Insurers learn “art of the deal”

The struggle of insurers to compete in a fragmented marketplace was up for discussion at the CARSTAR Canada “Appreciation Day” recently in Burlington, Ontario. “It’s hard to get a share point, it’s hard to keep it,” says Jim Letwin of JANKelly Marketing. Speaking to a crowd of insurance and other business partners to the collision repair chain, Letwin says that the relationship between insurers and their supply chain is more important than ever.

With premiums on the rise, consumers are going to be doing more shopping around, partly because they do not believe insurer claims that rates are inadequate. While insurers are recognizing the need to take an industrywide approach to rate increases, claims will become even more of a factor in customer decisions. With bodyshops representing the claims experience to consumers, the insurer is, in effect, saying to the bodyshop, “Here’s my brand, guard it well.” And, he adds, insurers’ ability to choose where their customers go has been reduced in light of a recent Ontario decision which forbids insurers from in any way directing claimants to preferred shops when they arrive at collision reporting centers in Toronto.

Insurers may be looking at a host of options to deal with claims, from moving services in-house, to outsourcing, even to buying bodyshops, but the eye must always been on customer service. And insurers should be looking beyond their own industry to benchmark themselves, as customers become accustomed to a level of service provided by other industries, from banks to fast food restaurants.