“I think for many businesses, especially in the current environment, the insurance broker is seen as important to them as their lawyer and their accountant – I love that.”
Those were the words of Frank Risk Management co-founder and director Rene Swindley, who recently sat down with Insurance Business to talk about what it’s like being a broker these days. If his comments are anything to go by, it looks like it’s a good time to be part of the New Zealand broking sector.
“[The reforms’] implementation is in progress, but already you’re seeing increased accountability and transparency,” asserted Swindley. “I think that’s an outstanding result, and something that we have been talking about at Frank Risk Management. That’s a 15-year-old commercial insurance broking business this year.
“We started that business on the basis of transparency and disclosure – that the client should know exactly what they’re paying for, and they should know that their broker is an advocate for them and acts for them and never for the insurer. At that broking level, you’re only just seeing regulation come in now, 15 years after we pioneered that approach. So, we are really, really excited about it.”
Described as the country’s first fee-for-service full disclosure commercial insurance broker, Frank was built on a “no hidden income” business model. It was co-founded with chief executive Andrew Newman and is proud to be a purely local organisation amid a sea of international brokerages operating in New Zealand. Frank has offices in Hamilton, Auckland, Wellington, and Matamata.
Meanwhile Swindley, who also pointed to the rising level of competency in the industry, believes that the changes are “a really good thing” for the client. He added: “You’re asking people within organisations to prove their competency. I think that’s just brilliant. That’s great to see.”
The Frank director went on to highlight that now, amid difficulties, is an opportune time for brokers to really demonstrate the value they bring to the table.
“The next 12 months for brokers will be a challenging one,” he told Insurance Business, “given that their clients will be relying on them to support them through some tough times. I think we’ve got tough times to come in terms of the economy and the impact that COVID has had, and not everything in that space is insurable. In fact, very little of that risk is insurable.
“But I believe brokers, as a company’s advisor, get called upon to provide support and assistance and just help a client navigate. I feel like the next 12 months will be challenging for businesses and brokers alike, just as they navigate their way through a very difficult time.”
The brokerage boss continued: “In terms of further afield and into the future of broking, I think it’s just going to be a longer period of capacity issues. I don’t see that easing in the short term, so insurance placement will continue to be tricky.”
Swindley cited the “much more technical and drawn-out process” of risk placement, while at the same time shining a spotlight on the broker’s role to make clients find their insurance spend valuable.
He declared: “Ultimately insurance is a grudge spend at its core, and the only time the client sees value in this spend – which can be significant – is at claim time. So, it’s the broker’s job to actually show the client how useful it can be. While something doesn’t always happen, the peace of mind of having [insurance] is the important part, and the resilience that the business gets because of it is the key.
“Also, there’s still very much the enjoyment factor of working with clients and being part, I suppose you could say, of their risk team. I think for many businesses, especially in the current environment, the insurance broker is seen as important to them as their lawyer and their accountant – I love that. That hasn’t always been the case. It’s very enriching.”
