Australian insurance firms gear-up for long-term changes

Australian insurance firms gear-up for long-term changes | Insurance Business Australia

Australian insurance firms gear-up for long-term changes

Editor’s note: The following article was written prior to the recent COVID outbreak in NSW and accompanying restrictions.

Australian insurers and brokers have adapted well to the challenge of COVID-19, proving their resilience and the important role they play in the economy. For many firms, even working from home was no barrier to looking after the changing needs of their clients who suddenly saw their worlds crumble due to COVID lockdowns.

According to Dallas Booth, the CEO of the National Insurance Brokers Association, however, the pandemic means the Australian insurance industry will have to cope with the loss of clients for the long term.

“I think there will be the need to resolve challenges in business interruption in relation to pandemics and related risks,” Booth told Insurance Business Australia. “There will also be a loss of clients who are not able to continue in business because of border closures, lockdowns and the like.

“Fortunately, Australia does not appear to have suffered greatly in this regard in the past 12 months, thanks to government support programs.”

Booth said another long-term change will be increased flexibility in working arrangements. He said he expects things to get back to normal in offices when a majority of the population has been vaccinated against COVID-19.

The National Insurance Brokers’ Association (NIBA) is the country’s peak industry body and represents around 450 member firms and 15,000 individual brokers. Booth said that NIBA sent its staff home on March 19 when there was a COVID-19 scare in its building which later turned out to be false. He said everybody in NIBA worked from home after that.

“I am very proud of everything our association has been able to achieve in 2020,” he said. “We maintained all our representation work and continued advocating on behalf of our members. We continued with our publications and also held a virtual convention which was mostly successful.

“The brokers, for much for the calendar year 2020, were working from home, and they, like many people in our society, faced challenging work conditions. Insurance brokers did a phenomenal job looking after their clients and their insurance needs.

“Many smaller brokers in the suburbs and regional areas were able to return to the office quickly because it was easy to do it, but some of the larger insurance firms had strict rules relating to return to the offices. Work will change, depending on how the community learns to live with the COVID virus, and also depending on the ongoing directions from health authorities.”

Charter Group general insurance director Glenn Noble said many of his clients, while being uncertain of their future, still needed insurance.

Noble said his small Western Sydney firm managed to hold its own during the pandemic. The Blacktown-based company director said there was no downturn in business, but the team had to spend more time with clients who needed their insurance coverage changed to reflect the new challenges.

“As a small suburban brokerage, we experienced minimal impact as the majority of clients still required insurance – property or physical risk, etc.,” Noble said. “We handle a bit of everything being a suburban firm and it impacted businesses depending on what they were in. “Cafes, for example, were badly affected while firms with trucks also had less business so we worked with them.

“More people wanted to check what cover they had and most clients were reasonable about it; on the whole, they were not unrealistic.”

Noble spoke of how clients changed the way they operated to survive.

“Some businesses adapted well, like one client who used to do these pop-up bars at events,” he said. “When the industry got decimated due to the pandemic, they began to run online classes here and in America. They also packed cocktail boxes for virtual conferences.

“I don’t see any long-term impact of COVID-19 on our business, and we are thankful for being in that situation. I am optimistic for the future though certain industries have been hit hard.”

Noble said none of their staff worked from home during the worst of the pandemic, though their contractors stayed home.

“Staff basically worked in the office because we had the room and space per person,” he said.