The value of a good insurance broker
There are a number of myths regarding the benefits of using an insurance broker. Cutting out the ‘middleman’ is often touted as being cheaper and quicker - but that is not true. The purpose of a broker is to offer personalised advice, get the best deal for you and be available to help you after the sale. Recent changes in the regulation of the financial services industry have resulted in an even more professional service from brokers. This benefits you - the consumer - as now there are a number of recourse routes available if you don’t get satisfactory service from your broker.
In this blog, we address some of the most important reasons you should work with a broker:
1. Brokers work for you
Unlike a call centre at an insurance company, a broker works for you. It is a broker’s job to offer you - their client - an expert and objective insurance assessment. They make sure you get the best cover possible based on your individual profile and requirements. While a call centre operator will be focused on selling you a generic policy, a broker will be focused on selling you the right policy.
Your broker must be a registered financial provider with the Financial Services Board (FSB) to provide broker service and offer advice. This registration can only occur if the broker is deemed fit and proper under the regulations. This accreditation protects the customer as it ensures disclosure, risk assessment and right of recourse.
2. Brokers keep abreast of the changing insurance industry
Insurance is an ever-changing and very competitive industry, with more options available to consumers every year. This makes it very confusing and difficult for people outside of the industry to keep informed and up to date. For this reason, a well-informed broker who keeps up with all the changes and complies with regulation is a valuable asset to have on your side. Brokers also always consider many factors you may not have thought of - like the increasing regulation, the effect of digitisation, the world economy, crime in South Africa and the changing weather patterns, to name a few - when they offer you or your business financial advice.
3. A broker will save you time
Most of us do not have the time to research the many different insurance policies online or to compare quotes and benefits. Your broker can assist with in-depth knowledge on the best products for you, and give you reasons for their recommendation. Aside from the time investment requirement, if you choose to do the legwork yourself you may not have the knowledge, experience and insight to distinguish between the different products in the same way as your broker would.
4. A broker will save you money
One of the main functions of a broker is to negotiate with insurers on your behalf. This saves you time and money as their knowledge, experience and relationship with the insurance companies puts them in a stronger position to get the best deal for you.
Cutting out the broker is not cheaper for the consumer - a broker’s advice, tailored to your specific needs, will save you money in the long run. Remember that regulations now mean your broker is obliged to disclose their commission and fees to you as their client.
5. A broker offers a client-focused relationship
A lot of people still prefer to have a relationship with their insurance broker who they know personally. Call centre operators are trained to tick boxes and treat you as part of a group of people with a similar income and lifestyle profile, rather than an individual. They are not able to meet with you to offer you personalised advice or an in-person relationship.
Brokers inspire and earn trust in a way that call centre operators are unable to. Consumers may also feel that their personal data is in safer hands with their broker because they know them personally and trust them.
A good broker will be there for your when you need them. Whether it is to assist with processing a claim or to advise upon every renewal, your Garrun broker is a trustworthy, long-standing friend who offers reliable advice through every step of the insurance process.