Whether navigating concerns around capacity, the war for great talent, or the impact of new technologies - the delegated authority (DA) market offers a cross-section of what’s happening in the wider insurance ecosystem.
RSA’s Steve Hedge (pictured left), delegated director, and John Dawe (pictured right), strategic partnerships director, offered their insights into what’s shaping the market today – and where DA partners need the most support. On the question of capacity, Hedge cited several conversations he had with clients at the recent BIBA Conference where they shared both the challenges and the opportunities they’re seeing around capacity.
“We’ve spoken with several people today who are looking to take existing or new opportunities to different insurers and are struggling to have those conversations,” he said. “But equally, there are more and more different capacity providers starting to come into the market.
“We’re seeing a lot of people now thinking of more innovative ways to use reinsurance and to have insurers fronting some of that risk specifically in the delegated authority space. From a capacity perspective, there are both challenges and opportunities in the MGA space. Meanwhile, the schemes space is a bit more buoyant at the moment as a good partner, a good scheme and a good delegated authority arrangement will always be in a good position to operate well and enjoy a strong future.”
A core opportunity he’s seeing on the schemes side is for insurance providers to do more than “the basics”, according to Dawe. The key is getting to grips with the pain points facing schemes brokers as they look to find niche markets and build a proposition that resonates with those markets. That’s a broker’s core competency and capability, he said.
“I think one of the challenges is how they can be getting more from their insurer partner,” he said. “What are the skills, experiences and capabilities that they need their insurer partners to display? What are they doing to help brokers to be even better and more relevant to their customers?”
Dawe highlighted that a good schemes broker is one who understands their niche inside out. Insurers should prize that specialist knowledge, he said, and want to explore ways to create more noise around that to help them carve out more of a market share within that niche.
That takes standing shoulder-to-shoulder with schemes brokers, in order to understand the challenges facing that sector and what brokers need to deliver for their clients.
“That’s where you can really see the power of the collective focus of an insurer and a broker,” he said. “It’s when we work together to understand and support those niche customer segments that we’re able to get under the skin of the challenges that they’re facing and build the right solutions to deliver great customer outcomes.”
Hedge highlighted that moving beyond the “basics” is not a once-and-done activity but rather an opportunity to continually engage with its DA partners to find out what they need. Taking this time to really listen to what partners require is critical.
