Commercial insurance brokers will need to have evolved into business advisors for their SME customers by 2027 or face extinction.
The Future of Commercial Insurance Broking report analyses the present state of the UK’s SME commercial insurance broking market and looks forward ten years to how the market, and those working within it, will need to adapt and change to be both relevant and successful in 2027.
One of the key findings of the report is that the majority of SME customers see their relationship with their insurance broker as a transactional rather than an advisory one and would, in principle, be comfortable buying all or some of their insurance products online in the future. Over half also see their broker only once a year, yet 50% said they would be willing to spend more time with a well-informed risk adviser to discuss elements of their business and the risks they face.
The study also shows that 40% of account executive and account handlers at broking firms believe their jobs are at risk from artificial intelligence and technological developments. The report’s authors predict that whilst advances in artificial intelligence will automate processes that transfer information between the client and the underwriter, the value-added element of a broker’s role should come to the fore. They suggest that if insurance brokers can see artificial intelligence as a way to free themselves from mundane, time-consuming tasks, focus on work where human input makes a real difference, and embrace lifelong learning, they have a positive future.
However, the report warns of a skills gap that will affect the future of broking if left unaddressed. Currently, 81% of brokers are aware of a skills gap and the report looks at how traditional broking careers have developed and how these are evolving and the challenges facing both employers and employees. Entry to, and development within, broking as a profession will move toward brokers specialising as a way to differentiate themselves and their services.