How to find coverage for your customers in underserved markets

Full disclosure of a customer’s claims history (even if high), and building trust in a partnership between insurers, brokers and customers, can help move the needle on what would otherwise be characterized as tough or underserved industries, according to speakers. Thursday during a Canadian endorser webinar.

“Sometimes customers need to drink the Buckley’s,” said Philomena Comerford, president and CEO of Baird MacGregor Insurance Brokers LP and Hargraft Schofield LP. The reference is to a cough medicine with the slogan: “It tastes terrible, but it works.”

Likewise, a broker’s commercial client may object to the cost or effort required to reduce risk on his behalf, but that is what it takes to find coverage in an underserved market.

“They don’t like it that much sometimes, but it’s the only way you’ll know,” Comerford said. “You’re not taking care of the customer just by trying to cover up or hide the work on the company you’re posting….”

The same goes for relationships with industry partners, Comerford said during the CU webinar, Navigate the rapidswhich outlined best practices for historically challenging industries. Honesty is the best policy when brokers deal with insurers when assessing client risk.

“You have to show that you have a proven track record,” she advised brokers when talking to insurers about risks in an underserved industry. “And even if there’s something bad in the history of business class risk, you have to say, ‘This happened, but here’s what we did to make sure it doesn’t happen again.’

“You have to stand up for that and talk about it,” she said. “You may have gotten rid of a very problematic risk, but you have to show what the numbers look like in the end, and here’s maybe what it looks like once the surgery is done.”

Comerford used the example of a taxi risk proposal that her brokerage presented to Echelon Insurance – in the middle of the pandemic. The proposal included simulator training and inward and outward facing cameras that enable telematics in every single vehicle of a very large portfolio.

“We were so committed to making sure every driver is vetted with the exact same exercise every time,” she said.

Echelon Insurance president Robin Joshua admitted that when the taxi portfolio first came in, he wasn’t sure it would be a good fit. “My first thought was, ‘Wait a minute. I am not ready to enter the taxi industry yet,” he said during the webinar. “It has never performed well in our world, and how are you going to manage that risk?”

But after a detailed presentation, the insurer’s concerns were allayed. “They checked all the boxes: mitigating risk by submitting data that we can analyze,” Joshua said. “That track history was fantastic and even the smallest risk reduction, like having a rear-view mirror between the passenger and the front, that’s so small, but it’s such a great prevention tool.

“All those things were there.”

This kind of honest and straightforward collaboration between carriers and brokers can be game-changing in challenging industries, said Marc Lipman, president of Lloyd’s Americas. “Telematics is another way brokers and carriers are working together to help improve the risk profile and behavior of some of our shared customers.”

Credibility is a crucial part of collaboration, and both expertise and trust create credibility, Lipman said. “Trust is about a track record of working collaboratively, openly and transparently with insurers, so that no negative or unpleasant surprises arise after the insurer is ready and the risk is limited.

“Insurers don’t want to be surprised; they don’t want to question their business partners,” Lipman said. “But I don’t think that’s typically the case; I find that quite unusual.”

Feature image by iStock.com/AscentXmedia