A panel of five brokers will compete with each other for a range of government tenders organised in various ways, says the main driver behind the move.
Aon New Zealand, Crombie Lockwood
, Jardine Lloyd Thompson (JLT), Marsh
and Willis New Zealand were the five brokers chosen to make up a new All-of-Government (AoG) panel
which is hoped to make government spending on risk financing and insurance more efficient.
Greg Fowler is the senior commercial leader – insurance in the NZ Government Procurement team at the Ministry of Business, Innovation & Employment (MBIE) who is overseeing the complex process from a subject matter perspective.
Fowler said the selection of the five brokers involved a request for proposal (RFP) process which went out on the government electronic tender platform in tandem with engagement across the industry.
He said: “Our primary evaluation criteria was around the credentials, the capability and the expertise of each organisation responding to the RFP to be able to represent government agencies in both the local and the global insurance markets, and to be able to provide risk consulting advice that reflects the complexity of the government as a customer and the additional complexity when you combine more than one agency together.
“We had no bad responses but the agencies we chose were able to demonstrate the internal resources and the history of expertise to suggest they were capable of doing it.”
Now that the panel has been established, Fowler said some ‘meaningful discussions’ could take place around what collaborative solutions could work.
This involves bringing together government agencies with symmetries in their risk profiles, he said.
“We’re looking to build collaborations of agencies that have a similar approach to risk and risk exposures that can be pulled together to create some economies of scale but remain attractive to the insurance market,” he said.
Examples of some parts of government already in collaborative solutions would be DHBs and universities, he said.
“So sector by sector is one approach, another type of approach is looking at the type of insurable risk such as travel insurance creating an AoG travel risk solution.
“All of these are in conceptual stage so we haven’t committed to any particular type, but now that the panel has been established we can have meaningful discussions with members of the panel, as well as the agencies, to determine what clusters we should move ahead with sooner rather than later.”
As each cluster is agreed upon, they will be put to a secondary procurement stage.
“[This is where] we approach the panel on a closed tender basis so that they can contribute their versions of solutions for those agencies,” Fowler said.
Fowler was full of praise for the procurement division of MBIE which he described as centre of expertise run in a world class environment.
He said information from other jurisdictions already using an AoG approach was being sought to learn the lessons they had already learnt.
Fowler said his experience as both a consultant and a customer had also been invaluable.
“I’ve consulted to military contractors in Washington DC during the Iraqi conflict working very closely with the US government as well as working in Australia, Fiji and earning my grey hairs here in New Zealand.
“More recently I’ve become the customer in the Department of Corrections for the previous four years and coming into this project last year it has afforded me valuable insight to be both the consultant and the customer which I think is an important element.”
One of the biggest lessons he’d learned was the importance of good quality communications.
“I think the industry needs to be a very human industry for it to work. You need to be able to trust the people you’re working with so we take a very face to face approach where possible.
“Instead of sending emails we walk the pavement and go and visit the people who want to hear from us and I think that is reaping its own rewards now.”
CEO of Willis New Zealand, Peter Lowe
, told Insurance Business
he was glad to be involved on the panel having worked with numerous councils and government departments throughout the country.
“I think it’s an excellent idea what the Government is doing, it’s probably a little overdue, but I’m very pleased they’ve decided to go down this road of looking at their management of risk with a holistic approach. It’s a far more mature approach to insurance and risk management.”