The Insurance Market Continues to Show Itself to be Anti-Competitive
In January we wrote an article entitled How The Insurance Industry Hides and Protects Their Bottom Line — Disrupt How the Game is Played and Take Back Control article here .
We submitted it to CFO Magazine and they published it with their own edits, sharpening the focus and changing the title! CFO article here It’s all good; they have their own way of communicating, and they know what interests their readers — CFOs — so we’re all in favor. CFO did sharpen the focus on one area, the anti-competitive nature of the market with their subtitle: The insurance industry is fundamentally anticompetitive despite having a huge number of competitors, a risk management consultant says.
Not a month later, in the course of our work for a client, a broker steps up, right on cue, to offer a beautiful illustration of the point.
We have an incumbent broker on the client who is doing a good job. Nevertheless, we want to periodically approach the market via other brokers to generate a competitive process by which we will obtain lowest cost and best terms. The client CFO put me in touch with a broker he knows and likes for the purpose of obtaining quotes for the upcoming renewal. Here’s that broker’s reaction:
“Frank: Thank you for letting me know of the process you want to advocate for the procurement of the Executive and Professional lines for [CLIENT]. Further, thank you for the opportunity, but we will decline. We strongly believe that [CLIENT] would be better served by having one insurance broker approaching the entire market on [CLIENT’S] behalf. Once again, thank you for your consideration.”
I’ll translate, though that might be superfluous for savvy readers:
“Frank: I prefer to maneuver myself into positions where I have no competition, while convincing you it is for your client’s own good.”
Feb 18, 2018