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Author: Andrew Pearce
Source: Insurance Age | 10 Aug 2012
During a week in which the Insurance Age newsdesk was largely consumed by the usual swathe of half-year financial results, one piece of broker bashing still struck a chord.
A mystery shopping exercise by the Daily Mail's sister finance title This is Money warned that brokers can lead to"wallet-busting differences" when compared to people buying their insurance directly through a price comparison website.
In fact, the article warned that buying insurance through brokers could push the price of premiums up by £500 a year. It led to Biba expressing its disappointment with the article.
Certainly, it is always easy to hit the middlemen. But the report most definitely misses the point.
Forgive me for speaking the obvious, but while many brokers may be on aggregator sites other forms of broker service are inevitably going to charge more. Their offering is entirely different to what these websites look to provide.
And all the better for it. I am hearing more and more from contacts in the industry, as well as friends about people opting for the cheapest policy online only to find out later, that due to a small clause found on page 45 of the attached internet document, they are not entitled to the claim they thought their cheap premium essentially guaranteed them.
Perhaps if they had gone directly to a broker rather than a website they may have been aware of the pitfall of the policy they were about to snap up.
And maybe this is the point. The internet-savvy generation is probably less wise about the uses and benefits of brokers than in the past. The challenge that brokers must now confront and tackle with gusto is to show the public why they should be the first port of call.
During an era of impersonal transactions across the board people are beginning to look for a more personalised, reassuring service across many areas of the UK economy and now is the time for brokers to make that count when it comes to insurance.
As noted above, Biba responded swiftly to the dose of national newspaper coverage and listed the benefits that brokers can bring to the process. More emphasis on the positive role they can play would be welcome by both the people at the coalface and this representing body.
This is ever-more crucial with a report published some weeks ago revealing that UK brokers have seen their revenues fall by an average of 3.9% every year since 2007.
They may make premiums a tad more dear, but you can't put a premium on honest, upfront, personalised service. It's time to make that count.
Richard Anthony Oakes, Sharon Linda Oakes & Ashley Burton trading as Oakes Insurance Consultants are
authorised and regulated by the Financial Services Authority. Number 307170
Registered office: Oakes House, Derby Road, Long Eaton, Nottingham NG10 1PD