According to John Sims, who heads Chubb’s European Personal Lines unit, large swathes of the British public are falling victim to what he calls “insurance apathy disease.”
Speaking at the Private Wealth 2003 conference in London last week, Sims noted that many high net worth clients are experiencing a general disillusionment with the insurance industry. This increasingly leads them to either self-insure or to place their business with a general or direct insurer rather than approaching a specialist underwriter, who would be better placed to help.
According to Sims this general apathy is the result of the public’s perception of the U.K.’s insurance industry as “a grey world populated by undifferentiated products and poor service.”
Sims, who has 25 years of experience as a broker and underwriter, cited four main signs of insurance apathy as follows:
— accidents and problems won’t happen to me
— all insurers are the same – therefore consumers choose the cheapest price
— using a specialist insurer will cost more
— using a specialist insurer requires greater effort
“The perception is that insurers are not differentiated enough and the products are viewed just as commodities,” he continued. As a result “customers tend to buy on price and don’t investigate the full range of services and products available.”
Making a plug for his company, Sims concluded: “There is a cure for insurance apathy among the high net worth – but only specialist insurers like Chubb can provide it. Specialist policies can be tailored to the needs of the affluent. In addition, specialist policies can be constructed so that it is the risk that’s underwritten, not the claim, thus ensuring that claims are always met.
“There is a belief that specialist insurance like Chubb’s can be more expensive – and to a certain extent that’s true. But with it comes additional added value services like appraisers who can accurately estimate the rebuild cost of a home. However, the additional costs are usually far less than expected.”
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