The evolution of the commercial broker

Commercial insurance brokers will move beyond their sales role in the future and become true advisors on risk, industry executives predict.

Signs of a hardening commercial insurance market provide one impetus for brokers to turn to risk advice to add value to clients. As commercial insurance premiums in certain lines increase, and as some coverages are more difficult to find, clients are looking to brokers to suggest alternatives to transferring risk to an insurance policy.

“The value-add that brokers can bring to insurance — and the reason why there are brokers – is that they are supposed to be the risk advisors for the clients,” said Marc Lipman, chief operating officer of AIG Insurance Company of Canada. “They are supposed to be the experts, the ones with deep subject-matter knowledge who can really coach their clients and present them with options that they might not even know existed, and help navigate them to the correct landing point, which is: ‘What kind of insurance do you need to buy, how much,’ and so on.”

“Who better than those at the point of sale…to counsel and advise their clients on changes [to risk], and ultimately to embed some of these risk management tools and services into their value proposition?” Lorie Phair, managing director of the Canadian Broker Network, commented during a panel discussion about innovation at the Insurance-Canada.ca Executive Forum Tuesday in Toronto.

“Perhaps we could almost say that the role of the broker is moving from a traditional salesperson to that of a true risk advisor. I think this is a brokerage’s chance to dance, so to speak, as we shift away from a sales role.”

Phair encouraged brokers to think about ways in which technology can help them bring added value to their clients. That means doing more than just introducing digital solutions for improving the customer experience, both at point of sale and during the life cycle of the policy. It also means using tech in a way that allows brokers to help monitor and mitigate risk.

Among the examples Phair cited is a brokerage called Player’s Health. Tyrre Burks, founder and CEO of Player’s Health, told the conference that he started his organization to help reduce the risk of youth being injured or sexually abused while playing in organized sports leagues.

Among Player’s Health’s offerings, the organization has an interactive mobile platform designed to allow coaches to quickly and easily document any injury that occurs during practice or games. This promotes real-time communication between coaches and parents to best care for the health and wellbeing of the athlete. There is also a “safety needs assessment” to show if a school has adopted sport safety best practices.

Burks, whose sports career included a stint as a receiver in the Canadian Football League, never once in his presentation mentioned that Player’s Health was a brokerage, a fact that Phair noted in her presentation later in the day. “It’s a brokerage that is using a risk-management-first technique to provide a fulsome solution to the sports and recreation niche,” she said. “Risk management first, insurance second.”

David Gambrill