RMIA chief on how to succeed in the broker 'beauty parade'

RMIA chief on how to succeed in the broker 'beauty parade' | Insurance Business

RMIA chief on how to succeed in the broker

A veteran of the insurance business, Scott Ryrie was a natural choice when the Risk Management Institute of Australasia (RMIA) chose its new CEO in 2017. With decades of experience in the Australian and Asian markets, he assumed the top job at the institution after serving as commercial director at A.M. Best Asia-Pacific in Singapore. As a former reinsurance specialist himself, he is well versed on what is expected of the profession when it comes to crafting a risk management program. In his opinion, it’s a partnership that has evolved a great deal since he first broke into the insurance business.

“The relationship between risk manager and broker has become a lot more technical, because there are more technical issues for risk assessment now,” he says. “When I was a broker in the 1980s there wasn’t a lot of modeling, so there have been a lot of changes in that regard.”

During his career, Ryrie has worked for some of the insurance industry’s biggest names, including Munich Re, Aon, Allianz, XL and Guy Carpenter. That entails dealing with some pretty big accounts where expectations are high regarding a bespoke risk management strategy. It also means consistently keeping clients in the loop regarding any development that may affect their coverage.

“For big accounts, contact is probably daily,” says Ryrie. “A listed firm on the ASX 100 would be pretty demanding, so there would be constant contact. It is a yearly cycle on coverage, but outside that, things change. Losses occur, so there is constant maintenance of the relationship and the requirement for insurance.”

For larger companies, it’s also commonplace to have contact with the insurance providers themselves. Rather than going over the broker’s head, it’s something encouraged by the brokers themselves to ensure transparency. Effective communication by all the concerned parties is what distinguishes a solid risk management strategy, explains Ryrie.

The risk coverage requirements of the buyers often don’t mesh with the sometimes siloed insurance product offerings. The brokers role is to ensure the coverage is as complete as possible and this is often a complex task for the larger corporate entities. Risk managers often complain about the lack of complete coverage and the insurers are seeking more business, says Ryrie. The conclusion is that the insurance business can grow if the product offering expands.

“Most contact is through the broker, but often these days the insurer will have direct contact as well,” he says. “It’s wise to get the two sides together, because it furthers the insurer’s understanding of the company that they are insuring. It’s a triangle and the broker would encourage interaction more these days.”

For a risk manager, working with a broker means a lot of back and forth. As a result, strong professional bonds are often formed. As someone who has performed both roles, Ryrie understands the challenges of building and maintaining those relationships. It’s a competitive business, and there are usually a variety of different brokerages that vie for the larger accounts. So, if a firm isn’t completely satisfied with the service, changing direction is always an option.

“Often, other brokers will approach clients independently to try and get their foot in the door of the business,” says Ryrie. “Those brokers are not bound by the structure of the program, therefore they will often poke holes in the existing arrangement.”

This often leads to a “beauty parade” where brokers present their best ideas on structures and costs. The larger the company, the greater the competition will be among brokerages. This is emphasized when the entity is a state-run enterprise, as Ryrie outlines.

“If the company is a government entity, there will be quite onerous procurement rules and processes to go through,” he says. “There will be a committee, there will be presentations, there will be votes, and it’s got to be done correctly.”

Correctly, when it comes to the broker, means not only providing complex plans, but doing so in a timely fashion. When you are talking about multi-million dollar accounts, the stakes are high and premier service is expected.

“It’s about responsiveness, being proactive and servicing claims and accounts,” he says. “It’s everything executed correctly and on time – service standards need to be met, if not exceeded.”