How instant-response IT systems could make selling insurance worth brokers’ time
Insurance is a traditional cross-sell for brokers, but a recent panel discussion conducted by Deloitte explored how brokers could utilise technology to cross-sell products more effectively, like insurance, without risking their primary business.
The panel of industry leaders was asked where the greatest opportunity lay for the broker channel to evolve in three years’ time, and Macquarie executive director Frank Ganis said: “It is about service and convenience. I strongly believe the market is evolving to multiproduct financial services intermediaries that will provide access to a broad range of financial services products to their customers.”
However, Deloitte financial services partner James Hickey pointed out that traditional insurance cross-sell was less than 10% of a broker’s revenue. “When the mortgage market is hot it falls even lower. No one wants to risk their primary focus – the mortgage settlement. So, what does it take for brokers to broaden their value chain?”
Malcolm Watkins, executive director AFG, explained how brokers could use technology to provide immediate quotes on life insurance. “To cross-sell more effectively using life insurance as an example, our brokers need to be more automated and immediate.
Electronically they need to quote the cost to insure at the time of application, using a certain value with a number of built-in basic assumptions – like the value of the mortgage, etc. The quote and offer would be generated automatically and offered at the point of sale to the customer.
“The customer can accept that quote and proceed or defer it until the loan is approved. That gives them the time to think about the levels of insurance they are most comfortable with. To make that work the system needs to be automated and supported by a customer service available to answer questions and make it more personal.”
AMA finalist Cube Central in Brisbane is an example of a brokerage that has diversified into many areas, with health insurance being one of them.
“We started with home loans in 2005,” Cube Central founder Scott Beattie told MPA in an interview earlier this year. “When the GFC hit we didn’t get paid for three months, and we realised that we had to diversify, and diversify quickly. We couldn’t be solely reliant on mortgages.
“No brokerage that I’m aware of has really seemed to dabble in [health insurance] before, and we were pleasantly surprised; people were really interested in getting a quote,” Beattie said.
The panel of industry leaders was asked where the greatest opportunity lay for the broker channel to evolve in three years’ time, and Macquarie executive director Frank Ganis said: “It is about service and convenience. I strongly believe the market is evolving to multiproduct financial services intermediaries that will provide access to a broad range of financial services products to their customers.”
However, Deloitte financial services partner James Hickey pointed out that traditional insurance cross-sell was less than 10% of a broker’s revenue. “When the mortgage market is hot it falls even lower. No one wants to risk their primary focus – the mortgage settlement. So, what does it take for brokers to broaden their value chain?”
Malcolm Watkins, executive director AFG, explained how brokers could use technology to provide immediate quotes on life insurance. “To cross-sell more effectively using life insurance as an example, our brokers need to be more automated and immediate.
Electronically they need to quote the cost to insure at the time of application, using a certain value with a number of built-in basic assumptions – like the value of the mortgage, etc. The quote and offer would be generated automatically and offered at the point of sale to the customer.
“The customer can accept that quote and proceed or defer it until the loan is approved. That gives them the time to think about the levels of insurance they are most comfortable with. To make that work the system needs to be automated and supported by a customer service available to answer questions and make it more personal.”
AMA finalist Cube Central in Brisbane is an example of a brokerage that has diversified into many areas, with health insurance being one of them.
“We started with home loans in 2005,” Cube Central founder Scott Beattie told MPA in an interview earlier this year. “When the GFC hit we didn’t get paid for three months, and we realised that we had to diversify, and diversify quickly. We couldn’t be solely reliant on mortgages.
“No brokerage that I’m aware of has really seemed to dabble in [health insurance] before, and we were pleasantly surprised; people were really interested in getting a quote,” Beattie said.
