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Smaller brokers excel at service: study

Focus on risk management puts spotlight on day-to-day coverage and claims.

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Smaller brokerage firms can fine tune their focus on clients, and day-to-day functions like claims and coverage, analysts at Greenwich Associates found after surveying large U.S. companies about their insurance needs and partners. Although large firms dominate the market, they lagged behind smaller ones on several service categories, including claims coordination and customer service.

Those with less than 10% of the market were the ones who earned the highest satisfaction ratings, receiving “excellent” ratings from at least half of their clients, the survey found. None of the major brokers earned an “excellent” rating from even 40% of their clients, David Fox, a Greenwich Associates consultant, notes in the report.

Corporate risk managers rated smaller brokers 50% more effective than large brokers in handling claims.

“Even if the overall capabilities of these firms fall short of those offered by the major nationals, corporate risk managers say the smaller firms are able to marshal the resources needed to meet their needs because their organizations are built on client-centric models,” Fox says.

Focus on risk management

He points out that the current emphasis on risk management likely influences the results, making individual risk managers more attuned to service.

“They are looking for a better balance between macro-level advisory services and international capabilities on the one hand, and high-quality, client-focused service on day-to-day coverage and claims on the other.”

The findings don’t mean that larger brokers will lose positioning. Their international capabilities and the range of advisory services can’t be matched by smaller brokers, the report points out. And, they’re taking steps to ramp up service.

“The trend is moving in the right direction, even if the firms are not where they would like to be at the moment,” Fox points out in the report.

Findings from Greenwich’s U.S. Large Corporate Insurance Survey rank Integro Insurance Brokers, Alliant Insurance Services and Arthur Gallagher and Co. as the top overall customer service providers.

Arthur Gallagher, BB&T Insurance Services, Wells Fargo Insurance and Lockton Companies were named the firm’s 2011 Broker Excellence Award Winners. Hub International Ltd. received an honourable mention.