View from the top: Arch’s Bottle on ensuring commercial e-trade propositions work for brokers

E-trade capabilities are now an integral part of the personal lines insurance offering. Whether home, motor, travel or health cover, the digital channel offers a simple, efficient, speedy way to transact business.

For commercial insurance, however, despite investment by insurers and brokers, the digital transition is still a work in progress. This more challenging integration reflects the risk complexity, but growing broker frustration with e-trade suggests there is still much work to be done.

A primary frustration is that the digital channel is often used as a mechanism for funnelling smaller sub-£5000 to £10,000 premium-level risks through the system.

The rationale is clear: such high-volume business is often viewed as lower complexity and lends itself to the multiple efficiencies of the digital process.

Yet smaller does not automatically mean less complex. A £3000 property risk can prove just as challenging as a much larger exposure.

When the risk is funnelled down the e-trade route that complexity stalls the process when it hits the standard question set. In fact, brokers frequently need to secure more data from clients and even then, the result is often referral.

We need to recognise in most cases it is not the technology that is at fault, but the way it is used.

Mike Bottle

This referral process of course is there to preserve the insurer’s risk appetite. However, we then hit the next issue which is that the opportunity to offramp to experienced underwriters to discuss the risk and find a solution either isn’t there or isn’t automatic and stalls or even halts the process.

Move up the premium and complexity level to larger risks such as fleet or commercial combined and these digital challenges are amplified.

So, what must happen to make the digital component a more integrated and effective part of the commercial insurance trading environment?

Integration

First, we need to recognise in most cases it is not the technology that is at fault, but the way it is used.

Technology is an enabler, a critical operational component that facilitates a faster, more efficient process. What often limits its performance is how insurers govern the system.

Digital infrastructure is inherently flexible – the options are vast. However, applying stringent question sets can often severely reduce broker options. It is imperative there is clarity and transparency on the insurer’s risk appetite and acceptance criteria before the broker starts down the digital route.

Further, by crafting the ‘standard’ questions more effectively, insurers can reduce referrals and boost the broker digital experience.

Bringing more data to the risk is also key. By insurers integrating third-party data into the process at the risk submission stage we can achieve a better understanding of the exposure, while reducing the information-burden on the broker rather than increasing it.

As in all developmental processes, the voice of the broker must be heard. Working with the broker to advance your digital capabilities in tandem with theirs, and aligning where possible with intentional placement strategies, is vital to achieving mutually beneficial outcomes.

Also, the insurance industry must recognise that the integration of e-trading must not come at the expense of access to the underwriter. It is not an either/or situation. Try to view the digital component as simply another way of getting the risk presentation to the underwriter.

Having empowered, experienced underwriters plugged directly into the e-trade ecosystem is essential. As a digital submission hits various triggers during the process, the option to divert to a coverage expert should be almost instantaneous, ensuring the journey to a solution can continue.

It is also important to recognise that where risks are particularly complex brokers recognise this and are willing to accept a delayed response – but within 24 hours should be the absolute limit.

Digital is core to advancing the commercial insurance market – but it is only one part. Insurers need to provide a blended experience combining the best of e-trade and underwriting expertise, while achieving the right balance between automation and interaction, in a single, seamless process.