Throughout this time, there have certainly been challenges. When speaking with Insurance Business, Booth highlighted the near-constant stream of inquiries looking into aspects of financial services and insurance. Despite this, he said that his faith in insurance brokers to “get on with the job of looking after their clients” has never once wavered.
“The thing that makes my job a bit easier is that brokers, by and large, tend to do what’s in the best interests of their clients,” he said.
“There are, of course, legal obligations for them to act in this manner brought about as part of the FOFA reforms. However, the truth remains that in the Royal Commission’s findings, there were no examples of broker misconduct referenced, and no negative recommendations for the broking profession.”
“I’m honoured to be working for members with that culture of commitment,” Booth added.
As a representative of approximately 90% of all insurance brokers in Australia, part of NIBA’s overarching goal is to uphold this sense of professionalism among its members. This is achieved partly through measures like NIBA’s Insurance Brokers Code of Practice, which sets out the standards that clients can expect from their brokers and how they can pursue any complaints regarding potential breaches of the Code.
Another factor that contributes to the overall diligence of brokers, in Booth’s view, is the nature of policy renewals.
“It’s invariably a 12-month process, at the end of which the client gets to review not just the price, but also the service and advice provided by their broker,” he noted.
“It is very easy for a client to change broker at this point – it only takes a few short steps – yet brokers are still overwhelmingly retained by their clients. What this effectively shows is that clients are generally happy with the commitment and level of service they’re receiving, as brokers are able to justify their value.”
Another factor contributing to NIBA’s goal of professionalism is its mentoring programme, which partners younger professionals in the insurance industry with supportive role models to give them a greater understanding of the industry they work in.
“It’s something that I’m enormously proud of as NIBA CEO,” Booth stated.
“It’s made possible with the support of a number of the larger broker firms and major insurers, and though we had to defer most of the mentoring programs last year due to COVID-19 restrictions, we’re looking to resume running them at some point in the next little while.”
This desire to return to in-person events is something that many NIBA members have expressed to Booth in recent months. Though the association was able to attract an impressive 700 delegates to its virtual convention held last October, the social nature of many brokers means that they are pining to “come together in a social environment and share the camaraderie,” the CEO said.
“Virtual events certainly have their merit, as they can be accessed by everyone around the country without incurring any travel and accommodation costs, but there’s still a strong desire among our members to meet up face-to-face again,” Booth said.
“We’re monitoring travel and border restrictions and will continue to do so as the year progresses, but we are hoping to host the 2021 NIBA Convention in-person.”
Looking forward, Booth sees two main challenges facing Australian brokers in 2021: a hardening market and the implementation of reforms such as those from the Royal Commission. For NIBA, the primary difficulty will be the review of remuneration in general insurance stemming from the Commission.
“At NIBA, we will be occupied with preparing for this review, as we want to make it very clear that there are strong reasons in favour of retaining commissions in general insurance,” Booth said.
“It gives clients the benefits of the broker’s advice without having to pay an initial fee, and the broker, of course, doesn’t get paid until a policy is placed. Ultimately, we believe there are a whole range of reasons why commissions are desirable and often provide value to the broader community.
“We remain committed to professionalism. We remain committed to a strong code of practice. We remain committed to acting in the best interest of clients. That’s what brokers do.”