Insurer Execs on Broker Distribution
The Durham Insurance Brokers Association hosted an executive panel January 26th with a great turnout, great content and a very timely discussion. The event exemplified the true purpose of an IBAO Affiliate: community-based networks of brokers coming together to drive positive change.
Panelists included Paul Jackson, VP, Sales, Marketing & Distribution, Gore Mutual; Jason Storah, Executive VP, Broker Distribution, Aviva Canada; Josie Porto, VP, Ontario Region, Wawanesa Insurance; Karim Hirji, Senior VP, International & Ventures, Intact Insurance; and Tony Filice, VP, Ontario, Personal Insurance, RSA Canada.
ON INDUSTRY INNOVATION
The tone of the panelists’ remarks can be summarized by Porto’s comment: “The pace is changing constantly; we must remain agile.” Added Filice: “We need to be ready for disrupters… everyone is trying to build a better mousetrap.”
Asked if brokers had all the tools, could they re-obtain those consumers that had chosen other distribution channels, Hirji answered: “There is a huge mushy middle group of consumers (outside those committed to broker distribution or those who prefer self-servicing) that don’t care how they buy their insurance. They just want to be able to connect quickly, find a fair price and a good product. Can brokers win this business? Yes! But don’t kid yourself. Sticking CompuQuote on your website is not the solution.”
Jackson elaborated: “If the playing field was even, could brokers compete for this piece of the pie? Of course. But that takes a commitment on both sides to create a fair playing field. Insurers have to play too. Investment in technology is one example of this.”
Hirji’s thoughts on innovation noted the roles that experience, expertise and capital play in realistic execution of innovation: “Cloud-based technology allows even little companies to compete. This is how disruption can happen easily. But you still need capital and skill. I have yet to see these bright kids from Silicon Valley pumping water out of a basement.”
While the conversation started on the topic of millennials, Hirji pushed the audience to think more broadly. “Meeting customer needs applies to all cohorts, not just millennials.” However, he suggested that millennial customer expectations provide a space for brokers to thrive: “Advice, customized products, customized relationships and experience – these are all things brokers do well.” And things millennials want.
Asked Storah: “How do you access your customers, and what does that experience look like?” He suggested that customer experience comes down to two focuses: brand and engagement. “Aviva has taken a deliberate view on our single brand decision. It’s very cost effective to have a single brand.” He suggested that a separate brand would result in dollars divested away from brokers – in Aviva’s opinion, a poor long-term strategy for the channel.
Each panelist stated their commitment to broker distribution in Ontario. “I would suggest that brokers invest in a very different workforce,” said Storah, suggesting that data scientists, software developers and web designers are key ingredients to employee rosters of brokerages with long-term vision. Said Hirji: “80% of Intact Financial Corp’s business comes from brokers – and that means through Intact Insurance. Your success is our success.”
Jackson was asked the question of why Gore has been steadfast in their decision to be committed to broker distribution exclusively. “We want to be extremely good at the basics. Our goal is to earn more of that share of the broker market and not distract ourselves in areas where we don’t know what we’re doing.”
Filice approached the question on brokerage commission structures with optimism: “It really comes down to revenue. Revenue is available to brokers – you just need to position yourself to get it.”
AREAS OF FOCUS
Panelists were asked: if they were an insurance broker, what would their focus be?
Tony Filice (RSA)
* Pick your markets and partners carefully
* Be passionate about customer service – that’s your differentiator
* Know your customer segments, and know what makes them tick
Karim Hirji (Intact)
* Figure out your strategy (for example, a commercial lines strategy is different than a niche play)
* Brand yourselves in order to compete – this is how you’re going to get people in the door
* Focus on culture – how you interact with staff, and how your overall attitude impacts your business
Paul Jackson (Gore)
“Don’t assume that success in the future is the same as success in the past. Restructuring the foundations of your business might be necessary.” On the topic of talent: “Look for modern insurance skills.”
Josie Porto (Wawanesa)
* Have a digital presence
* Have a succession plan
* Repeat steps one and two above
Jason Storah (Aviva)
“If you’re on the management side of your brokerage, don’t be too close to the operational and administrative details of your business. Think about the customer perspective. Changing the perspective will align the value proposition you provide your customers.”
ON FUTURE DIRECTION
“Home sharing is the next big thing, and the insurance side of it needs to be developed. We’re betting on the sharing economy,” said Hirji. Said Storah: “No one knows what the future will bring, but we are all making bets. Brokers need to make bets too. Don’t hold onto what you’ve done over the past several years as your strategy.”
Jackson used the opportunity to talk about Gore’s vision as a “modern mutual” and how comparable that concept was to the peer-to-peer phenomenon. “Lemonade is just a fancy, packaged mutual insurance company. Mutual insurers haven’t done a good job of articulating how they are similar. Customers helping customers; pooled resources to help each other in the time of need – the philosophy behind a mutual is actually quite contemporary… it’s a socially purposed business. You’ll see more of that from Gore Mutual.”
We’ll end this blog with a quote from Jackson – make this your daily dose of motivation: “Make some bold moves guys! You need strategy, succession, technology and an investment plan.” We look forward to watching.