issue that is changing the way clients interact with the industry.
The report notes that advances in digital technology and the rise of younger consumers are raising customer expectations for innovative products and businesses.
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For brokers, optimising the triumvirate relationship between themselves, insurers and clients will be key to ensuring their place in a changing market, according to Grant Peters, insurance sector leader for EY Oceania.
“Insurers want to get more direct access to the consumer than they have had before while still managing a broker force that is used to owning the consumer,” Peters told Insurance Business.
“Where the most successful arrangements are is where the insurer and the broker can get alignment on innovation.”
Peters noted that innovation can come in many forms. Whether it be through improved digital interfaces between insurers and brokers, a proactive use of data and analytics to help gain specific client insights, or attempts to increase productivity, brokers and insurers will need to work together to improve customer relations.
Segmentation of a broker’s client base may become a more important issue in 2017 and beyond. Peters said that direct competition in certain markets could force brokers to focus on a high-end client base and the industry has already moved down this path both at home and abroad.
“With modern tech and data and new entrants, the cost of sale has come down quite a lot over the last few years so insurers can’t afford to always go through brokers or the middle-market on the lower end,” Peters continued.
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