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2nd August 2020
CII urges action to restore trust
The Chartered Insurance Institute(CII) has revealed actions insurers can take to restore trust in the insurance profession as small and medium-sized business becoming increasingly concerned about policy exclusions.
While the UK was in lockdown to slow the spread of the coronavirus in April, the CII’s Public Trust Index surveyed 1,000 consumers and 1,000 small businesses from across the UK asking them to share whether the insurance profession was performing as they expected.
The poll showed small and medium-sized that had experienced little financial impact due to coronavirus restrictions were still focused on the same issues as before lockdown–most importantly, renewal pricing.
SMEs that had been somewhat impacted by coronavirus were concerned about how the policy had been explained to them– levels of transparency and the quality of advice they have been given.
Businesses that had been significantly impacted by coronavirus reported they wanted immediate assistance around their claim and to know that the policy was going to address their needs.
SMEs worst affected by coronavirus restrictions reported concerns around the transparency of their policy stating they wanted more “clarity of language” so they knew how and when they could make their claim.
The CII has urged the profession to take a three-pronged approach to building trust in the profession in light of the latest trust index findings:
-Find better ways to address the issue of renewal pricing. Initiatives, such as the ABI/BIBA Guiding Principles and Action Points for General Insurance Pricing have resulted in a gradual improvement SMEs perception of how insurers reward loyalty. However, renewal pricing is still SME’s biggest concern. They want more reassurance about the specific measures insurers take to ensure existing clients are treated fairly compared with new clients.
-Improve advice processes(and non-advised buying processes) to ensure clients understand both the insurable and non-insurable risks that they face, and what they can do about each one.
-Reach negotiated claims settlements wherever possible. There is still scope for firms to reach agreements with clients about the level of assistance they can give. Assistance given at an early stage will build more trust than compensation given at a later date.
Dr Matthew Connell, director of policy and public affairs for the CII, comments “Firms that are affected by coronavirus are becoming more concerned about exclusions in their own policies, especially around liability and property insurance.
If we, as a profession, don’t rise to the challenge of improving understanding among SMEs, we risk moving into a ‘forced trust’ position where they no longer trust that the policy will protect them adequately but continue to rely on it because of a lack of other alternatives.
SMEs understand the value of insurance, but they want a better conversation about how to manage risks. The way in which insurers manage the effects of the coronavirus is going to have a lasting impact on trust in the profession, especially for SMEs, who have a higher level of dependency on their protection during significant business interruption.”
CII Trends(305 articles)