Thursday, 8 September 2011
Content, not price, needs to be focus: Kurth
The quality of the relationship between insurance managers and insurers and the struggle to resist commoditisation in the complex industrial insurance market was a key topic of debate during yesterday’s DVS Symposium.
Dr Jürgen Kurth, CEO of AXA Corporate Solutions Germany
There is a growing fear in the German and wider European industrial insurance market that pressure on costs within all companies can persuade finance officers in particular to try and streamline the whole process by applying standard procurement strategies.
It is feared that if the finance officers are persuaded that the existing system involves too much legal cost and would benefit from greater standardisation then insurance managers and insurance itself could be increasingly marginalised.
Dr Jürgen Kurth, CEO of AXA Corporate Solutions Germany, took part in a discussion about the state of the market hosted by Jurand Honisch of Bertelsmann yesterday morning.
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Dr Kurth told Commercial Risk Europe afterwards that he certainly fears that an overly sharp focus on price and mistaken belief that legal conflicts are rising can only help fuel a belief in boardrooms that change is required.
“There is a danger that too much talk about pricing moves the discussion away from content. This is supported by some, often more recent market entrants, who frankly do not have the same level of know-how and a growth strategy to follow,” said Dr Kurth.
“Pricing is of course a main point but I would warn against efforts to reduce the whole insurance management process to that level as the content of the cover is very important. You do sometimes get the impression that if the price is cheap enough it overrides content,” continued Dr Kurth.
The insurance man also said that he had heard the claims that insurance managers increasingly find themselves dragged to the courts to sort out claims. “I do not believe that this is the case. I don’t see flesh on this bone,” he said.
Dr Kurth said that he thinks it would be better for the market to talk to each other about such matters rather than let it out into the open first as it can create a negative image that is not deserved and may persuade CFOs that insurance is not worth the hassle in the long run.
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