BIBA 2014’s opening debate was punctuated by a moment of contrition, as panellists and audience rounded on the industry’s reputation as portrayed by the media.
In a gripping session chaired by Channel 4 news anchor Jon Snow, he admitted that ‘you cannot underestimate the ignorance of the media when it comes to insurance’, adding that BIBA itself deserved credit for playing a key role in educating journalists about the intricacies of the industry.
In a wide ranging discussion pulses raced after the opening remarks focused on issues such as why policy renewal tends to result in an increasing premium.
A trio of industry panellists; Axa Insurance’s Amanda Blanc, AJG’s Janice Deakin and Yutree Insurance’s Kevin Hancock were joined by BBC Radio 4’s Moneybox presenter Paul Lewis; the latter very much playing the pantomime villain in some fascinating tit for tat exchanges.
“I’m the cobbler with holes in his shoes,” began Mr Lewis. “I did a spot on Moneybox recently about if you let your insurance roll over… people were paying over £1000 more than they needed to. When something similar happened to me, I called my insurer and told them I could get a discount and they obliged. So my question was why wasn’t it cheaper in the first place?”
Having set the terms of debate, Jon Snow then put this premise to the panel, by asking: “Why do you loathe loyalty?”
“I take an old fashioned view on this,” said Kevin Hancock. “The job of the broking fraternity is to make sure we do look at our books of business regularly, so that they don’t just roll over. Without customers, we are dead. Before every renewal, we have a conversation with every client. We reassess what they are after; the competition is going to pick them up otherwise.
Janice Deakin continued: “Brokers are nothing without customers. Our end product isn’t something you can touch and feel very often; Only 10% make a claim and what they receive is peace of mind. The premiums of the many are meant to pay for the losses of the few. That’s all a broker is there to do whether you are an offshore oil company or a florist.”
However as Paul Lewis began to pick holes in certain industry practices, the temperature went up a notch. “An ONS stat today said that 6.4m people in the UK have never used the internet. They can’t find the best deal. The insurance industry milks the people who don’t change.”
He and Amanda Blanc then went head to head over the likelihood that Flood Re would leave many housesholders uninsurable, and he damned the idea that insurance was underwritten on a pooled basis at all, saying “the problem now is, insurance is not about risk transfer or pooling, they want individual pricing.”
Ultimately, the debate probably ended in a draw with the insurance trio doing their best to defend the industry’s practices against a combination of Jon Snow’s self-proclaimed ignorance and Paul Lewis’ consumer-champion perspective.
It was noticeable that Mr Lewis was forced to repeatedly remind the audience and Mr Snow of his favour for brokers and the role they play in advising clients over price and cover. The challenge, it seemed for the BBC consumer finance expert, was getting across his point that highlighting the industry’s failings on radio and TV was a valid method of holding insurance to account.
The winner was undoubtedly Mr Snow himself whose understanding of the issues improved noticeably throughout the course of the debate to the point that when all was said and done, he said to the audience; “and we were just getting started”.