The survey suggests that some businesses are left unnecessarily exposed as a consequence of failing to have clear, engaging conversations with their insurance broker.
“The strong theme to come out of several pieces of recent research is that businesses should have clearer expectations of the services they receive from their broker,” said Andrew Gordon, Aon Risk Solutions, head of marketing, which conducted the research.
“And extracting the value they want means both sides should be investing more time in their commercial relationship.”
This research was based on a survey of 100 businesses with turnovers between $15 million and $100 million, along with qualitative research into the relationship between business and brokers and how they interact.
The survey showed some concerning deficiencies in the way businesses seek information about their insurance needs, with recommendations from colleagues (50%) ranking highest.
Sounder forms of information, such as from industry associations and broker recommendation, lagged well behind at 34% and 33% respectively.
“This is a worry given that more than two-thirds (71%) of businesses rate their insurance needs as complex,” he said.
“It’s frankly unlikely that consulting with colleagues is going to provide the information a business needs to get the right type and level of insurance.”
According to Mr Gordon, typically businesses are underinsured to the tune of 25% to 45%.
And reliance on incorrect advice, false assumptions, faulty self-assessment and incorrect valuations all contribute to this situation. The hotels / pub sector is one in particular that experiences this risk.
