Starting out as an insurance broker is hard. Competition is tough, the market is vast and gathering client support as a newbie can be tricky.
Insurance Business spoke to Ruth Steele, business manager at TSI Brokers and vice president of the Insurance Brokers Association of New Zealand (IBANZ), about the most common pitfalls new brokers face, how to differentiate yourself from a sea of competition and where to look for crucial industry support.
“In this industry, everything is about detail,” said Steele. “Attention to detail can make the difference between a customer getting a claim paid or not, and you really need to be connecting with your clients and not taking them for granted.
“Knowing your target market and having a specialty is also very important. You should be able to target those clients that not everyone is going to get – there are many insurance brokers in the market and there is a lot of competition for clients, so having a certain specialism is a great way of standing out from the crowd.”
“One of the common pitfalls of a broker who’s starting out is that they over-service,” Steel explained. “They’ll do far too much for the client as opposed to simply offering a good level of service, and that can become quite time consuming. When thinking about client retention, you just have to make sure that your service is of a top standard so that they keep coming back.”
These groups can support brokers by getting them access to better deals and broader policy wordings, providing networking opportunities and offering internal education and training.
“Most brokerages in New Zealand are part of a cluster group, and the minority that aren’t are usually members of IBANZ,” said Steele. “TSI Brokers is part of Steadfast, and through them we have people who look at our policies and see how we can negotiate with insurers to get better cover for our clients. It also opens up a market of underwriting agencies outside New Zealand that you can deal with if you have a particular specialty that isn’t covered here, whether that’s a specific complicated risk or a type of asset that isn’t insurable in New Zealand.
“Brokers also need to accumulate a certain amount of CPD points every year, and cluster groups provide education and training plus two or three roadshows a year,” Steele continued. “They use these to update brokers on technologies, software and triage, which is a claims facility you can go to if you’re having trouble with an insurer who’s declining a claim and you need some specialty help.
“Some insurers can also often provide higher commission rates to brokers who are part of a certain group. There’s a lot of support available, and having that on hand is very valuable.”