Brokers across the country are facing a new year of challenges. At the office of Bellrock Broking in Sydney, Matthew Beckett (pictured above) is preparing for the year ahead.
“With the whirlwind of the final months of 2022 now behind us, I am now focusing on a strong start to 2023,” said the senior account manager. “With disclosures to insurers being key, there is a great opportunity to engage third parties to assist our clients across specialised risk management strategies, independent valuations for insurance replacement costs and extensive business interruption calculations.”
Sydney based Beckett sees natural disasters and catastrophic weather events as two of the big issues ahead.
“While clients can prepare as best as possible, property claims are almost unavoidable due to the volatile weather events,” he said.
Brokers and industry stakeholders say cyber threats have reached astronomical proportions.
“Cyber breaches – high profile breaches – have continued to make cyber a key exposure to all businesses,” said Beckett.
Last year, one of those breaches was a cyberattack on Medibank Private. Criminals stole data from up to 9.7 million customers - including names, addresses, dates of birth, Medicare numbers, policy numbers, phone numbers and some claims data.
Beckett said claims costs and underinsurance are another challenge.
“Brokers need to assist clients with current policy limits, basis of settlements and insured values,” he said.
Beckett specialises in the property sector and expects some challenges there with complex placements. He included properties in areas adversely exposed to perils, relatively poorly protected and involving high-risk activities in sectors like manufacturing, textiles and chemicals.
“In these scenarios I’ve learned the best solutions are found when we work closely and transparently with insurers and our clients to find a viable path forward for all parties,” he said.
Beckett said he’s looking forward to the new products insurers launch this year.
“With capacity returning to the market in 2023 it will be interesting to explore the innovative and customized products that may emerge,” he said.
Beckett said his own firm expects to expand too. “I am gearing up for a big year ahead,” he said.
In an earlier interview with Insurance Business, Prue Monument, from the Australian Financial Complaints Authority (AFCA), detailed what she considered as this year’s industry challenges.
Read more: AFCA on insurers' 2023 compliance challenges
Monument, who is general manager of Code Compliance and Monitoring for the General Insurance Code Governance Committee (GICGC), said one big issue is that regulators no longer see natural disasters as out of the ordinary.
“Catastrophes should no longer be catching insurers by surprise,” she said. “If this is the new normal, insurers need to adjust accordingly.”
Monument detailed other challenges in 2023 including the tail-end of COVID-19, the tight labour market and the geopolitical instability creating supply chain issues.
“All of those things are such a challenge but ASIC, and also the Code Committee, is really urging insurers to be proactive and think about how they need to position themselves to deal with this,” she said.
Monument said “the big issue” over the next year from a compliance perspective is - as in previous years – around timeliness and communication.
“That’s more of an immediate operational challenge that insurers need to deal with,” she said. “We know that insurers are struggling to meet their timeframes but what’s happening is poor communication is just exacerbating things and consumers are understandably complaining.”
