Thursday, 10 March 2011
German brokers unhappy with insurers, survey says
German brokers are unhappy with insurance companies and in particular with their non-transparent claims handling procedures and the way in which they deal with basic enquiries, according to a survey by Berlin-based professional platform Deutsche Versicherungsbörse.
In particular the survey considered how satisfied brokers are when dealing with insurers by telephone. Its results do not make good reading for suppliers, experts say.
The survey finds that brokers are most aggrieved that many of their calls end up in call centres where poorly trained agents are unable to deal with their requests. “Often the call centre staff cannot help the broker and have to forward the request to a specialist department,” director of Deutsche Versicherungsbörse, Friedel Rohde, said. “As the responsible staff members in these departments change quite frequently and have to familiarise themselves with the problem, a lot of time is lost.”
Brokers are also frequently placed in long queues in order to reach a contact person at the call centres, Mr Rohde reports. “Respondents want the personal contact back again,” he said.
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According to Peter Wesselhöft from broker Gobert, Gossler and Wolters this phenomenon is a result of pressure on insurance companies to save costs. “And insurers increasingly use standardised policies in order to simplify claims handling and reduce costs,” he said.
This turns out to have serious consequences in handling claims, when clients need quick servicing. In this area insurers’ extreme thrift has had major negative consequences.
“Because call centre staff are badly trained and often work with standardised insurance policies we often see faulty claims assessment decisions,” Mr Wesselhöft said. “In addition, insurers are very fussy about interpreting conditions and are less and less prepared to be accommodating.”
Kim-André Vives from broker Südvers notes that insurers spend much more time analysing claims and refuse payment much more often than they did 10 years ago. “In particular, for basic losses in motor and marine cover, insurers need more time for claims settlement due to reductions in staff,” he said. “We have to keep reminding insurers to handle our inquiries.”
Another problem is the long time insurers need to issue policies, he explains. “In some cases, we still have not received insurance policies taken out at the beginning of 2011,” Mr Vives said.
And brokers also feel that they often get unsuitable insurance cover for their clients. “Smaller companies do not get tailor-made insurance policies but have to be content with standardised products,” Mr Wesselhöft said.
Many risk managers believe that insurers are not innovative. It is difficult for companies to buy cover for business interruption unless there is damage to property, as highlighted by the disruptions to air traffic caused by Iceland’s volcano Eyjafjallajökull. Although Allianz and Zurich developed special cover for such scenarios companies do not buy them because they are too expensive.
Cost pressure on insurance companies is increasing following low premium rates for many years now. Competition remains tough however. New players like Japan-based Mitsui Sumimoto want to conquer the market and smaller insurers want to increase their capacities.
“Not only call centres but individual contact persons are also difficult to reach by phone,” Mr Wesselhöft said. “Processes are becoming much more tedious.” For smaller brokers it is much harder today to negotiate premium adjustments or other special arrangements.
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