International insurance a chance to 'decommoditise' broking

International insurance a chance to 'decommoditise' broking | Insurance Business

International insurance a chance to
Insurance brokers have been encouraged by a key industry figure to look at international business as a chance to demonstrate their value, as Australia's smaller corporates and SMEs expand abroad in greater numbers.

Zurich head of international sales and distribution, Kai Dwyer, told Insurance Business advice on international insurance needs
 was one way brokers could 'decommoditise' insurance advice in the current broking market.

"A broker that looks for the right conversation with the customer and is in a position to be able to say, 'If this is how you expect your insurance to respond to your business needs, then this is what I recommend to you', is demonstrating that they understand what those needs are," Dwyer said.

"They are explaining there are different options available, and are making a recommendation on which one might work best. I think that is by definition selling value," he said.

However, Dwyer said brokers need to be sure they ask the customer the right questions at the outset, to ensure they put the right solutions in place for when things do go wrong.

Dwyer said the right questions would include thing such as claims service expectations, including if the client wants someone on the ground to look at the claim and negotiate it, or if a claim should be paid locally.

"Those questions determine what the correct solution is for insuring that business," Dwyer said.

Dwyer said the 'right' international insurance depends very much on who the broker is talking to and who the broker is, though he said the ability for an insurer to respond is 'massively dependent' on geographic footprint.

"There is also the possibility brokers might be choosing to buy insurance on a local Australian master policy only that provides non-admitted cover," Dwyer said.

"We don't necessarily have a view on whether that is the right solution or not, but what we do say is the important thing is to ask the customer about their service expectations," he said.

The good news for brokers involved in the market is that the risks companies face abroad are not necessarily any different to what they are already insuring their clients for in Australia today.

"At the end of the day, the physical risks that your assets are exposed to are no different in one country than another, other than to the extent that natural hazards intervene in a different way," Dwyer said.

"It is more about the complexities of how insurance works in that country, what the regulations are, what the tax obligations are, what the customers are for servicing an insurance contract," he said.

Australian brokers on the whole are 'very good' and understand the international insurance environment can be very complex, Dwyer said.

"In a way, brokers are sometimes dealing with known unknowns; they know that things are different, but they don't necessarily have a lot of clarity around how they are different and what the best advice is."

To read the full interview with Zurich's Kai Dwyer, pick up a copy of Insurance Business issue 3.04, out now!

  • Greg Cottrell - Insurance Professional Dinosaur 2014-09-01 3:02:28 AM
    Is this just marketing spin or a real capability, Over the past 10 years, even in the last 2 years, I have approached Zurich on numerous occasions with SME's with international risk exposures, mainly because of your advertising for your capacity to handle these risks, remember the slogan "Local Knowledge, Global Ability", or something like that. Not one of my submissions have I ever been able to get any assistance and have ended up with Underwriting Agencies. Most times you don't get any response at all from Zurich, as it ends up in the too hard basket and if you do after persistent follow ups you get that convenient cop out "it is not within our appetite". Does your BDM's, SME Managers and Coal Face Underwriters know of this so called Capability? Lets see you walk the talk, please......
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  • Anthony 2014-09-01 5:25:37 AM
    All true, however Kai does not mention the vexed question of liability and professional indemnity cover. What if the Australian business needs to set up a local subsidiary in a foreign jurisdiction. Will the likes of Zurich assist with local cover. Obviously that will depend on a number of things particularly the great difference between the Australian Insurer risk appetite vs the same Insurer's attitude to risk. The mis-match often means the timid Australian operation won't offer cover so how to access the overseas branch different risk appetitie. Particularly where overseas jurisdictions require local paper and local jurisdiction. All rather vexed questions.
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