New opportunities for brokers from changing insurance needs

Authored by Owen Thomas, Chief Sales & Marketing Officer, Premium Credit

As we recognise the anniversary of Britain’s first Covid-19 cases, it’s a time to reflect on how much has changed on both a personal and commercial level. In a broker context, the insurance needs of customers, both personal and commercial lines, have changed significantly as life has been transformed by the pandemic. New types and levels of insurance are now required providing opportunity for brokers and all of us servicing the insurance industry.

Upgrading insurance cover

The way the world operates has changed. Rarely have we seen such need to adjust – Covid-19 has been an accelerant for change. Those who have adapted well are thriving, whilst in contrast it’s seen the demise of others. As situations have changed so too has the need to adjust and upgrade insurance cover, particularly for those businesses who are experiencing significant growth right now, and there are many. A great example is travel insurance in both personal and commercial lines – not since the Iceland volcano eruption and resultant ash cloud in 2010 has there been more focus on the level of cover that customers are buying in this sector.

Booming businesses - what cover is needed?

Insurance profiles have changed by varying degrees. Businesses providing home delivery and logistic solutions have expanded to meet demand; online services have seen significant growth; and firms supplying home based businesses and leisure pursuits, have in the main thrived. These are just some of the more obvious examples where extra and wider insurance cover may be needed. A little research will uncover many more which can be added to the sales funnel.

Positive examples like this provide a business development opportunity for brokers offsetting to some extent, the insurance business lost through failing businesses during the pandemic. Brokers who seize and identify these positive growth opportunities will thrive, despite these difficult times, enabling them to secure new business with prospect and existing customers.

New cover required for those who have modified their business model

Wider insurances may be needed for expanding businesses but what about companies who have adapted in order to survive? Have your customers’ businesses been modified to withstand the economic stress of Covid-19 - what changes to insurance cover are needed?

Pubs are one example. Some locals, now closed in the traditional sense due to lockdown, have resurfaced as takeaways, green grocers and bakeries with some even being considered as venues for vaccination centres or hosting other social services. Maintaining some level of income as a stop gap solution will save some ventures. Business owners need to consider their new position and whether there is an increased or different insurance requirement?

These are just some short-term examples whereas, more long term, permanent situations are also becoming common place. Increasingly, unviable commercial properties, closed as a direct result of the pandemic, are resurfacing with a complete change of use. Shop units closing and re-emerging as apartments; hospitality; recreational or split use premises are one example.

Whatever the situation, a change of use may need increased or different insurance covers.

The opportunity

Not only do brokers have a new opportunity to sell wider cover but to potentially upgrade it too. The renewal or new business conversation will change in emphasis with the need to discuss in greater detail the business’ upcoming insurance requirements.

Wider payment options

So, we’ve discussed levels and breadth of cover, but how will the customer pay? Never before has it been more important for brokers to provide their customers with wider payment options.

Some will pay for vital insurance cover with help from a pandemic related government support package (which can’t continue long term), others will use up vital resources paying for annual protection in one large lump sum, and with increasing numbers, others will consider paying for cover through convenient monthly instalments, spreading the cost through Insurance Premium Finance (IPF).

IPF is a strong option. Those using this option will benefit from:

• Improved cash flow: IPF eliminates the requirement for a large up-front payment, freeing up the lump sum to use elsewhere and avoids the need to liquidate other assets
• Complete cover: ensuring the upfront cost doesn’t lead to cutting corners on insurance cover
• Flexibility: multiple insurance policies can be attached to a single premium finance agreement allowing for a single payment plan and single direct debit
• Retained Capital: by using the premium finance lender's capital, customers can retain and re-invest capital in their business

As well as enhancing customer payment options there is also opportunity for brokers to receive a percentage commission for every new Credit Agreement they set up for their customers choosing to pay in this way.

In summary

Despite the pandemic causing much upheaval and uncertainty to individuals and businesses everywhere, obtaining the right insurance cover, at the right time and level will provide peace of mind and increased security. Whether it’s new, modified, expanded or ongoing levels of cover needed – premium finance is a compelling payment option to offer.

If you would like to find out more about our insurance premium finance solutions, please get in touch with your Premium Credit contact or by visiting www.premiumcredit.com