It's time for the broker distribution model to evolve - IBAO

It's time for the broker distribution model to evolve - IBAO | Insurance Business

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Brokers, technology vendors, and insurance companies in Ontario are coming together to address the issue of data connectivity at an industry strategy meeting led by the Insurance Brokers Association of Ontario (IBAO) later this month.

Data connectivity doesn’t refer to a broker’s ability to connect to Wi-Fi – rather, it’s about streamlining the ability of consumers to access their policies through all the various insurance companies via one access point: the broker. With all the apps available to consumers to access their policy data, it’s made it difficult for a broker to service their clients efficiently.

“If you’re a broker and you have a customer that you’re trying to service, you want one point of contact for them, regardless of which insurance company they have a policy through with you,” said Colin Simpson, IBAO’s CEO. “We realized there was a gap in data that the BMSs and these vendors had access to, from the insurance companies, to pass and communicate back and forth with consumers.”

The issue is an important one if the role of the broker is to retain value.

“We need to work together to see whether there’s a way that we can help the broker distribution model evolve, otherwise the insurance companies are going to have no choice other than to go direct to the consumer because if we can’t do it as an industry, as a distribution, then they will start providing their own apps and providing their own services because that’s what consumers are demanding,” explained Simpson.

The association says that participants in the ongoing feasibility study represent about 85% of the personal and commercial lines volume written through brokers in the province and a majority of vendors supporting that volume in the broker’s office. Applied Systems is one of those vendors on board with change.

“A number of the associations are highly interested in enhancing broker-carrier connectivity and we would be talking to everyone who’s interested,” said Jeff Purdy, senior vice president of international operations for Applied. “If it’s good for broker distribution, it’s good for Applied.”

The issue of data connectivity is one that came up over a year ago when the IBAO spoke to its members and asked about their priorities – technology was at the top of the list. Recognition that consumers want easier digital communication is driving this process.

“What we have to do is be able to change the workflows within a broker’s office so that communicating digitally becomes the norm,” said Simpson.

 

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