Media, insurance sector to blame for the industry’s bad rep

Media, insurance sector to blame for the industry’s bad rep

Media, insurance sector to blame for the industry’s bad rep Professor Allan Manning, industry leader and managing director of LMI Group, has criticised the media for releasing unbalanced insurance reports, and accuses the sector of being its worst enemy in a blog post published last week.

Manning said that the media focused on a handful of unlikely-to-be-insured houses beside the ocean instead of the 14,500 claims − the Insurance Council of Australia had received in the wake of storms – that are being assessed and paid.

He also noted the lack of criticism for the local authorities who permitted the development, or for the homeowners themselves.

Said Manning, news organisations focus on the bad news because this attracts readers, viewers, or listeners. With high ratings, organisations can retain or increase their rates to advertisers. This, Manning noted, is where the irony in all of these comes in.

“If you watch the commercial television channels, listen to commercial radio channels you will hear and see, they are one of the biggest advertisers used by the insurance industry.”

“So our industry gets demonised as being uncaring and horrible people whom (sic) look for ways not to pay claims by the media. To counteract this, and win back customer support for our vital service and protection, we as an industry advertise more on the very stations that damage the brand insurance in the first place!”

Manning also blames the industry for advertising their products to the same media that gives them bad press.

“As an industry, I sometimes think we are our own worst enemy. We are the pawns falling for a three card trick orchestrated by the media barons.”

Manning clarified that he doesn’t wish the media to be gagged, only that it should be fair and unbiased in its insurance reports.  

He says that that negative image of insurance demotivates people in the industry from doing their job, prevents good people from joining the industry, as well as allows decision-makers who keep putting home and business owners in risk-prone areas to avoid their responsibility.
 
3 Comments
  • Mark 14/06/2016 10:20:11 AM
    I agree 100% with Allan, the media fails to report that Insurance companies pay for the majority of claims, not the councils or the governments. They should report on the benefit of insurance and why you shouldn't under insure!
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  • Robert Cooper 14/06/2016 11:23:52 AM
    I agree also with Allan. The insurance industry is doing itself a disservice supporting media networks who thrive on the negative stories. It is the advertising dollar that dictates the revenue for the commercial media. We should be sponsoring only positive stories about successful claims and results, explaining the dangers of under insurance and the importance of having insurance and its benefits economically to the community in times of disaster and loss. Instead us Insurance Professionals are left explaining to family, friends and clients the reasons Beach front properties have not got cover for this event. Not as great a spread compared to a news media report.
    Somehow we have to get Insurance from being a grudge purchase, to a necessary and vital business decision and expense. The media should be able to be fair and reasonable in its reporting.
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  • Just an Observer 14/06/2016 1:34:57 PM
    Unfortunately this has been a problem for years! So to change the general public thinking the industry needs to take and commit to a long term program.

    One of the things that I think has contributed to the problem is the cover, service and explanation given to clients by Direct Insurers.

    Over my 40 years in the insurance industry the vast majority of "problem" claims following a natural disaster have involved clients of Direct insures.

    This is probably understandable given that most Direct Insurers sell based on price. Thus limited cover, sublimits etc. all of which have not been or poorly been explained to the policy holder at the time of purchase.

    In future I think ICA should capture claims figured split by Direct insurers and Intermediary based Insurers.

    That information would be REALLY helpful to the end clients and help them make informed decisions!
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