The National Insurance Brokers Association (NIBA) has launched a major project to research and prove the true value of brokers to their clients and the community.
As the debate over broker commissions continues, NIBA’s board has tasked Deloitte Access Economics with preparing a report on “the role and value of insurance intermediaries in Australia”.
The Hayne royal commission’s final report recommended a review of general insurance commissions, and both the coalition government and Labor opposition have agreed to carry this out.
NIBA CEO Dallas Booth says brokers have “a sound basis” for arguing for the continuation of commissions, but believes more work needs to be done to prove the case.
“We need to have a stronger case supported by hard evidence of the value insurance brokers provide to clients, insurers and the community.”
Mr Booth told insuranceNEWS.com.au the work is too important to be rushed, and will take up to a year to complete.
“We believe there is strong value there and brokers are entitled to be remunerated,” he said. “Some people think brokers are just salespeople for insurance companies, but that couldn’t be further from the truth.”
NIBA says Deloitte produced a report on mortgage brokers last year, “which has been extremely valuable” for that sector.
A workshop has already been hosted by Deloitte to identify ways insurance brokers support their clients and contribute to “the efficient and competitive intermediated insurance sector”.
The workshop was attended by Mr Booth; Aon Regional Director Sydney Metro Commercial Lynette Walsh; Marsh’s Gary Okely; Austbrokers AEI MD Tim Wedlock; EBM MD Broking Ryan Cameron; Director at Gary Morton Insurance Brokers Vanessa Morton; and Network Insurance Group CEO Andrew Broughton.
“In addition to gathering the ideas and arguments, we will also need solid data on the work brokers do, and the value they offer,” Mr Booth said.
“We will be working with Deloitte to determine the indicators that will best support our arguments, and to ascertain whether the data is readily available.
“We may need to survey brokers in due course to gain better data for this purpose.”