Why insurer oversight cannot become another regulatory box-ticking exercise

With regulatory workloads continuing to grow and the FCA maintaining its focus on customer outcomes, Insurance DataLab co-founder Matt Scott explains why brokers need a practical, evidence-led approach to insurer oversight.

For brokers, the regulatory workload is hardly getting lighter.

Alongside the day-to-day demands of running a business, firms are increasingly expected to demonstrate how they are monitoring the insurers they work with, assessing potential risks and ensuring their placement decisions continue to support good customer outcomes.

That does not necessarily mean every broker needs a formal security committee. Many smaller and mid-sized firms will have different governance structures and processes in place.

But whatever the structure, the underlying challenge is the same: how do you consistently assess the financial strength, performance and customer outcomes of the insurers you are placing business with – and, just as importantly, evidence that analysis?

That is a conversation we are looking forward to having with brokers at Broker Expo this October.

Making insurer oversight more manageable

Insurance DataLab will be at the Birmingham NEC primarily to showcase Security Committee-in-a-Box, which has been developed to help brokers introduce a more structured, independent and evidence-led approach to insurer oversight.

The service brings together a range of insurer performance data into a framework that brokers can use as part of their existing governance processes.

It covers four key areas: claims, complaints, solvency and underwriting, with each receiving a RAG-rated score out of 1,000, helping brokers identify the strongest providers across each market, as well as those partners that might need greater scrutiny.

The purpose is not to automate decisions about which insurers brokers should or should not use. Broker judgement, experience and insurer relationships remain vital. Instead, the data provides another layer of independent evidence that can challenge assumptions, highlight emerging issues and help demonstrate why decisions have been made.

That evidence is becoming particularly important as Financial Conduct Authority scrutiny remains focused on firms being able to show how their processes translate into better outcomes for customers.

A broker may have longstanding relationships with an insurer and extensive experience of placing business with them. But combining that knowledge with objective performance data can provide a much stronger basis for ongoing oversight.

Ultimately, better-informed insurer selection and monitoring should also help brokers deliver better customer outcomes by giving them greater visibility of the firms they are entrusting with their clients’ risks. These insights can also help brokers evidence and support their insurer recommendations in client reports, providing an independent data-led rationale for why a particular insurer has been selected.

We will also be using Broker Expo to share some of the findings from the latest wave of our Commercial Lines Claims Pulse survey, conducted in partnership with Research in Finance.

The research looks at brokers’ real experiences of commercial insurance claims and has reinforced the importance of claims performance not just to customer outcomes, but to broker trust and future business placement.

Visitors to our stand will be able to pick up a copy of the latest Claims Pulse report and discuss the findings with us.

Exclusive offer for Broker Expo delegates: No-obligation four week free trial

Most importantly, we want brokers to be able to see how Security Committee-in-a-Box could work within their own business rather than simply hearing us talk about it.

We will therefore be offering brokers attending Broker Expo the exclusive opportunity to take a free four-week trial of Security Committee-in-a-Box, giving them the chance to use the data and framework with their own insurer oversight processes.

We are also keen to hear how brokers currently approach insurer monitoring, where the biggest administrative burdens sit and what evidence they are increasingly being asked to provide.

If you are attending Broker Expo, come and see Insurance DataLab on stand 62 to discuss Security Committee-in-a-Box, the latest Commercial Lines Claims Pulse findings and how independent data can help make insurer oversight more effective – without simply adding another layer to the regulatory workload.

Sign up to attend the Broker Expo on 8 October at the Birmingham NEC

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