Custodian of the Defense Line

With the recent finalization of the federal government’s proposed financial services reform legislation packaged under Bill-38 — set to be tabled before parliament in the fall — independent property and casualty insurance brokers have heaved a collective sigh of relief that the long fought battle to prevent banks from retailing insurance products through branches appears to have been won. However, with fears that an early federal election call may disrupt the passing of the legislation, Kevin Umlah, incoming president of the Insurance Brokers Association of Canada, says brokers can ill afford at this crucial point to turn their backs on the bank issue.

With a mariner’s eye tracking for a buildup of stormy weather on the horizon, Kevin Umlah, president of the Insurance Brokers Association of Canada (IBAC) for the 2000/1 term, is cautious of claiming an outright victory for the independent broker movement on the bank issue — at least just yet.

Breaking out the champagne at this particular stage is definitely not what IBAC plans on doing, he comments, with further “monitoring” of the political processes that may affect the passing of Bill-38 likely to be the association’s first priority in the months ahead. Umlah will take over the presidency of IBAC at the association’s AGM to take place in Fredericton between September 14th and 16th.

A major concern to IBAC and many within the insurance industry is a possible delay in the passing of the proposed federal financial services legislation from its tabling before parliament this coming fall. An early announcement on a federal election could do just that, resulting in the proposed legislative package being subject to further review before going before parliament at a future sitting. And, besides the possibility of a new government taking office with its own political allegiances, the passing of the proposed legislation would be worried by lengthy delays resulting from the political review processes involved — thereby opening the door for the banks to present an eleventh-hour counter-argument.

IBAC, under the leadership of past presidents Michael Toole and Jim Ball, played a key role in successfully lobbying the cause of the independent broker movement in Ottawa whilst the government was consulting views on development of its future financial services legislation. The success achieved by IBAC against the “behind the scenes” powerful lobby pull of the banks during this period stands testimony to the strength of the independent broker movement. As such, it is understandable why Umlah, who will be taking over the reins of IBAC at the critical point when the proposed legislation is set to go forward for parliamentary approval, is not keen to let his guard down. Continuing with determination the campaign launched by his presidential predecessors is exactly what Umlah intends to do — until the legislation hits the final print. “My first concern is monitoring the [progress] of the legislation. It’s a time consuming and expensive process,” Umlah observes.

The other major factor facing IBAC in the months ahead, Umlah notes, is finding a suitable replacement for Mabel Sansom, who will be leaving the association as executive director. Sansom has over the years played a critical role in shaping the association’s public position and carrying out the board’s policy actions. Mabel will be hard to replace, Umlah adds, although filling the role will be of utmost importance as IBAC moves ahead. In addition, Umlah has several defined issues he plans to focus on as president of IBAC, but concedes that his “personal management approach” will to some extent be dependent on the successful candidate filling the executive director’s role.

Issues on the table

The impact of consolidation and modernization within the broker community have definitely been factors influencing the future direction IBAC and its sister provincial associations are taking, Umlah says. However, the decline of member firms has had more of an influence on the provincial broker associations who in turn have been limited in their contribution to the national drive.

There is no “quick fix” solution to the contraction taking place in the market, Umlah notes, but as a representative body, IBAC has to ensure that its focus remains true to member expectations. In so doing, the foremost issue is to remember that the broker profession is driven by its independence, that each firm has the right to develop and grow its business accordingly. Essentially, Umlah says, it is not up to IBAC to drive the direction of the profession, but rather to adapt to the changing needs of the members as the business evolves. In that respect, IBAC has engaged several projects on a path which it believes will serve the future needs of members. At the top of the list, IBAC has established an internal committee to examine the role currently played by the association, and how it can best serve its supporters. This investigation includes determining the most effective location for the IBAC offices. A final recommendation report is expected back from the committee shortly, Umlah confirms. Other items on IBAC’s agenda for the year ahead include a working committee on technology development, professional educational development, and ongoing branding of the independent broker movement under the bipper program.

Technology drive

One of the more significant areas IBAC is likely to become involved in is participating in the development direction of industry technology, Umlah says. Almost a year and a half ago, the association established a technology committee (which at the time was headed by Umlah) to investigate the impact of industry technology on the independent broker movement. This year, IBAC began collaborating with the U.S. Agents Council in their own investigations in technology development. “Technology touches brokerage life in every way these days,” comments Umlah, “I initiated a project committee 18 months ago and will push for further progress in the year ahead — it’s definitely an important factor influencing brokers nationwide”.

Technology development is not a “once off” project either, Umlah observes, “it’s more of an evolution,” and IBAC has a responsibility to ensure that the broker profession remains abreast of developments. In addition to the work underway with the Agents Council, IBAC is participating in industry technology work groups such as the Centre for Study of Insurance Operations (CSIO).

Professional Development

Ongoing education and ensuring professional standards within the brokerage community have always been high priorities on IBAC’s agenda, Umlah states. The association has brought about several educational courses and business management studies over recent years, he notes. However, IBAC’s work in this area has to accommodate broker associations across the country, and its role therefore is more one of providing advice to provincial members. “We don’t have any new [educational] courses lined up immediately, but we are investigating several possibilities,” he says.

Bipper branding

“Use of the bipper is at an all-time high,” Umlah comments, “but I won’t say it’s where we ultimately want it to be”. He points out that developing support for the program, faced with the diversity of the broker community, is a slow moving process — however, it is one which appears to be delivering results based on advertising research. “There has been a lot of positive feedback on the television advertising campaigns, the process of branding the independent broker movement seems to be working,” Umlah says.

The latest television ad campaign concluded at the end of June, Umlah notes, and the market research results should be in shortly. The outcome of this tracking will decide whether the association will develop a new ad campaign for the year ahead, he adds. The growing success of the bipper program has also encouraged increased support from insurers, Umlah says, “the majority of insurers are now on line with the program”.

Personal qualifications

Umlah began his career in the insurance industry 27 years ago as an independent adjuster with Adjusters & Appraisers, Brouwer & Co. Toward the end of the 1970s, he joined Zurich Insurance in a marketing role, during which time he obtained an associateship designation from the Insurance Institute of Canada in 1978. In July of 1979 he went on to join brokerage firm Hardy Freeman & Thomson Ltd., initially as a producer and then a junior partner. In the mid-1980s, Umlah went on to form his own brokerage, K.N. Umlah Insurance Agency Ltd. based in Halifax. In addition to the various functions he has filled at IBAC, Umlah is a past president of the Insurance Brokers Association of Nova Scotia (IBANS).

How will shifting into the driving seat of IBAC affect his personal and business life? Umlah does not believe the position will add any significant pressure to the duties he already carried out under IBAC. However, he concedes, the role of president of IBAC is very much a diplomatic function, the result of which will likely require greater travel. “There is a fair amount of travel involved, however, I’m fortunate in having a strong management team back at the office [of Umlah Insurance], so it will be business as usual.” One member of the “strong management team” at the busy Halifax agency is Umlah’s wife, Sharon, who is fully supportive of his commitment to IBAC.