Whalesbook
Brokers Lead Insurance Sales
Brokers and agents are the main drivers of new motor and health insurance business, responsible for close to 80% of sales, according to a Praxis Global Alliance report. This reliance on intermediaries continues even as digital channels grow, because consumers find complex policies and claims difficult to manage alone.
Why Consumers Choose Agents
Praxis data shows that 83% of consumers find insurance products complicated. Most consumers (two-thirds) turn to agents for help choosing the right policy, and half seek help understanding different plan options. Trust, better pricing, and better service also lead customers to work with intermediaries.
Service Gaps Emerge
The report points to a notable gap between what customers expect and the service they receive. Only 35% of motor insurance buyers and 28% of health insurance buyers felt all their expectations were met during purchase and claims. This indicates issues with clear explanations and support during the claims process.
Loyalty and Customer Turnover
Customers often feel a stronger connection to their intermediaries than to the insurance companies. Around 40-50% of customers buy multiple financial products from the same agent, which helps agents sell more. Insurers face high customer churn; retail motor insurance sees 35-45% turnover, and health insurance over 25% in the first few years. Many policyholders can't even name their insurer, highlighting the agent's key role.
Key Customer Frustrations
Customers are significantly frustrated by not understanding complex policy terms. More than 50% of claimants did not receive their full claim amount. Additionally, 40% of customers experienced delays and a lack of transparency when settling claims. Many also want more engagement from insurers, with 60% expressing this need.