With a rapidly evolving insurance landscape and a relatively small market share, brokers have a tough job remaining competitive and staying on top of new trends – and it can’t be done alone.
With 34 years of experience in the insurance industry, commercial insurance broker Andrew West currently runs Hamilton-based Andrew West Insurance Brokers. According to West, one of the biggest challenges currently faced by brokers is the decreasing pool of local insurers which can create a tough job in securing the best policies. This is where business support really comes in useful.
“Having enough insurers in the local market to offer my clients the best possible terms available certainly is a challenge,” West told Insurance Business.
“In more recent times, there has been an emergence of quite a few underwriting agencies – companies like Ando, Star, Rossers and IUA, along with some others. For your day-to-day stock standard policies you’ll be OK going with the likes of QBE, Vero or NZI, but other policies might require more specialist underwriting. Working with more underwriters and being able to negotiate is really how you stay competitive.”
“That is why I joined as a member broker of the PSC Connect NZ Group,” West explained. “Through this membership, the available market and leverage is increased exponentially, and I am also able to get advice and assistance when required from PSC Connect management. You really can’t go out on your own as a broker without being a member of one of the larger broker groups - insurers just won’t want to know you.”
West says the number of brokers has substantially increased in the market over recent years while the number of insurers has substantially decreased, though the growing number of underwriting agencies has eased the pressure and helped to make securing policies somewhat easier. In particular, the market has seen a significant increase in the amount of liability and cyber-related policies; potentially a result of the increased amount of compliance and legislation facing businesses.
“In the liability space, I have seen the introduction of covers for employer & statutory liabilities, and management liability policies are now much more affordable to SMEs,” West said. “The latest new offering is very much in the cyber market. The take up has been quite slow however as, as awareness is growing, so too is the number of these policies being purchased, much like with Employers & Statutory when it was first introduced.”
“Overall, the opportunities to do very well out as a broker are definitely there,” he concluded. “You should always learn as much as you can as early as you can - some insurers hold free seminars/webinars , and IBANZ also does events/webinars which can help you get an understanding of what different insurer products are actually covering.”