Current Insurance Trends That Impact Financial Advisors
Over the last ten years we've seen the industry move from strong M&A motivation, to severe "hard market" underwriting, to deeply-discounted price competition. While different companies react and respond to trends at different times, the pendulum eventually swings the same for all.
What I'm most pleased with is what seems to be an emerging trend of insurance carriers using their "product" as differentiation. Instead of targeting market share or profit just by lowering rates or restricting underwriting requirements, many of the best insurance companies are investing more in "cafeteria"-style contracts where more customization of coverages is available.
The benefits of this are obvious. What your client doesn't need won't be forced on them. And what your client does need may now finally be available where it didn't exist before. The impact on you as their financial advisor is quite significant. On the one hand, it's more likely that you can play a part in getting your client the risk management protection that is needed. That's good. On the other hand, now that more options are available you'll need to keep a closer eye on the marketplace to make sure you don't miss an important opportunity. That's not so good.
Using an insurance expert as your firm's go-to specialist becomes even more important and even more advantageous as long as the expert you use is independent, has access to a large breadth of the market, and knows what they are doing.
Mechelsen, Inc. Darren McGraw, MBA, CIC mechelseninc.com
Comments