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Insurance Business | 14 Oct 2015, 09:13 AM Agree 0
One of Australia’s largest AR networks has announced a “subtle but unique change” in a bid to recognise the professionalism of its brokers.
  • Street Broker | 14 Oct 2015, 09:44 AM Agree 0
    A rose by any other name ...
  • Alan | 14 Oct 2015, 10:00 AM Agree 0
    Agree "Street Broker". A true Broker is the master of their own destiny. AR groups are notorious for dictating terms and suppliers. When this dynamic changes, we will view them as Brokers.
  • Shane | 14 Oct 2015, 10:17 AM Agree 0
    @Alan
    "AR groups are notorious for dictating terms and suppliers."
    We've been with Westcourt for a few years now and have never experienced this, so it might be time to change your view.
  • Alan | 14 Oct 2015, 10:52 AM Agree 0
    Nice to hear Shane. Do you own your clients though? Can you up and leave or are locked into staying with your current group? Most other groups (including one I was apart of) make it VERY difficult.
  • An A R | 14 Oct 2015, 11:12 AM Agree 0
    How under the current legislation can you possibly make an AR look more like a Broker?
    Are you talking about a Corporate Authorised Representative trading under their own name? It is already being done so what is the difference? Are you forcing each to have Westcourt in their name like Austbrokers do? Please tell us because it does not make sense what you are saying.
    These days an AR is not seen as inferior but recognised as the only way for an experience Broker, locked into lengthy restraints of trade, to start up your own business with expert support.
    Westcourt's announcement is all smoke and mirrors to me.
  • Kay Jackson | 14 Oct 2015, 12:35 PM Agree 0
    Don't see the difference, looks same to me - An AR is an AR and a Broker has their own Licence - There are good and bad on both sides - I know professional AR's same as I know professional Brokers - Just depends on if an AR wants to be and AR under another Licensee or wants to be master of their own destiny!
  • The West Australian Perspective | 14 Oct 2015, 02:58 PM Agree 0
    I personally can't see what all the fuss is about here and on face value it appears that Alan must be speaking from an insurers perspective as they could not be the comments of a fellow broker.
    Having been a Corporate broker for a big international for five years and then spending the last ten years as an AR and I find your comment suggesting we are not real brokers distasteful and disrespecting.
    Yes Alan I do own my clients and in case you don't understand an AR Broker has the same legal requirements as an "employee" broker or a Licensee for that matter of fact.
    Cannot see where you are possibly coming from with your comments and Kay, I can assure you that AR's do control their own destiny.
  • Winley AR | 14 Oct 2015, 03:13 PM Agree 0
    What's new here ?

    It's not the brand of the licensee holder that distinguishes you to your client, it's just you.

    I have my own brand under Winley, and yeah they are cheap and may not be known in the insurance world BUT it doesn't that matter. What matters is the knowledge, experience, service and relationship with your client as you and your brand matter more ?

  • Bruce | 14 Oct 2015, 06:43 PM Agree 0
    In the last year have had two different Westcourt AR's quoting on my clients insurance business. Both were extremely unethical, I kept both accounts but these people are seriously damaging the reputation of insurance brokers and I certainly won't be referring to them as authorised brokers. I wonder what ASIC thinks of this?
  • The West Australian Perspective | 15 Oct 2015, 09:31 AM Agree 0
    Bruce, whilst I empathise with your position on the behaviour of those two AR's if you really believe that kind of behaviour is confined to AR's then you are kidding yourself. As a thirty year insurance professional I have seen some appalling behaviours from "brokers" towards my clients and as for ASIC, forget them as speaking from experience they won't care less.
  • Street Broker | 15 Oct 2015, 10:33 AM Agree 0
    Agree with WA that I have witnessed sub standard behaviour from brokers as well as ARs but in terms of frequency of such behaviour it is heavily weighted in the AR camp. A possible cause is the culture of the 'parent' broker in the first place. The worst case examples of behaviour I've seen are from what I term the 'part timers'. Finance brokers, financial planners, stock & station agents, life insurance guys who have insurance broking as their second string to their main occupation. We're back to the bad old days before the Agents & Brokers Act ...
  • Shane | 15 Oct 2015, 12:43 PM Agree 0
    @Bruce.
    Brokers with their own licence never do anything unethical right? A scan through this very website will reveal stories of brokers dipping into their trust accounts and taking client's money. Does this mean all brokers are the same? Of course not! It's a shame that you've had a poor experience with two ARs, but that doesn't mean all ARs are the same, or that it has anything to do with the AR structure. My honest opinion is that some brokers are simply upset that competitors can now set up with lower barriers to entry than they had themselves twenty years ago. Times change... keep up.
  • Observer | 15 Oct 2015, 12:54 PM Agree 0
    Agree with you Bruce, we have recently experienced a Westcourt AR offering inferior cover & netting BPK policies to win business on price. The facts are the facts.
  • Bruce | 15 Oct 2015, 01:14 PM Agree 0
    Of course licensed brokers can be shonky as well but clearly the AR system makes it much easier for shonky operators to exist. I've been broking 25 years and haven't seen anything like the stuff I've seen in the last 12 months. When an AR can attach himself to three different licensee's in 12 months and the licensee doesn't see a red flag, something is broken. This reflects on all of us not just AR's.
  • Ross | 15 Oct 2015, 03:11 PM Agree 0
    I think that Westcourt have a different level of people and they are pretty strong on their compliance and training. Maybe this is why they can say they are broker reps? And yes - their guys are pretty active in getting new business.
  • The West Australian Perspective | 15 Oct 2015, 03:29 PM Agree 0
    Would agree with you Bruce on the last comment about the red flags. If this situation has actually occurred then shame on those Licensees. As I said before, don't rely on the regulators as they won't help, but that just smacks of terrible business practices by those concerned.
    However, may I observe that an AR is no different to any one of your employees and to try and differentiate us simply because of the job title is unrealistic.
    The fact of the matter is, as I have already mentioned, in our industry it doesn't matter whether you are an employee or an AR we all work under the same rules and to suggest that employees don't engage in this kind of behaviour is disingenuous.
    The last time I checked AR's are in the minority of those employed in our sector, so again it seems to me to be a case of the tail wagging the dog, with all due respect to some of the aforementioned comments.
  • M | 15 Oct 2015, 04:01 PM Agree 0
    Amazed at some of the comments, I can't believe some of you are so insecure in your businesses that you use a forum like this to snipe at professional brokers who operate as AR's. The reality with our industry is that there are good operators who provide a professional service to their clients and there are those who do not, it's the same as every other industry and it is not confined to the AR networks. Obviously there are plenty of people out there that are jealous of the success and freedoms we Westcourt brokers receive.
  • The West Australian Perspective | 15 Oct 2015, 06:03 PM Agree 0
    Agree with M and one final comment I wish to add on this whole thing would be this - Authorised Representatives are in fact Insurance Brokers and this is the reality, we are all the same because we do the same job!!
  • Radio Noosa | 16 Oct 2015, 06:59 AM Agree 0
    I agree with the sentiments that regardless of title, it's what a broker delivers that is the true test of their worth however Bruce's stance confuses me. RUOK bro?

    On the subject, having viewed a number of AR platforms the Westcourt model is without peer.

    Put it this way, if you are an AR under any AR model and portfolio ownership is an issue, you're hanging with the wrong crowd.
  • Mark | 16 Oct 2015, 09:48 AM Agree 0
    Bruce,

    Interesting - I am an AR (not Westcourt) and I have had multiple experiences where Steadfast and IBNA brokers quote against me but don't disclose (sometimes lengthy) claims histories. Now who is being unethical??

    And for the record - I own my portfolio, have a 90 day get out clause and have access to over 120 markets - so I actually 'broker' policies rather than channel it all to a friendly insurer who takes me out to lunch....
  • An A R | 16 Oct 2015, 04:41 PM Agree 0
    If it was as cheap and easy for ARs to get a Broking Licence as it was twenty years ago, you would not see very many ARs at all. The fact is, it is extremely expensive to get your own licence and you need to be part of a cluster group to get support and strength also. But bring in complicated laws such as the FSRA, demanding you have a Compliance Manager, a succession plan and manage Trusts, buy expensive Broker software as well as have access to many markets from a low base, to start your own business from scratch, you have to take the AR route.
    With Licence holders struggling to find decent staff to work for them, create a position for them where they are self-motivated and have a sense of ownership in the portfolios they create and he relationships they form and then at the end of the day be vicariously liable for any mistakes they make, what better way than to make them an Authorised Representative of your business. We are all still Professional Brokers that have to follow a code of practice and heavily scrutinised by the Licence Holder who wants to maintain his Brand reputation. ARs have to pay for their own education, their own training and development to stay qualified.
    So while Broker licence holders seem to have an issue with AR Brokers taking the low expense route to creating their own business, blame the Federal Government for bringing in one of the most stupid pieces of legislation in our Industry's history, the Financial Services Reform Act rather than snipe at each other about who is more professional than the other. This is the system that has been created by the FSRA. Live with it!
  • Robert Cooper | 19 Oct 2015, 11:36 AM Agree 0
    There are many different AR arrangements with licence holders. Mine allows me to own my own portfolio, I even have a Buyer of last resort deal with them. So I have actually have security and equity guaranteed.
    What is most important to me is it is almost like we have outsourced the Compliance, the IT systems and the Accounting systems. They provide support if we are ill or are inundated with claims during a disaster. They provide professional development. We have a network of very friendly colleagues who are also ARs running their own businesses. We share our knowledge. There are no ego issues, no envy or jealousy, we get help when we need it and we are left to focus on being actual Insurance Brokers as a result.
    I am so thankful that I am an AR (or correct that, a CAR) with NAS Insurance Brokers who have allowed me to have the best and most satisfying time of my career. I also consider myself an Insurance Broker because I act for the client to provide expert advice and service to protect them with good value insurance.
    I am so glad I took the AR route and I found NAS.
  • R | 20 Oct 2015, 10:44 AM Agree 0
    Well what a load of hot air, I have been a broker for 35++ years licensed before 84, then with a multi national & now as an AR with a cluster group and over those years, one of the many things I have learnt, is NO ONE owns a client. If price and service is not supplied you will find, they will move!! Instead of worrying about AR structures (which most Austbroker/Steadfast etc have various percentages of shareholding by insurers, which therefore hardly makes any of us truly independent) I would suggest keep advising clients as best you can and lobby against the direct marketers that seem immune from legislation requiring them to give any advice. Be the "Family Doctor" to their insurance needs, with as best price you can deliver and you should hold more than you lose!!
  • old duck | 21 Oct 2015, 08:59 AM Agree 0
    To me, the issue is not 'broker ARs' vs brokers. The problem is that the term AR can mean two quite different things. You can be an AR of an insurer, and therefore legally be representing the insurer, or you can be an AR of a broker, and be representing the client (well actually, legally, you're representing your licensee, but in practice you're being a broker).

    The two roles are quite different but are not recognised as such legally, and therefore certainly not by the insuring public.
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