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More businesses using a broker for their insurance

31 March 2021

More businesses using a broker for their insurance

The number of SME owners using brokers has hit 40%, according to the latest edition of the Vero SME Insurance Index.

The report surveys more than 1500 SMEs and carries out detailed interviews with business owners, and this year’s study marks its 10th anniversary.

The 40% figure represents a rise from last year’s report (35%), and Vero believes it may mark a “flight to trust” as clients increasingly look for guidance in a pandemic-altered world, with one-in-five respondents not feeling confident about their business prospects.

“This [broker use] measure can fluctuate from year to year, and there would need to be at last two consecutive years of growth to call this a trend, however, it is a positive early sign of increasing broker usage and potential reversal of the declining trend seen in previous years,” the report says.

More than half of direct buyers are also considering using a broker in future, the report finds.

The reasons direct buyers would consider a broker include saving time (24%), access to better policy wordings (21%), and increasing complexity within the business (15%).

“We could be seeing a ‘flight to trust’ as SMEs look for additional support for their insurance needs, giving brokers an opening to demonstrate their benefits as risk and insurance advisers, providing valuable guidance throughout the process,” Vero Head of Commercial Intermediaries Anthony Pagano said.

“Insurance, regardless of what people believe, is a complex contract and needs to be properly understood to ensure it reflects the business needs and associated lifestyles.

“Brokers can encourage those direct SMEs with complicated insurance needs to make the switch, by helping them feel more informed and supported end-to-end.”

Credit to www.insurancenews.com.au