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Identifying the Best: How do Brokers Select Insurance Providers for their Clients?
23-Oct-17
Identifying the Best: How do Brokers Select Insurance Providers for their Clients? Insurance brokers rely heavily on a good reputation in order to attract and retain custom. Therefore, the choice of insurance policies that they offer their clients is vital to their business. Recommending comprehensive, affordable products with a trouble-free response in the event of a claim, can gain the broker a reputation of excellence. Equally, a bad customer experience for a client can be very detrimental to the broker’s own good name. A recent series of interviews by Insurance Age, Insurance Post and Insurance Hound, investigated the ways in which brokers choose insurers for their customers. The group documented their findings in a paper entitled “Broker Insight.”[i] They found that many brokers repeatedly used a small selection of insurers and examined the factors used by brokers to decide upon their selection. Quality of Experience and a Positive Claims Process Today, customer experience professionals are recognising that customers are putting experience above product and price in their purchase choices. Walker’s in-depth study about customers suggests that by the year 2020, the balance of importance will be 50% experience, 34% product and 16% price.[ii] The “Broker Insight” findings suggest that insurance brokers have anticipated these customer priorities, with most brokers stating that the quality of the insurer’s cover is the most important consideration when identifying insurance providers to recommend to clients. Brokers don’t like policies with numerous exclusions and they prefer policies that have a good breadth of cover. Brokers are extremely keen that their clients should have a positive experience in the unfortunate event of a claim. The public perception of the insurer claims process is regrettably very negative in the UK, with a recent poll by Dewberry Insurance finding that people tend to believe that only 50% of life insurance claims are paid ...

Millennial Falcons
18-Jan-17
How many Millennials does it take to change a light bulb? And are they adequately covered? Despite all the Brexit bluster, more than a 100,000 business entrepreneurs decided 2016 was the right time for a start-up – that’s 4.3% up on the previous year according to the Office of National Statistics. In years gone by, much thought, reputation and capital was required for such a venture, but not anymore, it seems. Millennials (also known as Generation Y, Generation Me, Echo Boomers, Peter Pan Generation) are the demographic cohort following Generation X. Consisting of individuals born between 1982 and 2004, this much maligned, but largely creative bunch need little more than an idea, a laptop and a coffee shop with Wi-Fi to get their new money earner underway. Some of these ‘companies’ enjoy staggering success, so how has the insurance industry reacted to a collective who pretty much does everything by the click of a mouse - especially in the field of Cyber risks where they are surely most vulnerable? For years, security professionals have been saying “you either have already been data breached or you just don’t know you have,” as they have become as inevitable as death and taxes. Again, according to the ONS, almost six million fraud and cyber-crimes were committed last year in England and Wales. Under-reporting and the speed of ‘criminal capability development’ is also an issue, all of which has prompted the National Crime Agency to call for a stronger law enforcement and business partnership going forward, as they estimate that the costs to the UK economy is billions of pounds per annum – and growing. Since the cyber threats of today are undoubtedly the insurance claims of tomorrow, traders that don’t have adequate cover in place will find out the hard way the impact an attack will have on their ability to trade. Part of the current problem is that those insurers who have made the digital leap are still ...

Computers Replacing Humans: Risky Business
10-Jan-17
It is basic human nature to mitigate the potential negative outcomes in the things we do. The first methods of spreading risk were practised by traders as far back as the 3rd millennia BC. Chinese merchants, tasked with navigating treacherous river rapids, would redistribute their wares across many vessels to limit the loss due to any single vessels capsizing. The 14th century saw for the first time distinct contracts, which allowed insurance to be separated from other kinds of investments (loans, for example), which proved to be a game changer in the maritime industry. The Great Fire of London consumed some 13,000 houses in 1655, thereby changing the matter of Property insurance from ‘one of convenience to one of necessity.’ From its inception, man used insurance to protect itself against loss. Unfortunately, the industry, or rather those who work in it, can no longer expect the same, as it seems man - or rather man’s creation, the machine – is turning against its creator. Slowly but surely, many of the GI roles once thought of as solid job options fall foul to automisation – of the top 20 currently thought to be the most vulnerable, the role of the Underwriter is currently number 5. Of course, developments in technology in any industry bring change; it’s inevitable. Change, although sometimes resisted, is for the most part positive; it improves productivity, which invariably reduces costs. But as various ‘disruptive changes’ affect the general insurance industry (e.g. the advent of driverless cars, drones and so on), insurers are increasingly using algorithms to assess risk and the costs applied to it, rather than using people. Starting this year, the Japanese insurer, Fakoku, is rolling out a plan to replace 34 Claims Handlers with IBM’s ‘Watson Explorer’. Scanning hospital records and other documents in a fraction of the time, it will enable the remaining human workers to process claims much ...

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12/03/2019
133% Increase in Compensation for Financial Clients: 133% Increase in Compensation for Financial ClientsThe Financial Conduct Authority have announced plans for the Financial Ombudsman Service to increase the amount of compensation that they can demand a firm pays to a client. It is set to more than double the limit – from the current £150,000 to £350,000 in April 2019. The FCA has recently completed a consultation on the proposals.This new amount will only apply to transactions that take place from April 2019. However, they are proposing that the amount be increased to £160,000 for claims made about business that took place prior to April 2019. In addition, both limits will increase annually in line with inflation from 2020 onwards.Why the change?There are a number of reasons that the FCA believes the changes are necessary. Many clients (which includes those with pension investments) may be set to lose far more than the £150,000 that is currently the limit if an investment goes wrong. Each year, around 2,000 complaints are upheld by the FOS that are above £150,000 in value.[i] Almost 75% of these claims are between £150,000 and £350,000. [ii] Currently, the FOS can request that companies pay the complete amount but cannot enforce any amount above the £150,000. While some companies do choose to accept the larger amount and pay what is requested, this can create a discrepancy between large companies that can afford to pay the extra and smaller companies that may not.While clients can take companies to court for the larger amount, the FCA points out that many clients may be unable to afford to pursue legal action. In addition, a complex drawn out legal process may not incentivise companies to keep standards high in their interactions with clients. They believe that an easy recourse to compensation through their service is far more compelling in terms of keeping up standards.[iii]OpportunitiesWhile this increase in the limit may initially appear concerning to financial service companies, it would be a mistake ...
12/03/2019
Cheltenham Gold Cup – Free Sweepstake: Once again, we’re running our annual Gold Cup competition. Simply, make sure you follow the Aston Charles company LinkedIn page, like the relevant status and name your preferred horse- a full list is below. The winner gets £50, 2nd place £30 and 3rd £20. If two people pick the same horse, we will draw names from a hat. For full T&C’s contact Richard Jones – 077250 41848 AL BOUM PHOTO ANIBALE FLY BALKO DES FLOS BELLSHILLBRISTOL DE MAI CLAN DES OBEAUX DEFINITLY RED DOUBLE SHUFFLE ELEGANT ESCAPE FRODON INVITATION ONLYKEMBOY MIGHT BITE MONALEE NATIVE RIVER PRESENTING PERCYROAD TO RESPECT THISTLECRACKYALA ENKI SHATTERED LOVEGood luck!!...
07/02/2019
Three Ways that Millennials will Shape Financial Services by the Year 2030: Three Ways that Millennials will Shape Financial Services by the Year 2030 Today’s young people in their 20s and early 30s are about to have the highest spending power of any generation.[i] These are the millennials; people who reached adulthood in the early 21st century and are now approaching the height of their careers, buying houses and starting families. They entered their employment in the midst of the financial crisis and are growing up in a world full of environmental, economic and social concerns. Their voice will have a strong impact on the direction in which many industries will need to move and the financial sector is no exception. In order to stay competitive in a crowded market moving towards the year 2030, financial institutions need to ask, “What do millennials really want?”1) Digitisation and Artificial IntelligenceOver the past decade, disruptive technology has ushered in huge changes in financial services, with a move to digitisation, mobile banking, online lending and personalised marketing. There is no indication that millennials will be slowing down the rate of technological advancements. Indeed, statistics show that millennials spend an average of 25 hours a week on the internet, with one in three people in this age category making at least one weekly purchase via their computer (as well as many via smartphones)[ii].Millennials are a generation that expects instant results. Recent years have seen the ability for an individual to make on online purchase in the morning and have it delivered in the evening. Speeding up processes and being convenient will be vital to appealing to the customers of 2030. In addition, clients will want to see an increasingly personalised service. Advances in AI are making this possible, with marketing and products being tailored to fit an individual, rather than grouping people together by demographics such as age, income or career. 2) Social responsibilityIt is ...
15/11/2018
Insurance – The Benefits of Chartered Status: Insurance – The Benefits of Chartered StatusInsurers and insurance brokers are battling a long-term problem in the market; that of the lack of customer trust. Recent polls suggest that a mere 53% of people trust insurers. [i] This is a worrying statistic for insurance brokers, who are doing everything they can to boost their reputations and improve their name for integrity and high standards. Now is a good time for insurance brokerages to start asking whether acquiring Chartered status for their company could be beneficial; bolstering their reputation within a sector that appears to be generally mistrusted. However, with the significant time and resources required to be eligible for Chartered status, it is reasonable for companies to ask whether there will be a substantial positive impact on the business. There are a number of ways in which Chartered status can have an impact:Business reputationA Chartered status ensures that the business and its employees are always held to the highest standards in terms of ethical practice, professional development and knowledge. This elevates the company reputation for professionalism, potentially drawing interest from clients that may otherwise have looked elsewhere.Fostering client trustA recent poll found that 66% of consumers had an expectation that brokers holding Chartered status were likely to be better qualified, more professional and to be more strictly regulated. [ii] Having a Chartered status can make customers see the company as more reliable, which is a huge advantage in a climate in which consumers are wary of trusting insurers. Employing the bestAs a specialist recruitment agency, Aston Charles finds that for an insurance brokerage, holding Chartered status can be a benefit when it comes to recruitment, as it shows prospective job applicants that the business is a reputable brand that has gone through the rigorous approval process of the Chartered Insurance Institute (CII). Individuals will know that their ...
15/08/2018
Are Mortgage Brokers Missing Out on Millions?: Are Mortgage Brokers Missing Out on Millions? Four Strategies for Winning the Custom of First Time BuyersBuying a house, particularly for the first time can be a daunting prospect. Credit checks, forms, and the huge variation of mortgage products and different lenders can be overwhelming.In spite of this, a mere 28 % of first time buyers intend to fund their house purchase using a mortgage found through a mortgage broker, with 46% intending to arrange their mortgage directly with the bank. However, at some point in the house purchase process, this attitude changes, with the percentages becoming 47% and 32% respectively.[i] In other words; the process of the house purchase makes many people realise the value of the mortgage broker over and above finding their own deal.This still, however, means that 53% of first time buyers are not using a broker, representing a market worth millions of pounds. There is plenty of opportunity here for mortgage brokers to win over first time buyers, saving these new customers huge sums in overly expensive mortgage deals in the process. The importance of a mortgage brokerThere are so many advantages in employing a mortgage broker early in the process of purchasing a property. Helping first time buyers to understand the benefits is the first step in winning their custom.· It is estimated that one third of customers do not get the cheapest mortgage available.[ii] Knowing the market well, brokers can access any new deals as they become available, as well as being able to analyse each customer’s individual circumstances and the best deal that they can get, giving clients the confidence that they are getting the most cost effective mortgage for them.· Many mortgage brokers also offer advice on the house buying process; from suggestions on paperwork, to recommendations about house surveys and insurance. This reduces the stress and worry ...
18/07/2018
Financial Planning Services: Make it to the Top Using Seven Strategic Approaches: Financial Planning Services: Make it to the Top Using Seven Strategic Approaches A recent poll suggests that a mere 8% of people choose to get professional financial advice when making important financial decisions.[i] However, the income that professional advice can generate is in some circumstances, almost 6000% of the initial cost.[ii] These statistics indicate that many people may not be aware of the benefits of financial advice. There is huge scope for marketing financial services to a sceptical generation. The UK needs financial advisors with motivation, drive and diligence to offer helpful, unbiased advice to clients. These advisors need a personable character that can win over uncertain clients who are looking to secure a worry-free future with wise pensions and investments.The financial services sector needs the best – and for financial advisors keen to optimise their performance, asking what can be done to get to the top is a key question. Here are seven of the most important things to consider when pursuing excellence within financial services.Know your target marketTo get to the top it is important to identify the prospective clients that you want to work with and learn everything you can about the concerns and issues that they may have - and how to resolve those issues. Become an expert in your client’s industry field. Be visible to them, by attending networking events, conferences and trade shows. It may be helpful to work within a niche industry (or even several niche industries) as you will be able to become expert in those fields, earning a name for yourself in your specialism.[iii] Earn your client’s trustExpecting a client to trust you with a large portfolio prior to earning their trust is unrealistic. In many cases, you will need to put in considerable effort before seeing a penny from a client. Consider this an investment and work hard to evidence your usefulness to top clients. 47% of clients chose their financial advisor because ...
18/07/2018
Can the Internet of Things Make Your Policy Holders Happier?: Can the Internet of Things Make Your Policyholders Happier?Technology has made huge advancements over recent years. One of the most life-changing may be an innovation known as the “Internet of Things” (IoT). Referring to “things” from day to day life, it can cover almost any inanimate object that can be connected to another; such as our cars, our kitchen appliances, our fitness trackers and our heating systems.In 2015, it was estimated that there were already over 15 billion connected devices. It is difficult to project how many more there will be by 2020, with industry experts suggesting anywhere between around 30 billion and 200 billion[i]. Either way, it is clear that IoT will have a huge impact on the modern world and the way we live.It is not only sectors specialising in technology that need to keep in step with the changes. In fact, almost every type of industry is affected by IoT, with the Insurance Industry, among other, seeing disruption from the technology. However, the disruption comes with lots of potential benefits. The IoT can have a great impact on the way that risks are assessed, the well-being of customers and the way that claims are handled. With careful application, this can be used to ensure that customers are happier with their insurance policies – increasing trust in their insurers and fostering brand loyalty.Assessing risk more accuratelyA number of different types of insurance can utilise IoT to give policyholders a more personalised insurance product. One example is in the use of health trackers, allowing underwriters to clearly assess the level of risk in a customer’s lifestyle when selling health insurance. The benefits of this are so huge that some companies have even started offering customers subsidised fitness trackers; on the understanding that they will reach a certain level of activity a day. This also benefits the customer because evidencing a healthier lifestyle through their fitness tracker can make them eligible for a ...
18/07/2018
Has Big Data Ushered Out the Age of Insurance Segmentation?: Has Big Data Ushered Out the Age of Insurance Segmentation?In days gone by, the insurance sector boasted a number of niche insurance agencies and brokers underwriting risks for specific demographics - such as women or young people. However, in recent years, the dawn of “Big Data” has given rise to exceptionally large sets of data, allowing companies to analyse such a vast range of different information that basic diversifying factors such as age or gender are no longer viable ways to segment the market. Underwriters are now able to build an individual risk profile that is not based on such sweeping generalisations, but rather on very specific details about lifestyle, finances, interests and habits, as well as a wide range of other factors.This new age of Big Data and the loss of traditional customer segmentation, gives lots of scope to insurance companies wanting to appeal to new and existing customers, through a number of approaches:Re-thinking segmentationIn the past, life stages have been largely predictable, with people studying, marrying, starting families, working and retiring - mostly in that order. Now these stages of life can happen in any order, or not happen at all, or some stages can happen more than once. Within these life stages, personalities, income and priorities are different, giving an almost infinite number of different variables and therefore an almost infinite number of different risk profiles.While risk and policy pricing is no longer driven by segmentation, there may be new ways to segment clients; by the way they like to receive product information; advertising likely to appeal to them; the payment methods they will want to use; the amount of paperwork they are likely to have the patience to complete and many other factors that may assist with successful marketing and advertising.A personal profileWhile access to Big Data runs the risk of companies viewing clients as mere sets of facts and figures, there is also scope for the opposite. With ...
18/07/2018
Shocking 91% Pay Gap Raises Questions about Financial Sector’s Glass Ceiling: Shocking 91% Pay Gap Raises Questions about Financial Sector’s Glass CeilingRecent pay gap records submitted by large UK corporations have revealed that for the highest earning workers within the financial sector there is a huge 91% pay gap between men and women. The discrepancy is caused by more men than women within senior roles, with the difference in the number of men vs women in these high earning positions having increased by 17% in the past six years. This indicates that the glass ceiling stopping women rising to the top within the financial sector is stronger than ever. [i]It is natural to ask, “how can this be possible in the 21st Century?”A study of the reasons why, reveal a lack of easily identifiable causes, with some articles suggesting simply that there are few women in senior finance positions because there have always been few women in senior finance positions. In other words, perhaps it is a symptom of a sector that is averse to change. However, the industry must change in order to survive; not only for the sake of a fair sector and diverse operations, but also because hiring more women in senior positions is integral to the profitability of the companies and the good of their clients.Why does it matter?Firstly, in modern society a truly diverse group of employees is not only ethically and legally demanded but is also vital to the functioning of a company. How can one expect to appeal to a diverse modern world if one does not employ diversely?Indeed, we see that the lack of women in finance has a huge impact on profit. Across 6 wealthy developed nations, a survey found that over 50% of high earning women do not have a financial advisor. In the US, 44% of the women in this bracket who do have a financial advisor, feel that their advisor does not understand them.[ii]The industry needs to change. The missed assets in the US alone from this apparent marginalisation of women may amount to a staggering 5 trillion dollars.[iii]Surely more women in ...
18/07/2018
Problem or Potential? Considering Ethical Artificial Intelligence in the Financial Sector: Problem or Potential? Considering Ethical Artificial Intelligence in the Financial SectorArtificial Intelligence is being used across multiple industries worldwide and is seeing dramatic growth. Annual investment by Venture Capitalists into US AI start-ups has seen a six-fold increase over the past 17 years.[i] The financial sector is one industry which can enjoy multiple benefits from the utilisation of AI. Statistics suggest that over the next three years, AI could decrease bank’s costs by 3.9%, while increasing revenues by 3.4%. The dawn of AI in the sector is good news for customers too, as AI can improve processes for savings, investments, risk assessments and loans; in fact, across almost all aspects of financial services. However, with the rise of AI, has come concerns about the ethics surrounding its use. Worldwide, there has been much debate about how to develop and use AI in a responsible way. The House of Lords has produced a report on the ethical use of AI, highlighting a number of principles that must be applied to the development of AI.[ii] This includes the following:The common goodThe House of Lords Select Committee highlighted the importance of all AI development being for the common good of humanity. Though AI focused on improving healthcare, education and the environment may seem to be more in line with this mandate for “good”, there is no reason that the financial sector cannot also have a thoroughly ethical framework for AI development. AI within financial services can be focused on creating systems, processes and advice that are accurate and helpful. AI can give immediate responses to queries and offer instant transactions. It can help to identify anomalies, thus potentially exposing fraud or error. Indeed, a government review identified the three areas with the most potential for AI to be in anti-money laundering and fraud detection, as well as personal financial planning.[iii] The aim should be to create an AI that helps its customers ...

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