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Should using a broker be compulsory?

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Insurance Business | 26 Jun 2012, 12:05 AM Agree 0
Broker associations overseas are pushing to ensure using a broker is a compulsory part of any insurance purchase. Could such a radical reform ever be forced in Australia?
  • Damian Scantlebury | 27 Jun 2012, 10:57 AM Agree 0
    Well, all you need to do is ask the Insurance Ombudsman. The complaints that come from the direct market are 4 times that of the broker market. Of the complaints from brokers, I believe 60% are resolved by the broker assisting the client before the Ombudsman makes final arbitration. Does this answer your question.??
  • Antonio Simeone | 28 Jun 2012, 05:53 PM Agree 0
    It should never be compulsory. What needs to happen is that the industry participants particular the product providers should encourage intermediation and distribution through independent intermediaries whose primary responsibility is to the client. Regretfully what we have is a product which needs professional intermediation because of its complexity, but which is being continuously prostituted in various ways by product providers and distribution channels that seek only to commoditise not only the product but the intermediation and through ridiculous mass marketing aimed at to encouraging direct transaction of insurance motivated by price as usually the only consideration.
  • Antonio Simeone | 28 Jun 2012, 06:00 PM Agree 0
    Having said that, most brokers in Australia have accepted profession devalueing initiatives like cluster groups and badging products and corralling clients into those badged products rather than engaging in independent tailor-made solution of cover for their clients. You have no idea how ridiculous the situation and how incredulous to the client that you can buy the same class of insurance from the same insurer and get different coverage depending on whether the client goes through a "cluster" broking group or through a non cluster broker or direct!
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