What conversations is this broker having with insurers?

What conversations is this broker having with insurers? | Insurance Business Australia

What conversations is this broker having with insurers?

“The majority of the conversations I’m having with insurers at the moment are around capacity,” said Adam Sloan (pictured above), head of sales and blended broking at Ausure. “Insurers tend to not have much capacity at the moment in this hard market.”  

Ausure is part of the Steadfast network of brokerages and one of Australia’s largest financial services companies. Sloan’s responsibilities include negotiating with insurance companies, on behalf of brokers, about new products and offerings

“Probably more than anything else, what I try to do is identify where there’s opportunity to partner with insurers to streamline the process for brokers,” he said.

Sloan said he sees brokers in the same light as other professionals, like doctors or accountants.

Read next: Legacy systems shouldn’t be an excuse for insurers

“The way the industry operates, we’ve got these highly paid, qualified experts doing a lot of unnecessary double entry and administration,” he said. “So what I’m trying to do is identify ways to streamline the process to make sure our experts are doing the job and being out there for the client versus doing double entry admin over and over again.”  

Traditionally, many brokers regard themselves as quite different industry professionals to those working at big insurers. IB asked Sloan if the relationship between these two industry professions is more “matey” than it might appear to outside observers?

“It is probably more ‘matey’ with particular insurers, like those that are nimble and eager to work with us,” he said. “But there are still quite a few that are yet to get with the times and haven’t caught up yet - they can be tricky conversations.” 

The legacy IT systems still used by some of Australia’s major insurance companies are a particular concern for Sloan.

“Legacy systems are a real bugbear of mine, I’m really not a fan,” he said. “I understand that a lot of insurers have spent millions of dollars developing these systems, but the hard part is eventually they become obsolete.”

Sloan said these old systems can make it challenging for customers to get insurance coverage and for brokers to arrange that coverage.

The Ausure broker said the role of his profession is definitely changing towards being more advice and less transaction focused.

“Yes absolutely,” said Sloan. “We take our obligations under the Code and giving customers the best experience and advice very, very seriously.”

He said one challenge is calibrating the business between those clients that require more risk advice and those that don’t.  

“There are small clients that don’t need a high level of advice and then there are others that need full site surveys, ISR policies, complex reviews every six months,” said Sloan. “It’s trying to get the balance between the high-risk clients and the clients that don’t need as much time.”

Read next: What would Heraclitus think of broker commissions? 

Adam Sloan’s father, Steve Sloan, also works at Ausure and is general manager of digital and communications. In an interview with IB, he discussed the issue of broker commissions.

“My personal opinion based on my own experience is that as risk professionals we get better client outcomes as a result of commissions and no-one in the industry should be afraid of the fees or commissions they make as a result of that,” said Steve Sloan

The government’s Quality of Advice Review is re-examining the issue of commissions across the financial services industry, including the commissions brokers receive from insurers.

Steve Sloan is a fan of the Greek philosopher Heraclitus. The Ausure general manager’s biography page has a quote from the philosopher: “The only constant in life is change.”

“It was to let the stakeholders know that everything that we take for granted today, may change tomorrow - and just to be ready for change,” he said.

Heraclitus’ words of wisdom inform Steve Sloan’s stance on commissions.

“You always have to have a pragmatic approach,” he said. “What I mean by that is the people who help the top end of town and help medium sized businesses, those businesses are used to paying their accountant a fee, they’re used to paying for those services.”

In contrast, he added, the other end of the market where entry level insurance products are the norm “it’s a bit more price sensitive and we’ve worked really hard to get that mix right,” he said.

The Quality of Advice Review is due to release a final report in December.