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Aussie brokers facing their greatest ever threat

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Insurance Business | 19 Sep 2012, 12:07 AM Agree 0
With Australian insurance comparison site iSelect looking to raise $25m in capital, in a time-poor and digital-led age, evidence suggests such companies are the biggest threat to insurance brokers...
  • Robert Cooper | 19 Sep 2012, 10:58 AM Agree 0
    We have been warned about such aggregation models before and we are in competition now with AAMI and NRMA's direct insurance. It really is up to us Brokers to sell the value of Personal Service, Consultancy and advice and point out the draw back of using on line facilities - the Floods being uninsured on Direct Insurer's policies is a classic example. Insurance Brokers assist in Risk identification, have experiences with actual claims on different risks and use negotiation skills with the underwriters to get the best cover at the best price. You will not get that from on-line facilities.

    And if an Insurance Broker can get hit with a 2.7 million dollar claim for answering an EPS question wrong, imagine how many similar mistakes an ordinary consumer could make trying to arrange cover on-line? Insurance Brokers and all our cluster groups and industry associations need to focus on that.
  • Victor Caballero | 19 Sep 2012, 11:52 AM Agree 0
    I very much doubt that the role of the broker can be replaced - particularly when it comes to commercial policies.

    In my experience providing brokers and underwriters with both product development and IT platforms, I also doubt that the demand for online refers to comparison sites but rather demand for efficiency in dealing with brokers.

    Aggregator models for SME's have long been predicted as coming to the Australian market even though experience in the UK has been mixed as pricing is difficult for underwriters to control.
    It would be interesting to see how many enquiries brokers receive through their respective contact forms on their websites.
  • Elizabeth Rainford | 20 Sep 2012, 09:26 AM Agree 0
    The plain facts show that the use of the internet as a business tool is not an emerging phenonomen it is here to stay. The Insurance industry has not kept pace and will now try to catch up with the models offered by the aggregators. As a Broker Systems consultant I do not endorse full on line quote and close or comparison models, however Brokers are not putting any alternative models that support their personal service ethic in front of client. The mind set on the value of the product (versus the clainms outcome)and expectations of the insurance consumer (even companies) is being developed by the lower end of the market.
    It is a challenge to develop a service based on line model, however it can be done.
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