Brokers slammed in new Consumer NZ survey

Brokers slammed in new Consumer NZ survey | Insurance Business

Brokers slammed in new Consumer NZ survey

Consumer NZ’s annual insurance survey has revealed that those who bought life or general insurance from a bank or broker were significantly less likely to be satisfied than those who bought directly from an insurance company.

Sue Chetwin, chief executive of Consumer NZ, said customer satisfaction in the insurance industry wasn’t high – but banks and brokers were performing the worst.

“Just 47% who bought house insurance from a bank and 51% who bought from a broker thought they were getting good service. In comparison, 57% who bought direct from the insurer were happy with the service they received,” Chetwin said.

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The difference in satisfaction was even larger with life insurance – with only 28% of those who bought the product from a bank and 32% of those who bought from a broker rating the service they received highly. That compared with 47% who bought their cover directly from an insurance company.

Chetwin pointed out that sales incentives and commissions paid to bank staff and brokers were likely a major factor behind the difference.

“In the life insurance industry, brokers’ commissions can be as high as 200% of the customer’s premium. A broker chasing another commission to boost their income is going to do what’s best for them, not what’s best for the consumer,” she reasoned.

What do you make of these survey results? As insurance brokers, do you feel the results are wide of the mark? And what can be done to change this perception? Leave a comment below with your thoughts.