A rallying cry for brokers
Suncorp Commercial Insurance CEO Anthony Day has challenged brokers to “go on the attack” in the face of technological change and greater competition.
“The opportunity is for all of us to change our business model and adapt to the rapidly changing customer of the future,” he told last week’s Steadfast Convention.
Mr Day told brokers they should capitalise on their capabilities.
“The unique relationship brokers have with customers is what all the disrupters in every industry are looking for.”
He says brokers’ ability for constant interaction with customers “not just once a year”, being trusted and having deep knowledge of clients are what the digital world is trying to achieve.
Digital disruptors such as Google and Amazon are working to identify the characteristics and needs of each customer, but brokers are ideally positioned to meet customers’ needs because they know their clients.
“In the past the focus was on products but now the focus has to be on customer interaction.”
Mr Day says demographics, technology, changing lifestyles and buying preferences are creating a more splintered range of customers.
Companies that do not cater to the preferences and behaviours of Baby Boomers and generations X and Y and soon Z “will simply become irrelevant”. He urges the industry to use the fresh thinking of its employees, including that of the four generations in the workplace.
Suncorp is training its staff how to react to customers’ different personas, and he says brokers do this naturally.
“Traditional scripts do not work. We need to customise to the individual.”
Brokers must look to their businesses and how they communicate and meet the changing needs of customers.
Mr Day returned recently from Europe and the US, where he met reinsurers and investors.
He says while insurer and reinsurer returns continue to be strong, there is concern about the global economy.
Australia’s stable economy is attracting increased capital and competition to the insurance market “and there are disruptors looking for industries and environments like ours”.
While this can deliver a short-term benefit to customers through increased capacity, it can lead to longer-term issues for competition, not only for insurers but also for brokers.
SMEs here are “doing it tough”, Mr Day said. They are becoming risk-averse and looking to protect their businesses, and that provides an opportunity.
Customers across many sectors feel the internet has empowered them, and the most recent Vero SME Insurance Index shows business owners want to have more control over their insurance decisions.
Many young entrepreneurs, particularly women, feel they can buy insurance without the help of any adviser.
“There’s no doubt the technological evolution is affecting your business,” Mr Day said. “But you need to embrace it, to become part of it.”
Brokers can increase their use of online and mobile channels, and use search engine optimisation.
Customers have access to large amounts of information but are also suffering “information overload”, particularly if they are time-poor SME business owners.
“This is your opportunity to help,” Mr Day said.
Social media should be seen as an opportunity to gain referrals and to tell potential customers that using a broker can save them money and ensure they get the right cover at the right price.
“Your knowledge and experience is the best selling tool you have. Don’t underestimate that.”
Mr Day says there will also be opportunities to innovate, and brokers are ideally positioned for this because the best innovations are based on understanding customer needs.