Consultative Broker Briefing

I think it is time that a voice of reason prevails upon the fear that is gripping our industry. Sure times are challenging; haven’t they always been? Let’s keep one thing in perspective: as brokers we did not create this chaos nor will we solve it. That is not our job.

To all the “Chicken Littles” out there, remember this: most of us are not qualified to become bogged down with the nuances of “systemic breakdowns” or “mortgage swap derivatives.” You need to focus on two things: 1) Serving your clients' best interests and 2) creating and retaining revenues. Period!

Of course this will entail you being nimble. By nimble I mean keenly observing the comings and goings of the next several months. But, nimbleness does not mean getting caught up in the fear and panic that some of your carriers and competitors will get swept away with.

You will see an entire group of industry insiders who will spend the foreseeable future getting caught up in prognostication, regulation reform, and selling excuses. This is an internal focus that takes your eyes away from where they should be placed . . .squarely on your clients and prospects.

Some of us have seen this before. It is not unlike the chaos that hit the London Marketplace in the early 90’s when the LMX Spiral reduced Lloyds to a smoldering pile (for those of you who aren’t familiar with the LMX Spiral, find some grey hair in your office). Did the London Marketplace go away? Did Lloyds disappear? Of course not! They simply fixed a problem.

So, as Consultative Brokers, here is what you should be doing:

Don’t take your eyes off the client/prospect. You should be aware of what is happening around you, but don’t let it distract you from your real function in the industry.
Watch for opportunity. Some of you have lost accounts due to pricing volatility of unstable markets. Some of this current turmoil will create opportunities for you to fix “security.”
Stop offering or competing with B Rated Carriers. Some of you have been victimized by prices offered from B rated carriers. You should remind every client who is currently insured with a B rated carrier of their precarious position. This isn’t college: a B rating doesn’t mean the same thing!
Continue to build a Value Proposition. A Consultative Broker understands this: Insurance is the worst investment a client can make. It is sunken money with no return (it simply puts a client back to where they started). The more effective you are in helping them reduce risk and indirect loss costs, the further they can be removed from this bad investment.

When looking at the conditions of chaos that now exists inside the financial services and insurance industry, I am reminded of an “old Scottish proverb”. It tells the tale of two gentlemen who have reached a fork in the road. One turned to the other and asked, “Which road should we take? I am sure that one road is better than the other.”

The other gentleman quietly replied, “Whichever road we take...the results will be the same. It won’t be good or bad...it will simply be where we are.