Insurance Business 4.02

insurancebusinessonline.com.au Issue 4.2

BROKERS 2015

Australia’s top insurance brokers revealed SEAMLESS STRATEGY

MACQUARIE PACIFIC FUNDING’S RACHAEL LAVARS TALKS INDUSTRY CHALLENGES

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TAKING DOWN THE BARRIERS ACHIEVING TRUE GENDER DIVERSITY IN INSURANCE

PROTECTING THE HOME FRONT SAFEGUARDING THE INDUSTRY ITSELF FROM CYBER-ATTACKS

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APRIL 2015

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CONTENTS

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NEWS 06 Round-up

Taskforce to examine high premiums in Northern Australia

FEATURES

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TAKING DOWN THE BARRIERS

COVER FEATURE

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How to achieve true gender diversity in the industry

FEATURES 26 Michael Kerner

Zurich’s global CEO of general insurance talks expecting the unexpected

40 Protecting the home front

42 Adding oomph to insurance

Broker Kate Greaves on her successes

Australia’s top insurance brokers ranked and revealed FEATURES

THE BIG INTERVIEW

The impact of recent air disasters on aviation insurance

How well does the insurance industry protect itself against cyber-attacks?

ELITE BROKERS 2015

FEATURES

10 Analysis

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FORWARD THINKING

Developments in freight forwarding

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Macquarie Pacific Funding’s Rachael Lavars on her new role as CEO

BROKING INTELLIGENCE 44 Creating a customer delight culture

How to wow your customers

47 Looking out for your mates Mental illness in the workplace

50 When to involve the troops Bringing staff into decision-making

52 Stats

The Vero SME Insurance Index 2015

INSURANCE INSIDERS 54 Social life

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Brokerage CEO in Antarctica and 2015 UAC Expos PEOPLE

AUTHORISED REPS: BECOMING THE BOSS

What potential rewards come from being an AR?

56 Favourite things

GSA director of business development Nicole Mellick

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UPFRONT

EDITORIAL

Time flies by…

W

e seem to be moving towards the middle of the year at a furious pace. That perception is likely due to the abundance of activity we’ve seen in the general insurance space in recent months.

On top of the business challenges industry participants face in the current soft market, there’s been ongoing discussion since the beginning of the year around the Financial System Inquiry’s Final Report (released late last year) and precisely what it means for this space.

In late February, Cyclone Marcia rocked Central Queensland and, in March, the Insurance Council of Australia announced that the reserved value of insurance losses resulting from the disaster was $403.6m from almost 30,000 claims.

And in April, AIG announced it had received the go-ahead from the US Federal Aviation Administration to start using unmanned aerial vehicles in place of people to conduct risk and claims management inspections. Developments in drone technology will probably remain in the headlines in the insurance space for months and years to come.

Of course, it’s important to stop and take a moment to acknowledge the outstanding work of top players in the broking space. In this issue, we announce the brokers who ranked in the Top 30 in the Insurance Business 2015 Elite Brokers survey. It’s a hot contest that continues to turn up the heat, and the entire team here is grateful to everyone who took the time to enter this year’s survey.

As well as acknowledging our top entrants, Insurance Business has taken time this month to examine the challenges that prevent us from seeing true gender diversity in all corners of the industry. Many leaders associate greater diversity in business with higher levels of success. We talk to those who are leading the way in driving change on this front and some of those on hand to provide the tools to help businesses make it happen. I must extend a sincere thank you to Meg Hurley, ANZIIF’s general manager of marketing and insights, for the considerable time she spent sharing the learnings from ANZIIF’s recently conducted Women in Insurance survey. Hopefully, that survey will ignite wider discussion about women’s representation in general insurance, and prompt more employers to drive the necessary cultural and structural changes within those entities.

One woman who has succeeded in rising to the top ranks is Rachael Lavars, who became Macquarie Pacific Funding’s CEO in January. She sat down to give Insurance Business her thoughts on a number of industry issues and her priorities at Macquarie for the time ahead.

I hope you enjoy what we’ve prepared for you in our latest issue and look forward to bringing you more in our June/July edition, including a wrap-up of the Steadfast Convention.

Tim Garratt, editor, Insurance Business

www.insurancebusinessonline.com.au APRIL 2O15 EDITORIAL

SALES & MARKETING

Editor Tim Garratt

General Manager Peter Smith

Journalist Jordan Lynn

Commercial Development Manager Sophie Knight

Production Editors Roslyn Meredith, Moira Daniels, Carolin Wun

CONTRIBUTORS Karen Gately, Stefan Kazakis, Gordon Tredgold

ART & PRODUCTION Design Manager Daniel Williams Designers Joenel Salvador, Marla Morelos Traffic Coordinator Lou Gonzales

Marketing & Communications Manager Lisa Narroway

CORPORATE Chief Executive Officer Mike Shipley Chief Operating Officer George Walmsley Managing Director Justin Kennedy Chief Information Officer Colin Chan Human Resources Manager Julia Bookallil

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NEWS

ROUND-UP

Taskforce’s consultation with insurance industry will be ‘extensive’ INDUSTRY INPUT will be vital in considering options to reduce insurance costs in Northern Australia, a spokesperson for Assistant Treasurer Josh Frydenberg has told Insurance Business.

Mr Frydenberg announced on 30 March that a taskforce would be established to examine how home, contents and strata insurance premiums in the region could potentially be reduced. The spokesperson says, “The taskforce will consult extensively with industry, and will be supported by a reference panel comprising industry representatives drawn from the insurance and reinsurance sectors.”

On the subject of the taskforce’s membership, the spokesperson says details are being finalised.

The announcement of the taskforce means that, for the moment, plans announced last October to clarify the role of unauthorised foreign insurers in Australia have been shelved. “This announcement represents a significant potential shift in the North Queensland insurance market,” the spokesperson says. “As a result, the change

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announced by Acting Assistant Treasurer Minister Cormann to clarify that licensed insurance brokers can sell policies from unauthorised foreign insurers where they offer consumers a better price will be deferred until this process is complete.”

But the spokesperson added that other measures previously announced by Minister Cormann would continue. ASIC’s comparison website for home insurance, announced as part of those October plans, recently went live.

The spokesperson says the main role of the taskforce will be to consider options put forward to reduce insurance costs in the region that arise because of the impact of cyclone risk. “The government is exploring the feasibility of meeting the cost of cyclone damage to insured property from the Commonwealth budget or a dedicated funding pool. One option is to create a cyclone reinsurance pool … Another option is for the government to help to establish a member-run mutual insurer to provide

cyclone insurance direct to customers.

“Under both options, some of the expected costs from cyclone damage will still be recouped from property owners through insurance premiums. But property owners would be charged less than the rates set by private sector insurers.”

The spokesperson adds that the taskforce will also consider other proposals that might emerge throughout the consultation process.

In a statement released not long after the announcement, Insurance Council of Australia CEO Rob Whelan said the announcement of the taskforce “showed the government was seeking a positive and consultative approach to significant policy decisions”.

According to the statement, he also said the general insurance sector “would seek to work closely with the members of the taskforce, contributing expertise and insights into shaping policies that would benefit cyclone-prone communities”.

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Case law emphasises importance of brokers keeping good records, says Sydney lawyer RECENT LITIGATION of claims against brokers has reinforced the importance of consistently good record-keeping, according to a senior associate at a global law firm.

Carmen Elder of DLA Piper told Insurance Business that the key trend observed over the past year in litigation against brokers has been “the return of a steady flow of more traditional ‘failure to place cover’ and ‘failure to arrange appropriate or adequate cover’ style cases”.

According to Elder, this follows a number of busy years that have involved a spike in claims against brokers arising from major loss events, including the 2010 Victorian storms and 2011 Brisbane floods.

Problems with record-keeping arise notwithstanding that these matters are traditionally the subject of risk management

training. Elder says, “These [problems] include deficiencies in recording the terms of a broker’s retainer at the outset of the relationship and at the time of key developments during the broker-client relationship [and in] consistently good record-keeping, including keeping notes of the advice given to clients and instructions received.”

Elder says both issues are commonly problematic in defending brokers. She explains, “The terms of a retainer are relevant to a proper consideration of the contractual and tortious duties owed by a broker. The terms are often alleged by clients to be quite broad, and the absence of any proper record by the broker can produce a troublesome ‘he said, she said’ dispute.”

She says that while it’s not possible to definitely say how these types of disputes will be finally

determined, “contemporaneous written records are highly persuasive and can assist in defending a broker”.

Elder says, “It is important for a broker, like other professionals, to keep a record of the date and substance of advice provided and the date and specific instructions received. Every effort should be made to confirm instructions in writing.

If there are written instructions this can assist greatly in defending a broker.”

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NEWS

ROUND-UP

Leading reinsurance intermediary identifies major growth opportunities in APAC DEVELOPING INSURANCE markets in the Asia-Pacific are enjoying fast growth, but penetration rates in the region remain low.

Those are the key findings of Aon Benfield’s recently released Welcome to Asia Pacific Guide, which analysed 16 of APAC’s growing insurance and reinsurance markets, in order to identify growth opportunities.

According to the guide, between 2009 and 2013, India and China enjoyed the highest compound annual growth rate (CAGR) of non-life premium, at 21% and 20% respectively.

Additionally, Thailand, Vietnam and Indonesia enjoyed significant growth, with a CAGR above 15%.

On what’s driving growth in APAC markets, George Attard, head of Aon Benfield Analytics for APAC, says there are three key drivers, the first being the changing demographics of those markets. “Asia has a number of different economies, cultures … bringing their own set of challenges and opportunities. As we see an increase in wealth, we’ll also see increased demand for insurance driving organic growth,” he says.

Attard also points to the amount of regulatory activity in the region. “We’re seeing an evolution to more robust regulation in the insurance space with many regulators transitioning to risk based capital standards driving M&A and sustainable pricing and underwriting standards.”

He also mentions the impact of major catastrophes in the region. “The number of significant catastrophe events we’ve seen in the region has increased risk awareness. It has also

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caught the attention of regulators and other government agencies in relation to enhancing disaster mitigation strategies, but also considering opportunities to partner with the private sector on risk management and risk transfer strategies.”

Yet despite impressive growth, insurance penetration rates in APAC remain low. For 2013, the non-life penetration rate was 0.6% for India, 1.1% for China and 0.7% for Vietnam.

“The local insurers in the Asian markets face a number of challenges in promoting and providing sufficient insurance coverage, particularly for catastrophe risk, given the difficulty in generating economically viable risk pools with sufficient diversification of risk and adequate premiums,” says Attard. “That does create a challenge.”

But with the challenges come opportunities for the industry, according to Attard. “We do have a sophisticated, global reinsurance market that has capacity, the scale and the ability to provide support to those local markets in building up the insurance industry in terms of helping drive insurance penetration.” But he emphasises the importance of risk awareness, regulation and government support in addressing the coverage gap. “Governments can mandate or provide compulsion for homeowners to insure through pooling mechanisms such as CAT pools and also implement premium subsidies as we’ve seen in a number of territories in the region.”

As to growth opportunities lying within Australia, Aon Benfield’s CEO for Australia and New Zealand, Robert De Souza, sees opportunities through insurers re-examining

VIEWPOINT

WHAT CONCERNS YOU MOST FOR THE INDUSTRY IN 2015 Increasingly competitive market 22% Government plans in North Queensland 9% Fallout from FSI Report 12% Continued soft market 37% Other 20%

Total votes: 87 risks currently deemed partly insurable or uninsurable.

On partially insurable risks, De Souza says, “We would encourage insurers to look at these more closely to offer broader base coverages for things like to damage to reputation [and] brand, cash flow, political risk, supply chain failure …”

On uninsurable risks, De Souza mentions economic slowdown, regulatory changes, competition and commodity price risk. “Some of these the general insurance industry doesn’t naturally offer, and we’d say that these are things that we should be looking at as an industry, and there are growth opportunities there because they are part of the total cost of risk.”

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NEWS

ANALYSIS

Disaster recovery Is the aviation insurance market hardening as a result of recent commercial aircraft disasters?

Or has little changed?

SINCE EARLY 2014, the world has witnessed some of the highest profile air disasters it’s seen for some time.

It was 8 March of last year when Malaysia Airlines flight MH370 vanished from radar, presumed to have crashed into the southern Indian Ocean. There were 239 people on board.

Barely four months later, on 17 July, Malaysia Airlines lost another aircraft. This time, flight MH17 was shot down by a missile over the Ukraine, killing all 283 passengers and 15 crew members.

In December, Air Asia Flight QZ8501 crashed into the Java Sea, the cause believed to have been bad weather. It claimed the lives of 162 people travelling from Surabaya in Indonesia to Singapore.

signs of the market hardening during Q4 [2014], which is when the majority of airlines renewals fall due, however, there is so much capacity currently in the aviation sector that the impact hasn’t been as significant as many would have expected.”

Robert Phillips, manager of aerospace at JLT Australia, offers a similar assessment.

“Now that the dust has settled on 2014, insurers have had the opportunity to fully digest the events of last year,” he says. “The consensus of opinion is that these losses, in their own right, will not create a definitive hardening of market conditions for 2015.”

But he also says that the recent major loss in Quarter 1, 2015 will “no doubt create an immediate sense of market fragility.”

“The challenges faced today are certainly not unique” Robert Phillips, JLT And earlier this year in March, Germanwings Flight 4U9525 flew into a mountain in the French Alps, and all 150 people on board lost their lives. Investigators believe the co-pilot, Andreas Lubitz, intentionally flew the plane into the mountain.

Despite the scale of recent disasters that have made global headlines, the impact on the aviation insurance market has been unremarkable. According to Daniel B Crispe, the head of aerospace for AIG in the AsiaPacific region, “there have definitely been

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Scott Guse, an audit partner for KPMG Australia in the insurance field, says most airlines renew their policies either 1 October or 1 November each year, and so both of the Malaysia Airlines events would have been factored into prices set for the most recent renewal period. He says, “what we saw in the most recent round of insurance renewals… was that most airlines received pretty much a premium consistent with last year. There were obviously a couple that had significant increases. Malaysia [Airlines] would have

obviously been one of them… but the majority… were pretty much flat with their premiums.

“If you were going to see an increase in the premiums, you would have certainly seen it in this most recent renewal period…”

Aerial view Guse says that high profile crashes such as those seen in recent times account for, on average, a quarter of insurance claims that come from the aviation industry. “There are an enormous number of minor incidents that really add up to a lot of dollars for insurance companies,” he says. “It’s little incidents such as planes overshooting runways, plane wings clipping other plane wings on the tarmac, planes running into aerobridges, and even baggage handler carts running into plane wheels…”

Phillips says that as tragic as the events of 2014 were, the situation could have been far worse from a financial loss perspective, pointing to the opinion of many experts as to how differently things could have played out if those major accidents had occurred in a more litigious environment. Guse also raises the dramatically different values that courts

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RECENT MAJOR AIR DISASTERS 8 March 2014 Malaysia Airlines Flight MH370 disappears during a flight from Kuala Lumpur to Beijing. No debris is found.

17 July 2014 Malaysia Airlines Flight MH17 crashes in eastern Ukraine; all 298 on board are killed. Pro-Russian rebels deny responsibility.

23 July 2014 TransAsia Airways Flight GE222 crashes in typhoon weather during a flight to the island of Penghu. Forty-eight of the 54 people on board are killed.

around the world place on human life. “If a lawyer launched a litigation suit against Malaysia Airlines, it would be heard in a Malaysian court. The chances are that passengers that died in those flights would be compensated in the vicinity of $100,000 per passenger.

“If you had a Delta [Air Lines] flight that flew off from New York and crashed somewhere in the US and everyone on board died, you’d have litigation lawyers in the court asking for

and [the cost] would have been tenfold probably if they happened inside the US.” According to Guse, it would take “something like a 9/11” to cause step change in the cost of insurance for airlines. Phillips says, “I guess the point to be stressed is that the aviation insurance industry is one which has always needed to respond to the unexpected catastrophic perils thrown at it, and the challenges faced today are certainly not unique in this regard.”

“You need something like a 9/11 [to] create step change in the cost of insurance for airlines” Scott Guse, KMPG at least $5m per person and, more often than not, they would get that.

“So while the Malaysia Airlines incidents are very high profile, the actual [financial] cost to the industry… is not as great as it would have been had they happened inside the US,

The marketplace Of course, the wealth of competition in the market is another big part of the story. “There are a lot of players in the insurance field that want a piece of the action because it’s seen as a glamorous product, a product they should

28 December 2014 AirAsia Flight QZ8501 goes down in bad weather while flying from Indonesia to Singapore. There were 162 passengers and crew on board.

4 February 2015 TransAsia FlightGE235 clips a bridge and crashes into the Keelung River in Taipei, killing 38 of its 53 passengers.

24 March 2015 Germanwings Flight 4U9525 is apparently crashed intentionally by the co-pilot into a mountain in the French Alps. All 150 on board perish.

have in their suite of offerings if they really want to be a global, holistic insurer,” Guse says.

“It is very competitive and, at the moment, there is an enormous amount of capacity wanting a piece of most insurance markets, including aviation.

“The reason there’s a lot of capacity is that… a lot of venture capitalists and high net worth

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NEWS

ANALYSIS

“There is so much capacity currently in the aviation sector that the impact hasn’t been as significant as many would have expected” Daniel B Crispe, AIG individuals essentially want greater return for their money and so they’re willing to take on greater risks, and aviation insurance has seen an influx of venture capitalists come into being a form of insurance protection for those airlines.”

While a significant hardening of the market hasn’t resulted from recent events, cautiousness on the part of airlines may increase, and we may see greater efforts than ever before focused on risk mitigation. Describing the climate following events in this first quarter as “a lot more fragile”, Phillips says insurers will be

counting the cost of those losses and reviewing their risks more closely.

Safety first When it comes to safety in the aviation space, the most recent events have prompted a great deal of discussion around cockpit and cabin security. It seems fair to conclude that discussion will be ongoing for many months to come.

Crispe says aircraft manufacturers, airlines and regulators are constantly striving to improve safety in an industry already renowned for offering the safest form of

Not the deadliest year on record Although 2014 represented an uptick in aviation-related fatalities, global data shows it is hardly an outlier over the past decade 1074 943

905

773 692

760

524

588

475

455

265

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

Source: Aviation-Safety.net

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transportation. He says that we’ll inevitably see more innovation in the space in the coming years, “whether it be mandating of aircraft tracking, locating systems or more advanced systems for weather monitoring…”

Crispe tells Insurance Business that Airbus has developed a system intended to reduce or prevent overruns. Overruns can have potentially catastrophic consequences, including property damage and loss of life.

He expects to see players in the market put “more focus on risk selection, business mix and analytics to ensure that the business remains sustainable in years to come.”

Guse says reputational impact from air crashes will change and drive better risk mitigation steps. He sees most airlines reconsidering flight paths and destinations and while he can’t foresee climate change prompting any major changes at this point in time, he says it, too, is an issue very much on the radar screens of airlines.

But the biggest threat to the airline industry nowadays, according to Guse, comes from cyber-attacks. “Everything is automated on planes and, if someone can get control of a plane remotely through computers, it’s very hard to counteract that. Cyber threats are certainly high on the aviation industry radar.”

However, Guse sees the cyber threat offering opportunities to those in the aviation insurance market. “Trying to factor in pricing to cyber threats in aviation policies is certainly a bit of a black box at the moment. No one really knows how you can do it. But there are a number of companies that are exploring the cost of cyber risks and how much should be factored into premiums.”

While commentators can use their expert knowledge to try and predict the skies ahead, Phillips offers an important reminder: “Last year taught us that you cannot make clear and accurate market predictions in the wake of a significant market loss.”

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BIG INTERVIEW

RACHAEL LAVARS

SEAMLESS STRATEGY

In January, Rachael Lavars became the CEO of Macquarie Pacific Funding. She spoke to Insurance Business about providing better funding experiences to brokers and their clients Insurance Business: You were appointed CEO of Macquarie Pacific Funding in January. What are your key goals for the organisation in 2015 and beyond?

RACHAEL LAVARS: I commenced as CEO of Macquarie Pacific Funding [MPF] earlier this year. This is an exciting time as the organisation is now ready to optimise the opportunities brought about by increased size, scale and capabilities for the benefit of our clients. The business has a strong team by size and experience, but most importantly a complete focus on meeting our clients’ needs.

Over the next year my job is to ensure that we maintain strong engagement with our clients and the marketplace, and we strive to deliver differentiated service and solutions. Part of the strategy for ensuring we achieve this is to maintain our strong alignment with Macquarie Business Banking. The breadth of products and services offered across both businesses, combined with the strength of client relationships and our ongoing commitment to support the needs of our clients in a changing marketplace, has successfully differentiated our proposition over the past decade.

IB: What trends will you be watching in premium funding in the year ahead and, more generally, in the insurance industry?

RL: Changing attitudes and behaviours for transacting online has been topical for some time, and I’ll be watching this advancing trend

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over the next year. More buyers of business insurance are turning to the internet to research their insurance needs, research the range of insurance providers, with an increasing number looking to purchase and transact online. There is increasing demand to make the procurement and payment of insurance as simple and accessible as possible. We offer a solution called Macquarie Premium Payments Online which provides a full payment capability, including a monthly instalment option to support online distribution platforms. This solution was developed in anticipation of this changing trend.

“The organisation is now ready to optimise the opportunities brought about by increased size, scale and capabilities for the benefit of our clients” IB: When it comes to discussing emerging risk areas in insurance, cyber risk seems to consistently be at the forefront of that discussion.

Is cyber risk something about which the premium funding space is also concerned?

RL: With our increasingly online and interconnected business models, it is vital that anyone in the insurance industry maintains safe and reliable service which cannot be compromised. The other thing we are acutely aware of is data protection. As premium funders we hold client information on our systems, so we have to take all reasonable steps to protect this information from any threats.

IB: How important is it for premium funders to embrace new and emerging technologies? Are there any current technological innovations at Macquarie Pacific Funding about which you’re particularly excited?

RL: Applying technology in any financial services business is a well-trodden path, and premium funding is no different. While it makes sense for anyone in our industry to keep their eye on technology trends, for us it is about being clear on the business purpose for the technology and how

MACQUARIE PACIFIC FUNDING December 2012: It is announced that Macquarie Premium Funding had entered into an agreement to acquire GE Capital’s Pacific Premium Funding in Australia and New Zealand.

February 2014: The newly integrated Macquarie Pacific Funding business is unveiled.

January 2015: Rachael Lavars is announced as Macquarie Pacific Funding’s new CEO.

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“Technology for technology’s sake is not something we do”

RACHAEL LAVARS ON KEY CHALLENGES FOR THE PREMIUM FUNDING SPACE AND THE INSURANCE INDUSTRY IN THE YEAR AHEAD

“Below-trend economic growth, excess capital causing soft market conditions, and competition are key challenges. To grow in this environment, providers in the insurance market need to demonstrate value and differentiate away from price.” www.insurancebusinessonline.com.au

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BIG INTERVIEW

RACHAEL LAVARS “The internet provides a source of informal advice that is not matched by the knowledge, contacts and experience of a broker” it will support us, as well as our valued channel partners and their clients. Technology for technology’s sake is not something we do.

However, if a new technology can prove itself as supporting a new and valued way of doing business, then we’ll happily embrace it.

IB: Prior to becoming CEO of Macquarie Pacific Funding, you were head of the insurance broking segment for Macquarie Business Banking. Brokers today face the challenge of more customers becoming willing to transact directly online for their insurance needs. How do you think brokers can successfully promote the value of their advice to consumers in this current climate?

RL: Potentially, brokers need to adapt their approach to clients with changing attitudes and behaviours in the current digital world. There is an increasing trend for customers to do their own online research, even if they’re not looking to purchase online. Brokers need to ensure they continue to demonstrate the value of their expertise in assessing risks, and the value they then bring in their ability to source the most appropriate products, terms and coverage in the market. The internet provides a source of informal advice that is not matched by the knowledge, contacts and experience of a broker, and the insurance products offered online are typically homogenous in structure. Brokers additionally play a valuable role should a claim event arise.

IB: Do you think there’s a need for brokers to better understand premium funding products and the benefits those offerings can provide to their clients?

RL: I believe there is scope for some brokers to offer premium funding to their clients more readily as a payment choice. The product is

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straightforward and easy to procure. In our experience, brokers who readily offer premium funding have higher acceptance levels of the product than those who don’t. It remains our responsibility to continue to work with our broking partners to realise opportunities for them and their clients, and to ensure we continue to deliver solutions that evolve with the needs of the changing marketplace.

IB: You played a key role in Macquarie Premium Funding’s acquisition of Pacific Premium Funding. What would you cite as particularly key achievements or valuable lessons learned from that experience?

RL: Following the successful integration of Pacific Premium Funding, we are able to provide an improved experience to brokers and their clients by taking the strengths of both organisations to deliver a blend of products and services. Brokers now have the benefit from high-quality services and systems that integrate seamlessly into their business, as well as access to our expertise and insights. We are continuing to invest in product and service innovation that drives efficiencies for brokers. Their clients benefit from competitive, easy-to-use funding products that are seamlessly accessible. An integration of this size was always going to have its challenges; however, we are delighted with the outcome. What we have now is a business that brings together the best of both worlds. You can’t underestimate the importance, effort and

time required to align two organisations, as well as internal and external relationships and engagement, and to coordinate a new approach to doing business.

IB: Do you think recruiting and retaining good staff is an industry or an individual company issue? And what should be done about it?

RL: I believe it is the responsibility of both the industry and organisation to engage with the community to secure future talent. Overall, I believe at an industry level there needs to be a focus on promotion of career opportunities to increase awareness of the exciting opportunities, and the rewards and recognition that come with those. Investing in our leaders to take the industry into the next decade with passion and innovation is important.

IB: Why do you think attracting new talent continues to be an issue, and what do you see as key steps the industry could be taking to make insurance an industry of choice among jobseekers?

RL: Attracting good talent is an issue for all sectors, with the insurance industry included.

Historically, the industry has not been strong in promoting the possibilities of a career in insurance. However, I am aware that there are now steps being taken by some of the major insurance companies, together with NIBA, to increase awareness. I believe this is an important step. Another significant area is managing our talent pipeline and having a plan for each individual. We need to demonstrate the strengths of working in insurance in the global community and present a value proposition that

RACHAEL LAVARS ON DEALING WITH THE CURRENT SOFT MARKET CONDITIONS

“During soft market conditions price expectations increase, therefore providers need to continue demonstrating value in their product design and service features.

They need to shift a pure price-based decision to a risk-based, advice-based or efficiency-based decision. It is important to ensure that the insurance placement and payment process are as straightforward as possible.”

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appeals to the future workforce. For us, when we are looking to recruit new talent it is important that potential hires understand that being part of our team means they are given a real sense of ownership of the future of the business.

IB: Another issue that’s currently topical is gender diversity. Women are still underrepresented across the different levels of the insurance business, particularly at management level.

How does the industry need to change in order for us to see more gender diversity at senior levels?

RL: I have been fortunate throughout my career to have been challenged and mentored by great leaders. At MPF, approximately 50% of our staff members are women and 40% of our leadership team are women. This figure is pleasing as it demonstrates an environment

“You can’t underestimate the importance, effort and time required to align two organisations” that is supporting opportunity for women.

Broadly across the Australian financial and insurance industry, the challenge is ensuring that strong female representation flows to the senior levels. To achieve this there needs to be equal opportunity for women and consideration given by companies to support flexible working arrangements. With the right opportunities and support available, I have no doubt that the next generation of women will be even more successful.

IB: Inga Beale, the current CEO of Lloyd’s, has been quoted as saying, “Being more diverse is good for business”. Do you agree with that statement?

RL: There is so much research and data to support that statement that it is impossible not to agree! The issue is that when people talk about diversity they can tend to default to considering gender and other forms of demographic diversity, whereas leveraging diversity of thought and perspective is where the true value of diversity can be realised. I have complete respect for Inga Beale, what she has achieved and what she represents to women around the world. I hope I provide inspiration for people rising though the insurance sector and to embrace the benefits of diversity, which ultimately encapsulates the diversity of thoughts, ideas and vision.

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www.insurancebusinessonline.com.au

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15/04/2015 2:11:00 PM

COVER STORY

ELITE BROKERS 2015

Australia’s

BROKERS 2015

Australia’s top insurance brokers ranked and celebrated, including interviews with the best of the best WELCOME TO the 2015 Insurance Business Elite Brokers list.

For three years now, Insurance Business has rated and ranked Australia’s insurance brokers to find the person worthy of the title ‘Australia’s Top Broker’.

We’ve received a wealth of positive feedback about our two previous lists. Many of our entrants have found that endorsement as an Elite Broker brings recognition from both colleagues in the industry and clients, and serves as a valuable business development and marketing tool.

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There’s no shortage of impressive achievements being racked up by brokers in Australia, and we’re proud to be able to offer a handful of those high achievers this recognition. We sincerely thank all of you who submitted an application in 2015. We are confident that the Elite Broker list will continue to go from strength to strength, and look forward to an even higher number of entrants (and an even tighter race) in 2016.

Tim Garratt, editor, Insurance Business

www.insurancebusinessonline.com.au

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THE TOP 30 Rank

Name

Company

METHODOLOGY

Ron Tatarka

Scott Winton Insurance Brokers

Russell Bresland

Bresland Consultants Pty Ltd (AR for Insurance Advisernet Australia)

=3

Kevin Forrest

Australian Insurance Services Pty Ltd

=3

Simon Althaus

Scott Winton Insurance Brokers

Ken Dixon

Dixon Insurance Services Pty Ltd (AR for Westcourt General Insurance)

The Insurance Business ranking system is an objective means of ranking the best-performing insurance brokers in the country – not just those with the biggest portfolios or the largest clients.

Each broker was required to supply their own details to Insurance Business to be eligible, along with details of a contact who could verify those figures. We also gathered information about non-financial achievements.

In total, there were eight criteria, covering: • number of policies written • total revenue • revenue per policy • number of clients • new clients • new client revenue • client retention

1 2 NEW ENTRY

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Rank

Name

Company

6

Peter Chamberlain

allinsure

7

Zara Mends

National Credit Insurance

=8

Tate Harris

allinsure

=8

Victor Dabrowski

Securitex Financial Services Pty Ltd

10

David Summers

Markey Insurance Brokers

NEW ENTRY

11

Michael Stewart

Stewart Insurance Group Pty Ltd

NEW ENTRY

= 12

David Smith

Scott Winton Insurance Brokers

= 12

Karen Hardy

ACME Insurance Brokers

14

Oliver Whittingham

Matrix Insurance Group

15

Avi Tatarka

Scott Winton Insurance Brokers

16

Luke Phillips

Gardian Insurance Services

= 17

David Coe

Northwest Insurance

= 17

Kay Jackson

Simplex Insurance Solutions

19

Prudence Chang

National Credit Insurance

20

Trent Mockford

Brookvale Insurance Brokers

21

Karlo Abrenio

Megalines Insurance and Risk Advisers (AR for Westcourt General Insurance)

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Karen Frazer

Shield Trade Credit Pty Ltd (AR of Winley Insurance Group)

23

Bunmi Ajayi

Magalines Insurance and Risk Advisers (AR for Westcourt General Insurance)

24

Shane Moore

Trade Risk (AR for Westcourt General Insurance)

= 25

Ben Spokes

Crowe Horwath Insurance Brokers

= 25

David Clarke

Elliott Special Risks

27

Adam Pile

Your Risk Adviser

28

John Craven

AR with MGA Insurance Brokers

29

Daniel Webber

30

Vanessa Davis

Webber Insurance Services (AR for Westcourt General Insurance) B&L Financial Services (AR for Westcourt General Insurance)

NEW ENTRY

NEW ENTRY

NEW ENTRY

NEW ENTRY

NEW ENTRY

NEW ENTRY

Each broker was ranked in each of these measurements and the sum of all of their rankings was calculated. The brokerages were then placed in order of who had the lowest overall score (think of it as a golf score, where having higher rankings in each section means you have a lower total score).

www.insurancebusinessonline.com.au

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15/04/2015 3:42:43 PM

COVER STORY

ELITE BROKERS 2015

“If you’re true and honest and you’re genuinely seeking to help your clients and are there for their best interests, you can’t fail” DAVID SUMMERS’ SECRETS FOR SUCCESS “If we only give to our clients what we’d be prepared to give to our parents… If you do the right thing by people, you’ll succeed. If you start lying to people … to win accounts, you’ll get found out sooner or later. You can’t keep that up forever. If you’re true and honest and you’re genuinely seeking to help your clients and are there for their best interests, you can’t fail.”

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10

David Summers

Senior insurance broker, Markey Insurance Brokers

David Summers is certainly no stranger to the Insurance Business Elite Brokers Top 30. He’s ranked in the Top 10 in every one of our lists.

Summers is the senior broker in a team of three broking staff, based in Newcastle, NSW. Asked about the focus of his portfolio, Summers says, “If I see a competitive edge, a new product, something that’s going to value-add to clients that isn’t being offered elsewhere, that’s the industry I go towards.”

He’s frustrated by public perceptions of the industry as a whole, being shaped by the advertising and marketing of direct channels. He says it means there’s a need for brokers to continue to differentiate themselves from insurance companies. “Sitting back and watching the direct market sour everyone’s opinion on the insurance industry … I think that’s the hardest thing.”

Summers doesn’t hesitate for a second when asked about the highlight of his past year. “That’d have to be the birth of my son,” he says. “I’ve got a beautiful daughter and [her birth] was the highlight of 2013, and 2014 was the birth of Jax.” His advice for other brokers is to recognise the prospects that arise in the current soft market. “Look at it as an opportunity … being able to provide clients with something better than they had last year, not always looking at trying to be the cheapest, but offering the best.

“I think that people look at this competitive market and they see it as more of a hindrance, but I think it’s just a fantastic opportunity to win new clients and do good things by our existing [clients].”

=8

Victor Dabrowski

Securitex Financial Services

Joint eighth-place holder Victor Dabrowski has had a particularly busy year. In fact, he says even he was surprised when he calculated the number of new clients he’d picked up in 2014.

And while the volume of new business was his highlight of last year, it also meant time management became Dabrowski’s biggest challenge.

Talking about the industry as a whole, Dabrowski thinks it’s time it began working to make itself more attractive to jobseekers. “The industry doesn’t sell itself well enough as a career,” he says. “I remember going to school careers nights and I don’t think there was ever anybody from the insurance industry touting [being involved in the industry] as a really fantastic career move.

“It’s the best industry that you can be involved in because you do make a huge impact on people when you do insure them correctly and then, in their hour of need, look after their claims, hold their hand …”

VICTOR DABROWSKI’S SECRETS FOR SUCCESS “Being a broker or an insurance adviser, we have to make ourselves relevant to our clients … which means not only do we have to give them great advice and make sure that they’ve got the correct covers… but also we have to handle their claims because that’s where the proof in the pudding is…. By handling our clients’ claims, we take the pain out of that claims process, and clients know that every time something leads to a claim, they ring us, and that’s making us relevant in the minds of the clients.”

www.insurancebusinessonline.com.au

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Tate Harris

Senior account executive, allinsure

First-time entrant Tate Harris is excited to receive what he describes as “his first pat on the back” for his work in the insurance industry.

Harris, our joint eighth-place holder, has a book he says covers “pretty much anything”, and he wouldn’t want it any other way! “It’s a lot to take in, it’s a lot to learn, it’s a lot to store, but once you get the hang of it, it’s really fulfilling.”

The last 12 months have provided Harris with the opportunity to take on a managerial role within allinsure.

It’s been both his biggest challenge and greatest highlight of the year. “We had some key staff leave, which presented an opportunity for [me] to take the bull by the horns and take on a lot of their portfolios ... While it was a challenge, I think I’ve seized the moment … and I’m obviously doing alright.”

As for what’s next, he tells Insurance Business, “I want to continue to better myself.” Currently studying for his diploma, he’s also looking to undertake a number of personal development programs, and adds, “I want to learn more about the management of a business and move into that space as well.”

Insurance Business wishes Harris well in all further learning endeavours he pursues!

For the second year in a row, Zara Mends finds herself ranked in the Elite Brokers Top 10. She was very pleased to receive the news that she had placed this year at “lucky seven”.

In 2014, Mends was invited to become part of NCI’s management group and was promoted from branch manager to general manager of Queensland. Under Mends’ management, the branch’s portfolio is growing, and new business, lapses and profit expectations YTD have been exceeded.

Mends manages a retention portfolio of 400 clients worth over $4m in brokerage income. Clients come from a diverse range of industries, including agricultural business, building and construction, labour hire, mining services and petroleum.

Asked about her highlights for 2014, Mends says, “Promoting and developing new members of the team comes to mind first. Achieving and exceeding our sales and retention targets is also very satisfying, knowing our hard work is reflected in our results.”

On advice she’d offer to other brokers, she says, “It’s important to ensure you are tailoring your advice and service to individual client needs rather than trying to have your client fit into what you already provide or do for other clients. Be flexible in your service offering to each client.”

She also cites the importance of recognising and promoting young talent, identifying factors that will impact on clients’ businesses and offering solutions, and avoiding promotion of a product and service purely based on price. “Focus on where you can add value to your clients’ businesses and insurance program,” Mends says.

TATE HARRIS’S SECRETS FOR SUCCESS “We have a strong focus on continuing to find new referral avenues. A lot of them come from existing clients … and not only that, but being able to generate further income out of our current clients with new policies that are introduced to the market or [because of] changes in legislation.”

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Zara Mends

General manager Qld, National Credit Insurance

“I love what I do and believe in the product and service offering we provide for our clients” ZARA MENDS’ SECRETS FOR SUCCESS “Maintaining a client focus is the main key to my success. Listening to clients and recognising their needs and being proactive in providing support and advice.

I am very fortunate to have a great team of dedicated and passionate people to work with, which is very important in my opinion to both personal success and the success of our business generally. Recognising and developing talent in new employees is also vital for the overall success of the branch and team.”

www.insurancebusinessonline.com.au

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15/04/2015 3:42:45 PM

COVER STORY

ELITE BROKERS 2015

“The killer for us is having clients understand that not all products are the same”

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6

Peter Chamberlain

Director, allinsure

Tate Harris isn’t the only member of allinsure to make his debut in the Top 10. Sixth place belongs to his boss, Peter Chamberlain.

Chamberlain’s appearance at number six is just one of many accolades he and his team have received in recent years. Last year, allinsure was seventh in Insurance Business’s Top 10 brokerage survey.

And he’s hoping to make the business even bigger and better. “That’s where we’re aiming at the moment,” he tells Insurance Business. “A couple more staff are joining us within the next six weeks, which is good, and we’re hoping to increase and expand from where we’re at.”

Reflecting on highlights of recent times, Chamberlain singles out the changing focus of the office, going from a product pusher to placing a total emphasis on risk management and providing advice.

“We’d always tried to push ourselves on personalised service, etc., but [our change in philosophy involved] really taking the focus 100% away from products and directly into that risk management and advice side of things and, to be honest, rarely using a product that’s off the shelf.”

He’s keen to see public perception of the insurance industry change. He explains, “We want to be perceived in the same light as the client’s accountant, lawyer, etc., rather than the direct marketer, the call centre operator, the used car sales operator …”

He also wants to steer consumers away from placing too strong an emphasis on price. “The killer for us is having clients understand that not all products are the same. Just because it says ‘business pack’ or ‘public liability’ doesn’t mean it gives you the same coverage as a policy offered by the next company.”

5

Ken Dixon

Director, Dixon Insurance Services (AR for Westcourt General Insurance)

While he is no stranger to the Insurance Business Elite Brokers Top 30, 2015 marks Ken Dixon’s first appearance in the Top 10.

Quizzed on the 2014 highlight for him and his Toowoomba-based brokerage, Dixon finds it difficult to single anything out.

One instance he recalls followed the recent Cyclone Marcia in Rockhampton. “We had a fairly significant claim up there for a pharmaceutical client,” he says.

“We jumped on it pretty hard; the insurance company backed us all the way … and as a result, we had a brilliant claim settlement. The client has been super happy. He’s referred another 180-odd pharmacies and medical practitioners to us, who we’re in the process of talking to.”

Unsurprisingly, expansion is on the cards at Dixon.

“To get bigger and to grow, there’s only so much you can do locally. You’ve got to look at expanding,” Dixon tells Insurance Business. “We’re right now actively looking at purchasing other brokerages.”

Talking about the level of service his team offers customers, Dixon says, “We’ve got a very heavy service aspect to what we do, where we’re available 24/7 to our clients at no cost. That’s part of our commitment to them.”

His praise for his staff – Anita, Jenny and Leanne – is high, as well as for Jeff Hollands and Lorinda Webster-Brooking of Westcourt General Insurance Brokers.

And what’s his advice to other brokers about building their businesses? “Being an advocate for your client and knowing your client is the number one thing for us, and that’s what drives the business.”

www.insurancebusinessonline.com.au

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15/04/2015 3:42:49 PM

COVER STORY

ELITE BROKERS 2015

=3 “Do your due diligence and don’t rest on your laurels”

Kevin Forrest

Managing director, Australian Insurance Services

Sharing third place is Kevin Forrest, managing director and owner of Australian Insurance Services in WA, a company he founded 20 years ago.

An industry veteran of 28 years’ experience, Forrest describes 2014 as “a tough year” and says a major challenge for him and his company has been coming to grips with new marketing strategies aimed at securing new business.

“The way you get business is changing now. You’ve got to try to get used to Google. Yellow Pages advertising is no longer producing any solid leads.”

Forrest would like to see heightened awareness in the community of the benefits of dealing with insurance brokers. “To some degree, I think we’re losing that battle,” he says. “I remember when I first came into insurance broking many years ago, people were aware of the value of brokers … and that they should have someone who’s an advocate on their side to look at the insurance policy wordings and make sure that they get the best wording for their circumstances at a competitive price.

“I think we don’t promote our value proposition to the general public very well, and I wish we did that better.”

His advice to other brokers is to try to stay close to their major clients. “Do your due diligence and don’t rest on your laurels … It’s quite amazing how most clients you speak to are really aware of the soft market … so you’ve really got to be on your toes and not get complacent.”

KEVIN FORREST’S SECRETS FOR SUCCESS “Probably just some of those old-fashioned high service standards – getting back to people quickly, trying to look out for the interests of my client always.”

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Joining Kevin Forrest in third place is a Top 10 veteran.

Scott Winton Insurance Brokers is a brokerage name that’s likely to be familiar to many long-time Insurance Business readers. This year, four of their brokers have ranked in our Top 20. Their second-highest ranked broker is NSW state manager Simon Althaus.

Althaus tells Insurance Business he is “elated and humbled” to make the list again in 2015. Asked to single out a highlight for last year, he says it was “having the privilege of working alongside a team of dedicated and professional staff who are committed to the best interests of our clientele, thereby playing an integral role in the high level of customer retention, as well [as] winning new business primarily via referral”.

Looking ahead, he says he’ll remain focused on the job and is hoping to secure a place in next year’s Elite Brokers Top 30.

SIMON ALTHAUS’ SECRETS FOR SUCCESS • Keep up to date with insurance market trends and evolve accordingly.

• Impart useful industry information to your clients throughout the year that potentially impacts on their assets and business operation, along with the insurance policy information that has relevance.

• Provide clients with utmost trust and confidence in your ability to guide and problem solve, in a professional and efficient manner.

• Be available and respond promptly when called upon.

• Turn your clients into your biggest advocates and PR agents by delivering to them a comprehensive level of service all year round.

=3

Simon Althaus

State manager NSW, Scott Winton Insurance Brokers

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With over four decades of industry experience, WA’s Russell Bresland is at number two.

Bresland has a substantial portfolio of not-for-profit organisations, and seems to have found himself on various award nomination lists in recent times.

It’s hard to believe his career in insurance almost came to an end eight years ago. “I used to own a broking firm, and I sold it in 2007 and was going to retire,” he tells Insurance Business. “After three years, I got so many complaints from the old clients that we decided to come back … and it’s just become an absolute success story.”

Bresland estimates about 60% of his old clients returned, and says the business has since gone from strength to strength. “But purely because of service, I think,” he adds. “Our clients have come to expect a very high standard.”

On the growth of his business, Bresland says, “It’s grown exponentially. And where does it come from?

Word of mouth. We don’t advertise. It’s just referral, referral, referral.”

On what’s ahead, Bresland says, “We’re very RUSSELL BRESLAND’S proactive. We want to keep SECRETS FOR growing. There’re a million SUCCESS opportunities out in the marketplace.

There is “If you’ve got the right nothing to stop us growing service and the right by the same amount that we knowledge, the clients did last year next year. The will remain with you for only thing that stops you many years.” growing is yourself.”

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Russell Bresland

Owner, Bresland Consultants Pty Ltd (AR for Insurance Advisernet Australia)

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Ron Tatarka

Managing director, Scott Winton Insurance Brokers

Achieving first place in the Insurance Business Elite Brokers Top 30 is outstanding. Securing the top spot two years in a row is an even stronger testament to a broker’s elite status in the industry.

But demonstrating the ability to outrank all other entrants for three consecutive years has to make you a trailblazer in the broking space – someone who your peers can look to, and whose example they should strive to follow.

Melbourne’s Ron Tatarka has achieved precisely that, securing number one in our 2015 survey.

Tatarka, who founded Scott Winton Insurance Brokers back in 1992, says he feels “very humbled” to have ranked at number one once again and is extremely grateful to all of his staff. He’s also proud of the recognition from the broader community that his business has received as a respected broker.

Asked about the business’s greatest challenges last year, Tatarka, like many of his industry colleagues, cites the highly competitive Australian market. Yet in a tough year Scott Winton managed to achieve 7.5% growth. On the drivers of this growth, Tatarka says, “It really is referral business that’s coming in.”

Tatarka praises the efforts of Scott Winton staff who build relationships with clients based not only on price but on the service and the expertise they can deliver. And it’s not just a client-focused brokerage Scott Winton offers the community. Philanthropy is also a core part of its mission. Scott Winton supports charitable organisations such as the Quill Club Inc, the Lions Club of Melbourne, the Live Life Foundation, and Wings of Care.

Insurance Business congratulates Ron Tatarka on this remarkable accomplishment.

www.insurancebusinessonline.com.au

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15/04/2015 3:43:02 PM

FEATURE

MICHAEL KERNER

GLOBAL PERSPECTIVE Michael Kerner, CEO of general insurance for Zurich Insurance Group, talks about preparing for the unexpected, and taking insurance solutions to more customers than ever before THE CYBER PROTECTION currently available to organisations does not necessarily cover all risks and exposures that companies have, says Mike Kerner, Zurich’s global CEO of general insurance.

On a visit to Sydney in March, Kerner spoke to local media about Zurich’s progress against its global three-year strategy, and a number of issues topical in the space.

Still on the subject of cyber risk, Kerner says, “It’s a very challenging risk because it’s almost impossible to build the walls high enough to keep the bad guys out and permeable enough to let the good guys in”.

In terms of uptake of cyber protection, he thinks the US is probably leading the way, in part because of its litigious environment. He adds, “I also think that the product that’s currently being sold by the insurance industry is not actually satisfying the needs of the customer, and that’s the problem. So you can buy something in cyber and, often, the risk managers and executives and the boards want to buy something that’s available but, right now, the coverage is limited.

But Kerner expects the market to evolve. “I think what will be necessary is that companies will have to get better at their own loss control and risk management, which will then make it a more insurable risk, which will then have insurers prepared to expand the coverage and reduce the price, so that companies will actually buy the coverage.”

Zurich’s business in Australia constitutes approximately one-third of its Asia-Pacific business. “It’s a very interesting market, it’s a very important market for Zurich and it’s a very important market for the insurance business,” says Kerner.

He became Zurich’s global CEO of general insurance in September 2012. He’s spent most

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of his career with the international industry giant, undertaking a number of roles.

He tells Insurance Business that one day that stands out in his three-decade career in insurance is 11 September 2001.

He was working in Zurich’s offices in Downtown Manhattan, across the street from the World Trade Center. As he recalls, those events were both a bad day for the industry and a bad day for the country. “In addition to the personal impact that kind of an event has on you, being that close to it… it reinforced to me, frankly, that you always have to expect the unexpected.

The things that you can’t even imagine could happen, actually could happen…

“And that’s actually why we’re here as an

conflicting regulations.”

Kerner also cites the new capacity coming into the market, and the pressure it will place on margins, as another key industry challenge.

But he also sees great opportunities for the industry, especially in emerging markets in Latin America and Asia. “As the middle class grows, people accumulate assets, those assets wind up needing insurance and we are in a position where we can provide that insurance… It’s the same products, but just for different people and different geographies.”

According to Kerner, there are also plenty of opportunities arising from the increasing occurrences of extreme weather events. “While it’s a challenge for the industry to be able to deal

“The things that you can’t even imagine could happen, actually could happen” insurance industry; to help people through those times and we need to be prepared to respond. I think that’s very much ingrained in the way I think about risk management for an insurance company.”

As to current global challenges for insurance, Kerner sees regulation, particularly around consumer protection, as a major pressure for the industry in times ahead. “I think the regulatory environment will continue to evolve and that will be a challenge as we have to adapt our business models to comply with those regulatory challenges,” he says. “I think regulators are very much focused on making sure the consumer is protected, and that makes a lot of sense. But often, it can go a bit too far. Often, as well, one jurisdiction’s regulation conflicts with a regulation from another jurisdiction and as a global company, it’s very challenging for us to deal with

with those … events, it also creates a lot of demand for insurance and, as an industry, if we can deal with those challenges and provide a product that’s valuable, clearly we would expect to see revenues go up from that kind of product.”

One opportunity Zurich has taken up, about which Kerner is particularly excited, is the microinsurance venture incubator project (MVI), announced at January’s World Economic Forum in Davos. “I think it’s a real example of how the industry can step up and do something that’s transformational and really innovative around this particular issue of microinsurance,” he says.

The Bermuda-based MVI entity was formed for the purpose of delivering insurance solutions to very low income individuals in developing countries. Zurich is one of nine companies involved in the MVI. “We think it’s pretty critical that more and more people have the opportunity

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“It’s pretty critical that more and more people have the opportunity to participate in the financial services industry”

to participate in the financial services industry.

Often, those who are most exposed to losses that really would impact their lives on a very detrimental basis are those that are least able to access the protection mechanisms that are in place in society, that those kinds of financial services would provide.”

Providing these offerings will present many logistical challenges, and Kerner sees the partnership between these organisations as key to being able to create the necessary innovations.

“We’re going to work together to really try and develop the right innovations to make this something that works more holistically for that part of the population that’s really exposed to adverse events.”

Kerner expects that Africa, emerging Latin America and emerging Asia will be the prime areas of activity for the MVI.

MICHAEL KERNER ON DEALING WITH COMPETITION IN THE MARKET “The competition always exists. It always has existed. It always will exist. We have a great value proposition and we sell the great value proposition. It’s not just price. It’s the service that you surround the product with. It’s the underwriting expertise that you bring to the table.

It’s the ability to handle claims and to help customers in the circumstances where a claim arises.

These are the things that are part of the value proposition and clearly something we’re focused on selling.”

He reinforces that the MVI is not a charitable endeavour, but a business. “Charities get cut when budgets get cut. Businesses that make money get continued, whether there’s a soft market, a hard market… So it’s not a charity.

It’s a business.”

He’s also buoyed by the impact it will have on Zurich employees, both present and

prospective. “We will help the MVI with seconded resources, we’ll give employees opportunities to rotate through that organisation… So it’s not just those who are getting access to the financial services that benefit. It’s our employees who get to contribute to something that they feel is really meaningful from a social responsibility perspective.”

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15/04/2015 11:45:03 AM

FEATURE

GENDER DIVERSITY

TAKING DOWN THE BARRIERS

Greater diversity in the workplace is said to make better business sense. How can the industry in Australia achieve true gender diversity?

INGA BEALE, Lloyd’s first ever female CEO, told AFP in January that “Businesses that have better diversity in their management teams and board sustainably produce better results”. And it’s by no means a radical opinion.

Niran Peiris, Allianz Australia’s CEO, tells Insurance Business, “I’ve always thought that when I’ve sat in a room where you do get that diversity of thought, you do get very strong decisions being made.” He says that, in the end, diversity is “just good for business”.

But in insurance in Australia in 2015, gender diversity is a piping-hot topic and, after looking at the make-up of the industry’s higher ranks, it’s not difficult to see why. Yolanda Beattie, public affairs executive manager of the Workplace Gender Equality Agency (WGEA), says both men and women are well represented in the general insurance space overall. But she adds, “When you go up the management levels, the numbers of women fall off considerably, and when you hit the top of the food chain at the CEO level, less than 4% of CEOs … are women.”

In November 2014, ANZIIF and its Women’s Council launched the first Women in Insurance survey. Over 1,000 members participated in the research, with members representing 17 countries. Asked whether, while working in insurance, they had ever been remunerated less than a male colleague doing the same job, 64% of the respondents said yes for the period prior to 2011. The figure was 51% for the period 2011–14.

Gender diversity in the workplace remains a global issue. Jane McNeill, director of Hays Insurance, spoke to Insurance Business about Hays’ Leading Women survey, which involved almost 6,000 respondents across 31 countries.

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McNeill says: “Probably the main finding was that women are less likely than their male co-workers to believe there is pay equality and equal opportunities that exist for both genders in the workplace … 18% of men compared to 45% of women think that equally capable male and female colleagues are not paid or rewarded in equal manner.

“It suggests that most people in executive and senior management roles, the majority of whom are obviously men, still fail to see any inequality.”

McNeill says Hays also recently conducted another study with gender diversity (this time in Australia) as its central focus. “It was a survey of hiring decisions and subconscious bias,” she

THE GENERAL INSURANCE PICTURE IN AUSTRALIA

The WGEA captures data on 31,351 employees in general insurance in 24 organisations in Australia

The WGEA reports that 56.5% of employees in general insurance are female. That figure can be compared to all industries, where the figure is 48.5%

explains. “It took a survey of decision-makers – hiring managers, HR professionals, etc. – and presented two résumés to them … [Each candidate had] exactly the same experience. One was a female name and one was a male name, and they uncovered quite a bit of unconscious bias, particularly from people who are making hiring decisions.”

Most significantly, the survey revealed both men and women are more likely to hire a man.

Why is that the case in Australia in 2015?

Why do women continue to be underrepresented in the higher levels of business?

Bias The WGEA reports that 84.4% of employees in the general insurance industry have full-time roles. Across all industries, the figure is 57.7%

Yolanda Beattie says the biggest issue is gender bias – how men and women are viewed by society, and how that then translates to how each gender is seen in the workplace.

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“[Gender bias is] the root cause of the problem, and it’s the biggest piece that has to be acknowledged before … you can put in place the work to address the structural and cultural barriers,” she says. “Once employers really get this notion of gender bias and why it’s inhibiting women in their workplaces, they can put in place a comprehensive strategy that puts a gender lens across all of their key business systems and processes.”

Beattie explains the impact of gender bias specifically in relation to working mothers.

“There’s often this benevolent sexism that goes on, where we think [of ] a mother coming back to the workplace … there’s this view of, ‘She’s not going to be wanting to take on those big assignments and be put under that pressure, so let’s not even have the conversation or offer it to her. Let’s just give her a cushy part-time

“Probably the biggest issue that we see in workplaces is the notion of gender bias” Yolanda Beattie, WGEA role that’ll support her needs while she’s having a family’.

“Now if that’s the outcome after having a detailed conversation … then fine, because some women really do want to put things a little on the backburner when they’re having a young family … But the problem is those conversations rarely happen in workplaces. Managers need to be trained, and the workplaces overall – the systems, the policies and programs – need to provide support so that those conversations happen.”

McNeill says flexible working environments can help organisations succeed in addressing the

gender diversity issue. “Certainly flexible working arrangements can help women with families who are in more senior positions.”

Beattie says the flexibility discussion isn’t just a conversation that should be happening with mothers. “I think this is a problem that really goes to the gender bias issue as well. Why aren’t we having this conversation about working fathers?”

She says the sooner these kinds of conversations stop being about gender (and instead become simply about people in the workplace) the better, but admits there’s a long

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15/04/2015 11:46:17 AM

FEATURE

GENDER DIVERSITY MANAGERS: THE GENDER COMPOSITION Type of manager

Male (general insurance)

Female (general insurance)

Male (all industries)

Female (all industries)

CEO/head of business in Australia

96.3%

3.7%

82.7%

17.3%

Key management personnel

78.7%

21.3%

73.9%

26.1%

Other executives/general managers

78.0%

22.0%

72.2%

27.8%

Senior managers

70.4%

29.6%

68.3%

31.7%

Other managers

59.6%

40.4%

60.2%

39.8%

Source: Workplace Gender Equality Agency

way to go before that can happen. She also says it’s time for employers to start dealing with their employees as whole people. “This is what drives me crazy … You ask CEOs what’s their most important asset and all of them will say their people. But rarely do they see it as their responsibility to see how they can really manage their employees as people.

“These are people that come with lives, and the sooner we see talent as the full spectrum of an individual – that includes their family ambitions, their community ambitions, their sporting ambitions – and we have a conversation about how we can support them in the workplace, looking at the total sum of their life, the better we will be at engaging employees, at motivating them, at driving discretionary effort, at building their careers and ultimately delivering more productive workplaces, because that is ultimately what gender equality comes down to – building more productive and engaged workplaces.”

Beattie says, in terms of bringing about real change, what’s required is not a programmatic approach that sees companies doing women’s networking and talent development initiatives in isolation. Instead it’s about building a gender strategy that’s part of a broader business strategy “that enables a sustained and long-term focus and approach that ultimately delivers outcomes”.

On a similar note, Meg Hurley, ANZIIF’s general manager of marketing and insights, says it’s important for the culture of an organisation to be ready for any program or initiative before implementation. She says, “While you may have buy-in at CEO level, by the time you get down to [the lower levels of an organisation], and

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someone who doesn’t really believe in it, the programs get lost.”

Leading the way Talking about organisations that are pioneers in their endeavours to redress the gender imbalance at work, Beattie mentions the Male Champions of Change and the WGEA’s employers of choice.

In 2014, the WGEA awarded citations to 76 organisations, recognising the increasing importance of gender equality to those organisations’ success and their ongoing work in this space. Of those 76 entities, two are insurance companies – Allianz and Suncorp.

Victoria Mackenzie-Andrew, Suncorp’s executive general manager of human resources, says the group began placing a strong emphasis on gender diversity back in 2011. She says several steps were involved in beginning the change at Suncorp. “First of all, we did a total workforce

review by gender … We looked at our diversity in our workforce and that meant we interviewed a number of different leaders by different levels and talked to them about their experience at Suncorp. We also did a comprehensive analysis on employment data by gender.”

Mackenzie-Andrew says the group also conducted a review of best practices and leading research to become aware of what other organisations were undertaking on this front.

“Once we finalised this, we had a really good view of where some of our gaps were and what we wanted to achieve,” she says. “We put together a plan to attract, enable and advance and retain female talent, and we also set ourselves a target that 33% of our senior leadership roles would be filled by women by 30 June 2014.”

Additionally, Suncorp established a group diversity council chaired by its CEO, Patrick Snowball.

Asked about the key challenges when the group embarked upon change, MackenzieAndrew mentions ensuring people consistently understood the need for, and the importance of, the business case. “There was also limited understanding of the cultural and structural barriers for women at work. We also identified that there was a lack of proactive career development for women.”

Today, Suncorp has a number of development programs in place aimed at developing female leaders, and also focuses on providing technical education for women. “We have a [quarterly] Women in Leadership networking event and we

ADVANCING WOMEN AT WORK Which of these changes do you think would have the biggest impact on diversity in your world of work?

Allowing more flexible working practices Changes in workplace culture through education across the business

44%

Highlighting female role models

32%

Changes to your organisation’s policy Changes to recruitment practices and policies Changes in government policy

32%

Better board backing for diversity issues Positive discrimination for women applying for management roles or above Introducing quotas

26%

44%

29% 27% 21% 9% Source: Hays Leading Women Survey

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FEATURE

GENDER DIVERSITY host events where other women, both internally at Suncorp and externally, come and talk about their experiences.

“We have strong sponsorship relationships at senior levels and we also facilitate attendance at industry events and conferences to make sure that that external networking occurs for women as well.”

THE 2014 ANZIIF WOMEN IN INSURANCE SURVEY

Women in Insurance ANZIIF’s Women in Insurance survey captured the views of women in 17 countries. Among the questions asked (and the survey responses) were those below:

79.8% I have a high level of confidence and self-belief

70% I want to take on leadership responsibilities

84.3% My relationship-building skills are excellent

74%

As a result of its initiatives, Mackenzie-Andrew says Suncorp has achieved some great successes.

It overachieved on its target of having 33% of its senior leadership roles filled by women by 30 June 2014. It currently has 38% occupying those roles. “We’ve experienced a huge uplift in employee engagement throughout the group.

“We’ve witnessed higher levels of innovation, and also our customer satisfaction levels are at an all-time high. I think these factors have been critical enablers for Suncorp, and [have] really helped us focus on building a sustainable business which delivers to improve returns for customers and shareholders.”

At Allianz, Niran Peiris and his team have also been working towards greater gender diversity in the organisation for several years. “As time’s gone on, we’ve given that a greater and greater focus,” he says. “We’ve implemented a number of things focused at attracting and retaining and developing women through the organisation.”

Peiris emphasises the importance of atoning from the top, “making sure that the organisation understands that it’s important to me and to my management team, and then … [working] from the bottom up to make sure it’s embedded in the organisation, so it’s not just us leading it every day and telling people it’s important, but people believing that it’s important”.

Allianz offers a sponsorship program for women, attempting to connect high-potential

I enjoy working on strategic planning tasks

Disagree Somewhat disagree Neither agree nor disagree Agree

“You need to think differently about how you tackle the issues”

Strongly agree

Victoria Mackenzie-Andrew, Suncorp

Source: 2014 ANZIIF Women in Insurance survey

FLEXIBILITY General insurance Percentage of organisations offering a compressed working week Percentage of organisations offering flexible hours of work Percentage of organisations offering part-time work Percentage of organisations offering telecommuting

All industries

62.5%

48.5%

95.8%

94.2%

95.8%

94.3%

83.3%

62.3% Source: Workplace Gender Equality Agency

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females with internal and external mentors, and an emerging female leader development program.

“I have a view that all talent needs to be navigated throughout the organisation, but the way you navigate different types of people is different,” Peiris says.

“In the case of a woman, you’ve got to acknowledge that their approach to career and the way they’ll go about doing it will be different to a male, and you’ve just got to facilitate a different pathway, if you like … But a good, talented male or female is equally capable of getting to a senior management position. For us [it’s about] finding those keys to how we best achieve that for them.”

In the broker space, Westcourt General Insurance Brokers today has women in almost every one of its senior management positions.

But, according to general manager Jenette Baker, its female representation across the network is owed simply to good hiring practices. “We engage people based on their capabilities and their knowledge, their skills and experience,” she says.

“It’s not been based on gender. It is just about engaging the right people for the right jobs.”

Lorinda Webster-Brooking, Westcourt’s Queensland state manager, agrees, describing Westcourt as an equal opportunity employer that hires based on skillset, not on gender.

“I think Westcourt senior management believe that a team with a diverse range of knowledge

and experience will lead to greater financial performance,” she says. “We’re currently seeing that from what’s happened in the first quarter already.”

Baker shares Peiris’s view that it’s important for senior managers to be driving the culture.

“You’ve got to have those at the top making sure that they live and breathe what they expect everyone else to do, and I think that shows within our team …”

Efforts from the top at Allianz have driven some impressive outcomes. Peiris reports that,

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last year, around 45% of Allianz’s job turnover was filled by internal vacancies, with 61% of those roles going to female candidates. He says the engagement level of staff is high for an organisation of 4,000 employees. “We have really strong return-to-work rates following parental leave. We’ve increased, over the years, the level of participation of women in senior management, and we are holding ourselves accountable to metrics going forward. We’ve worked quite long and hard on closing pay equity gaps, and closing those on a more granular basis.”

Beattie says a detailed gender pay gap analysis is an important component of addressing gender inequality at work. She says, “It’s a reasonably sophisticated analysis that doesn’t necessarily have to be overly complicated, and we’ve developed a whole range of free tools and resources to help employers do this work.

“We would say, unless you do this work, you cannot know whether unconscious bias is creating instances where women are paid less than men for doing the same or comparable work.”

GENDER COMPOSITION OF THE AUSTRALIAN WORKFORCE

51.5% Male 5.1% Part-time

9.4% 9.4% Casual male

48.5% Female

20.6% Full-time female

male

15.3% Part-time female

37.0%

Full-time male

12.6%

Casual female

Flexibility Both Allianz and Suncorp put a strong emphasis on flexible work arrangements. MackenzieAndrew says it’s Suncorp’s belief that the greater their ability to build a flexible workforce, the better their ability to retain strong female talent will be. She says 82% of Suncorp’s workforce currently works in a flexible way.

Peiris says offering a range of flexible working options is a key part of Allianz’s strategy. He thinks it’s important to also change some of the language used around flexible working. “People often say ‘I only work part-time’, and the word ‘only’ seems to connote that it’s something of less value than someone who works full-time or someone who works differently.”

Both Webster-Brooking and Baker have been able to take advantage of flexible working arrangements during their time at Westcourt.

Baker says a number of staff members have worked or are currently working under flexible arrangements.

Beattie stresses that, in addressing the gender issue, it’s important to understand the first thing that needs to be fixed is the workplace itself. “Employers and CEOs, in

Source: Workplace Gender Equality Agency

“In the end … [diversity is] just good for business” Niran Peiris, Allianz particular, need to stand alongside women and support their progression through the career ranks,” she says.

But she adds, “Critically, obviously, employees and women do have to play a role. Nothing happens without your own effort.

“I think it’s important that women firstly understand the barriers they do face in workplaces, and then work to overcome the barriers and hopefully find employers that are working with them to overcome [them].”

Beattie says it’s important for women to have an ongoing focus on their career ambitions, and to think about how they will get the support they need – both inside and outside of their workplace – to set themselves on the right path for that

career advancement. “[Find] employers that are willing to support talent, because there are plenty of them out there that are willing to support and nurture talented women, knowing the significant barriers they do face.”

Mackenzie-Andrew says, “I think we’ve learned over the years that CEO and executive sponsorship is a key success factor in driving sustainable change in this area. And there’s no silver bullet.

“You need to think differently about how you tackle the issues. It’s easy to say that it’s an industry issue and there just aren’t enough females out there, but successful organisations are the ones that find creative and different ways to work around those barriers.”

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FEATURES

FREIGHT FORWARDING

FORWARD THINKING In association with

Freight forwarding is changing – the legal landscape, the technology it employs and even what’s encompassed by the term itself. How should the insurance industry respond?

IT’S ONE OF THE LARGEST and most critical sectors of the Australian economy. It’s also underinsured.

The freight forwarding industry has undergone a substantial transformation in recent years, yet many of its players continue to have significant risk exposure. George Midas, managing director of Midas Insurance Brokers, says, “they’re not well-insured, especially the

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smaller players. They take what they must take to be either compliant or to give them some sort of comfort. The small to medium-sized [players] are very price sensitive… and they don’t look at the coverage.

“As brokers, we’ve got to be very careful what we say, how we present our paperwork, how we converse with [them] and how we correspond with them to make sure that we do our bit.”

Freight forwarders?

Even referring to specific players as ‘freight forwarders’ may now be inaccurate, as many entities move towards offering full supply chain solutions. Matthew O’Sullivan, head of marine, technical lead property and engineering at Zurich, explains, “where there were quite distinct customs brokers, freight forwarders, warehouse providers, distribution managers,

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Change According to Midas, the transport and logistics industry in Australia is worth more than $150 billion and represents in excess of 8.6 per cent of our GDP. Its efficiency is crucial to the country’s productivity and wellbeing.

Among other significant changes to the industry in recent years has been merger and acquisition activity, including Japan Post’s purchase of Toll Holdings, announced in February. “The smaller players are getting gobbled up by internationals,” says Midas.

“The internationals have also expanded their operations here…”

It’s also an industry now more educated than in days gone by, Midas says. The Customs Brokers and Forwarders Council of Australia, a peak industry body, offers a range of diplomas and industry accredited courses, and Australian customs brokers are required to adhere to continued professional development requirements. “I think the whole industry now is raising up in terms of professionalism because it has to,” says O’Sullivan. “It’s just becoming a much more professional industry because of the technological developments in the movement of goods, the increase in demand, and an increase in focus from the government on compliance.”

Technological changes have had a fundamental impact on heightened professionalism in the space. O’Sullivan describes forwarding in 2015

“I think the whole industry now is raising up in terms of professionalism because it has to” Matthew O’Sullivan, Zurich etc… the one company is now involved in many aspects of the supply chain; right the way from import/export…all the way through to distribution to the retail customer. That’s the kind of evolution we’ve been seeing over the last several years – the move to whole supply chain logistics management.

“You can even see that companies now are called ‘logistics operators’. They’re no longer called ‘so and so freight forwarders’ or ‘so and so carrier’. ”

as a “very high-tech industry”, adding, “if the players were still a guy sitting in an office above a shop handwriting all of his notes, they wouldn’t be able to compete.”

Compliance But perhaps the most significant development of all has been a government focus on compliance regulation. Midas notes that, up until about three years ago, the industry was poorly

MATTHEW O’SULLIVAN Matthew O’Sullivan joined Zurich Australia in January 2014 as head of marine, and technical lead of property and engineering lines across both its Australian and New Zealand portfolios.

Prior to this role, O’Sullivan was head of marine & energy for Asia Pacific at Aon Benfield, where he oversaw the treaty and facultative business for the Asia-Pacific markets – Australia, China, Japan, Korea and South-East Asia – based both in Singapore and in Sydney.

Prior to joining Aon Benfield in 2008, O’Sullivan spent over 16 years with Munich Re, in Sydney from 1991 to 2003, and then in the head office in Munich from 2003 to 2007. Whilst in head office, O’Sullivan was responsible for the marine and property business for key Japanese and Korean clients, and was a member of the Global Line of Business Board for marine.

O’Sullivan has published a number of articles and has presented at key industry events, including the 2006 and 2010 International Union of Marine Insurers (IUMI) Conferences in Tokyo and Zurich. He has served as chairman of the ANZIIF Marine Discussion Group; is a current member of the ICA Marine Standing Committee, and was an ICA delegate to the International Union of Marine Insurers from 1997 to 2003.

O’Sullivan has a Bachelor of Economics degree from the University of Sydney and a Masters of Business Administration from the Macquarie Graduate School of Management, Macquarie University. He is a Fellow of the Australian & New Zealand Institute of Insurance and Finance. regulated. “The government’s stepped in and said, ‘Look, enough is enough. You need to be responsible’. And there are some hideous fines now [for not doing] the right thing.”

From 1 February 2014, changes to the Customs Infringement Notice Scheme (INS) were rolled out. Those changes involved regulations aimed at tightening control of the supply chain, reducing

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FEATURES

FREIGHT FORWARDING revenue leakage and improving compliance. It’s sought to achieve those aims by issuing infringement notices, increasing penalties payable and introducing new offences that are subject to the INS. Penalties of up to $7,650 can be issued under the scheme, and it applies not only to forwarders, but to individual customs brokers, as well as customers and buyers and sellers who supply information.

O’Sullivan says, “the government [is] cracking down… saying ‘we want to close the loophole’ in what they believe to be revenue evasion or tax evasion… and to really police that area of the industry much more strictly.

“That’s one of the things the government’s doing and is one of the challenges faced by the industry… It’s compliance but it’s also about border protection really looking and focusing on this area of the industry to make sure that they’re absolutely collecting the right amount of revenue from the trade of goods.”

O’Sullivan thinks compliance regulation issues will remain a key focus for industry players in the near future. “I would imagine the freight forwarders and customs brokers themselves will be talking around the table, making sure their own compliance is in order. That would be a cost to their business they’re incurring now to ensure they are absolutely compliant in all ways that they can be.”

He says that with all of the development currently going on in the industry comes the need for insurance to also evolve by creating products “to encapsulate all of these additional potential liability exposures.”

Knowing the business And how do brokers help forwarders and ‘logistics operators’ deal with this continuing evolution and assist in addressing underinsurance?

“You need to get a fundamental understanding of what the business is of the insured,” says O’Sullivan. “Quite often, they can say they are freight forwarders, but they really have… an element of their business that is freight forwarding and then an element of their business is warehousing or whatever else. It would be for me [as the insurer] to get a real understanding of where their earnings are derived from.

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“They’re not well-insured… They take what they must take to be either compliant or to give them some sort of comfort” George Midas, Midas Insurance Brokers “Don’t just think because it has ‘freight forwarder’ or ‘logistics’ in its title as a name… that that is automatically what it does as a business model. It may have some other areas of the supply chain that are covers that you need to be aware of.

“As a broker, [you] need to be able to provide assurance to [your clients] that you can cover them for all their potential exposures… within that business model.”

Knowing when and when not to take on risk is also crucial. “We have a fairly robust client selection process,” O’Sullivan tells Insurance Business. “A lot of the clients that potentially could have less than acceptable practices… we wouldn’t even entertain them. And you can quickly see… those clients that are not ones we’d want get to involved with…”

Midas says, “we go out there and survey [potential clients] if we’re not happy with the answers that [they give us]. We check out their safety procedures, how goods are stored, and naturally their past history… I’ve got a vested interest [in] making sure that all the ‘i’s are dotted and the ‘t’s are crossed.”

O’Sullivan adds, “it’s not the insurance of a building, which is within physical parameters.

We’re quite often insuring them for contracts that they’ve engaged in… So [they] and the broker and the insurer and all parties need to really understand what it is about that contractual responsibility they’re absorbing.

“It’s not an off-the-shelf policy you can just hand to someone because there can be a lot of differences in the business model that’s underlying that insurance. That’s why I think some of the freight forwarders that just go for the stock standard package off-the-shelf do not get the cover for all their potential [exposures]…

“They need someone who can sit down with them and say, ‘by the way, do you realise

GEORGE MIDAS George Midas has been connected to the insurance industry since 1972 when he joined National Mutual Life as an agent, giving him over 43 years’ experience in the industry.

In 1979, he formed a general insurance brokerage under the name of Micol Insurance Services.

Midas joined Nacora Insurance Brokers in 1984 as part of a global insurance broking arm of Kuhne Nagel Freight Forwarding as managing director with responsibility for Australia and New Zealand. At this time, he set up a marine division to service the freight forwarding and transport industries.

In 1989, Midas acquired Nacora with a subsequent name change to Midas Insurance Brokers where he has been managing director and sole shareholder.

In building up the business, Midas further developed the company’s marine division to concentrate on coverage for cargo, freight forward liabilities and road house operators’ liabilities including charters liabilities.

With his extensive insurance knowledge and experience, Midas is recognised within the industry as an expert in the freight forwarders sector and a ‘go to’ person for brokers and customers alike.

that you could be drawn in for that? I mean, you’re sending cargo to a country that has a certain regime in terms of customs or fines or penalties’… If they don’t have that understanding, then they could equally be caught…

“We don’t offer this product at certain levels to all brokers because we recognise that not all brokers can deal with this business. You need to have an expert.”

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FEATURES

AUTHORISED REPRESENTATIVES

Authorised Reps:

BECOMING THE BOSS Two experts talk about potential rewards for ARs and the importance of doing your research before making the jump TWO YEARS AGO, Brisbane-based broker, Robert Cooper, told Insurance Business readers that, “being an AR is the most efficient and effective way to still be an insurance broker, while getting ‘back office’ support and [becoming] self-empowered.”

He added that provided a broker is organised, has a plan and is motivated enough, it’s “a recipe for great success and a much happier lifestyle”.

So what do those in the AR space in 2015 – the ARs themselves and those running the networks – have to say about the benefits of becoming an AR? Stuart Munro is the Queensland and Victorian commercial manager for Marsh Advantage. Fifteen years ago, he became Marsh’s first AR. Not long before joining Marsh, he’d sold his own small brokerage. “It was around when FSRA [Financial Services Reform Act 2001] was coming through,” he says. “I was looking for an opportunity to build a business but really wanted to get the backing of a large global, who had depth of resources and products.

“Now, some 15 years later, I jointly run the AR network in Australia for Marsh – still as an AR, of course.”

In the beginning Chandanie Godwin co-founded the Perth-based Winley Insurance Group’s AR network. She told Insurance Business about the process of building

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that network. “When we started the company, Jeff [Bailey] and myself went around Australia and, after putting out a marketing pack, met each and every one of those ARs interested in coming on board. That was an extensive trip across the country, going everywhere in a car, driving from regional town to the CBD.” Godwin says they spent six months on the road. “Since then, obviously we’ve grown a lot and we still try to meet the brokers who call us to express their interest in joining, wherever they are. The brokers who have been with us since we started the company really like what we do for them.”

Rewards Talking about the benefits for brokers and their clients that come about when a broker joins an AR network, Godwin cites the most immediately attractive benefit – the chance for a broker to become their own boss. “You can choose your own hours… You’ve just got to be able to balance everything… which gives you the benefit of spending more time with your family or doing other things that you want to do, as long as you’re highly organised and clearly focused on the goals you want to achieve.”

On what motivates brokers to join AR networks, Munro says most are looking for a higher income than their employee salary, and adds, “they’re looking for the flexibility to run their own business however they wish.”

“We’ll give you the opportunity and it’s up to you to build that business” Chandanie Godwin, Winley Insurance Group Clawing back time each day is another benefit Godwin sees for ARs who choose to work from home. “Working from a home office means you don’t have to be on the road for two hours a day.

That’s quality time that you can never get back.

“Time is everything, and becoming an AR gives you the option to work a lot more efficiently, I think.”

And with that extra time, Godwin says, comes the ability to offer clients better service. “I don’t believe there’s one AR within our group who doesn’t know their clients personally. It’s not like being given 250 clients or however many clients a broker or an account executive gets given

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working for a broking house, and they just do the renewal, renew and send the invoice out.

“ARs have to personally meet and go and speak with… and constantly have contact with their clients, which is a huge benefit for the client and the broker... I know technology and time moves on, but that client contact is still very, very important in order to gain their trust and also to keep that business opportunity going the following year and the next year… You’ve got to provide that personal service.”

Do your homework Munro thinks it’s important to emphasise that joining an AR network doesn’t guarantee success. He says it’s important for prospective ARs to do their homework before deciding to join a specific network. “What services does the AR network bring for the AR? It’s not just about licensing and providing a generous commission split. It’s about what does an AR network actually offer them... What support services and resources do they provide?”

“It’s not just about licensing and providing a generous commission split” Stuart Munro, Marsh Advantage Munro says he’s been able to grow a substantial business during his time with Marsh, but that he’s never had to do it alone. “It’s about how the network can help grow your business.

Does it provide marketing support? What are the products and services that complement your sales activity? What leverage in the marketplace do they bring? What back-office support do they get? What compliance do they bring to the plate?

All these add up to whether you’re part of a team or you’re just a loan AT working a network, which I think is important.”

Godwin points to the substantial financial rewards an AR can earn.

“We’ve got brokers who are earning millions of dollars…you can’t tell me that going to a job 8:30am-6:30pm is a better option than

becoming an AR and being your own boss.”

But at the same time, she emphasises that becoming an AR by no means constitutes taking an easy road. “We get brokers who come to us with a zero portfolio, who start from scratch.

And we give all those ARs the opportunity. We don’t say, ‘okay, you’ve got to have a portfolio this size and we give you a budget this size’. We say to you, ‘as long as you have the professional qualifications and you stay compliant… we don’t care whether you have one client or zero clients or 100,000 clients. We’ll give you the opportunity and it’s up to you to build that business. But you’ve got to have a goal and you’ve got to know how you’re going to proceed with it.”

And on just how much success an AR can achieve, Godwin says, “the sky is the limit, really.”

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FEATURE

CYBER SECURITY take, in relation to the technology they employ in their businesses, to help in safeguarding themselves against cyber risk.

Rising risks “Cyber risks are growing in any organisation hand in hand with the digitisation of the business and the increasing number of new technologies and sources of data utilised in day to day operations,” says Neklapil. “Insurance organisations are increasingly tapping into new data sources and integrating their systems with external providers such as banks, print houses and geo data providers, as well as utilising

GRATEX INTERNATIONAL

PROTECTING THE HOME FRONT How do insurance industry professionals protect their own turf from cyber-attacks?

In association with

Gratex International, founded in Europe in 1991, is a business systems solution house with offices in Australia and Europe. More than 350 specialists globally develop and support specialised business management software solutions for some of the world’s largest finance and insurance organisations.

Since 1999, Gratex Australia has been a leading business systems solution provider for the local insurance industry, providing software application development, cloud strategies and end-to-end IT services.

With a local team and local data centre, Gratex can provide end-to-end hosted services in a secure, reliable and fully managed environment.

Bringing insurance industry-specific Business Process Improvement experience, System Development and deep IT Managed Services expertise together in one agile team allows Gratex International to deliver exceptional service to insurance agencies in Australia and New Zealand.

UPM2 IN DECEMBER, one of Australia’s largest travel insurers, Aussie Travel Cover, was the subject of a cyber-attack.

It was subsequently revealed that 770,000 records held by the company were compromised in the attack. The stolen data included customer names, addresses and birth dates.

The Aussie Travel Cover attack, together with major data breaches recently suffered by US health insurers, Anthem Incorporated and Premera Blue Cross, have helped to ensure cyber-

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attacks remain a hot topic of industry conversation. But as awareness grows of the emerging cyber risk and the need for businesses to take action to minimise their exposure, these recent attacks raise the question as to how well industry participants are protecting their own territory.

Insurance Business spoke to Milan Neklapil, managing director of Gratex International, to better understand the potential exposures for industry professionals and the steps they can

Specifically designed for insurance agencies, UPM2 is a fully integrated business management system that automates workflows and improves efficiency. The software allows firms to focus on customer retention and business growth rather than underlying administrative processes. Developed in Australia, UPM2 is fully configurable and supports brokers and staff through every step of the insurance process. Modules cover everything from financial management and audit trails to customer relationship management (CRM) and reporting.

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document management systems to create paperless offices.

“While these services improve the overall offering to customers, they also create new exposures to cyber risks and business continuity.

Any breakdown in one of these links can seriously inhibit a business’ ability to operate.”

According to Neklapil, the complexity of keeping systems operational, available and secure becomes even more complicated because of users’ digital behaviour. He explains, “Remote access to systems and data through laptops, tablets and phones brings about new risks to businesses with individual users often unaware of the implications that web browsing, poor password management, a lost device, etc, can have. Controlling access to public services and applications can help protect company and client data but is ultimately a nightmare for risk managers.”

Neklapil says that, from a technology or software perspective, the key risks to which industry professionals are exposed are theft of data and exposure of customer data, disruption to internal systems utilised by staff and online client portals – which can significantly inhibit service offerings to clients – and fraud.

And those consequences, some of which can potentially be catastrophic, can be caused by one of many factors. Firstly, Neklapil cites ageing business applications and IT infrastructure with inherited security vulnerabilities, which are unable to withstand the latest cyber risks. He also mentions easy access to online applications and utilities by staff of an insurance company. “Missing or substandard functionality of the LOB (line of business) systems of an insurance company are often supplemented by a user using unapproved online applications and services of questionable origin and quality.”

Additionally, he raises non-existent or insufficient patching and maintenance strategies, inadequately skilled IT providers, failure to observe best practices in IT infrastructure and software development, and shortcuts being taken in architecture of security solutions (owing to a lack of knowledge or done as a cost saving measure).

Taking action As to appreciation of the risks, Neklapil says that the importance of the security measures required to protect company data is perceived to be “very

MILAN NEKLAPIL’S TOP FIVE TIPS FOR INSURANCE PROFESSIONALS TO MITIGATE THEIR CYBER RISKS

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Particularly in the SME segment, where businesses don’t have large internal IT departments, it is imperative to partner with a reputable organisation to work jointly to implement a cyber-risk mitigation strategy. Create, maintain and enforce security policies and constantly review them. Some third party IT companies offer network behaviour monitoring tools that create a baseline for normal activity and flags any future behaviour that is abnormal. Where this is combined with proper response strategies or even a Computer Incident Security Response Team (CISRT) to investigate and react to threats, it can be an effective tool for mitigating risk.

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Perform regular security audits and penetration tests. These are great for identifying potential threats and areas of weaknesses within a business. It is important to remember, however, that these tests only offer a snapshot of a business’ information safeguards at a single point in time. Information systems and the underlying technology operate in a very dynamic environment. It is more dynamic than we would like to admit and what is effective today won’t always be effective tomorrow. A security breach can occur in the blink of an eye and it is not uncommon for one to occur soon after an audit.

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Put in place an ongoing awareness program for your management and employees with focus on most common cyber risks, data protection, identity theft etc.

Categorise data from a security point of view and implement controls to limit who and how sensitive data can be accessed. Many new business systems are quite strong in this regard, with automated rules for who can access certain information.

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Be aware that the information technology world is changing rapidly on a daily basis and that security always needs to be front of mind to keep your business prepared. More data and information is available to us than ever before and this amount is constantly growing.

“A business’ reputation can be destroyed in a frighteningly short amount of time” low”, particularly in the SME segment. “Awareness of risks involved with digitisation of a business are misunderstood, underestimated and often ignored,” he says. “Security breaches occur on a vast scale. However, it is only the large issues we hear about in the media.” Neklapil says that can often make it difficult for management to fully appreciate the realistic threats to their businesses and take adequate steps to address them. “A small breach in security has the potential to greatly undermine the confidence of clients and in the age of social media, a business’ reputation can be

destroyed in a frighteningly short amount of time.”

So what are the key questions industry professionals should be asking of their IT providers, in order to ensure they’re properly protected?

Neklapil says there’s no simple answer to that question. “An insurance organisation can have any number of providers including hardware vendors, IaaS providers, ISPs, software development vendors, data retention providers, business continuity providers, internal IT staff etc, which ensure the business and its systems are running smoothly and effectively.” His advice is not to view those providers as simply service vendors, but instead as partners vital to the success of an organisation. “Ongoing communication will allow them to understand the changing needs of your business and you to be aware of changes in technology and new opportunities to protect the business.”

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PROFILE

KATE GREAVES

Adding oomph to insurance Goldsworthy Investments’ Kate Greaves reveals how she achieved outstanding growth in the family business during difficult times KATE GREAVES is the third generation of her family to run the Goldsworthy business, but her move into the top role, managing its general insurance arm, came much sooner than expected.

Greaves joined Goldsworthy in 2004, after working as a governess doing school of the air and while completing a Bachelor of Early Childhood. “[I] came in thinking I’d have a go at it and finish off my degree while I was here, and then found that I actually really loved it!”

But a year into her new career, as Greaves was still becoming familiar with the business, her mother, Katrina, was diagnosed with breast cancer. Katrina continued working full-time throughout her treatment, but was then diagnosed with cardiomyopathy in 2010. “She was basically forced into retirement immediately and I was told that I was the manager.”

Greaves describes the experience that followed as “an interesting rollercoaster ride”. However, four years on, Goldsworthy’s general insurance book has grown from $3m to around $6.5m in GWP. Not only has Greaves and her team succeeded in carrying on the 50-year-old business, but they’ve also managed to steer its general insurance arm to very substantial growth, for which they’ve received a number of accolades.

Goldsworthy is a part of the Resilium network of advisers, and since Greaves assumed leadership, it has twice won Resilium’s Fire Helmet Award. That award recognises the Resilium practice with the highest premium growth over the previous financial year. Greaves is the youngest woman to have ever won the Fire Helmet, the youngest person to have ever won it twice and Goldsworthy is the only single-owned practice to have won it twice.

“The first year we won… I felt that it was finalising a story that mum never got to finish,” says Greaves. “And then last year, winning it again, that was [my team] and that was me.”

Best practice How did the young educator-turned-authorised rep so swiftly achieve such significant accomplishments for Goldsworthy’s GI business?

“For us, [it’s about] working out your niche areas where you know you’re going to be able to sell well.

“We’re fortunate that we’ve got really sound referrals in place. But, in saying that, I never like to put all my eggs in one basket, and I’m always thinking about the next step.

For us, over the last four years, it’s really been setting in stone those referrals and taking our sales away from reactive sales and focusing more on proactive sales, and doing this together as a team.”

After assuming the managerial role, Greaves rebuilt her team over a two-year period. “I didn’t know what I needed and what I wanted from a team, and I had to go through a lot of really tough lessons… It was really, really tough with a young family.”

(She is mother to two children, aged seven and five, and her husband manages a 30,000-head feedlot five hours west of Brisbane.)

“Education is the key to your business”

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Oomph!

Once that team was in place, Greaves took inspiration from her mother in her efforts to bring its members together. “One afternoon, when mum was in here, she said, ‘You guys need a bit of oomph in here’. And I took that on board and, as a team, we decided to re-work the word ‘oomph’ into our team motto. We’ve actually got up on the walls in here what ‘oomph’ means to us…

“Each year, we as a team sit through it and go, ‘What is this meaning to us this year?’ That really helped us come together as a team.”

Greaves set about creating an environment for her team in which she’d want to work herself. “I encourage a happy, laughing, joking environment… I have an open door policy [and] make sure that everyone’s communicating what’s

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happening with their workloads and if they’re feeling like they’re not coping with what they’ve got… we can all chip in. There’s no such thing as, ‘It’s not my job!’ ” Given her successful endeavours to engage her workforce, how does Greaves feel other employers should focus their efforts to make their workplaces more attractive to new recruits?

“I’m a huge believer in recognition and reward,” she says. “As a team, we have to have a common [goal] that we all work towards and that we all want to be involved in. It doesn’t matter which part of the chain you’re working in, be it the top or the bottom, everybody has an input…

“For our team, I make sure there’s three different goals that we’re working towards annually which, as part of [our office] Olympics, are separated into gold, silver and bronze.

We were very fortunate the year before last that we got to our gold target.”

After achieving ‘gold’, Greaves flew her entire team from Brisbane to Sydney for a day out, drinks on the harbour and a degustation meal at one of the city’s top restaurants. “It was fantastic. I wanted something that was really special.”

Upskilling the workforce Greaves feels it’s also important to offer her team as many opportunities as possible to develop their skills. “I encourage all of my staff to go to professional development days and to conferences. Education is the key to your business… It’s really important that your staff is continuing to learn.”

Greaves is also eager to embrace her team members’ ideas for the business. Working with an HR company, Goldsworthy recently set up an innovations award for its employees. “We gave [our staff] six weeks where they had to come up with a new and innovative idea for the business… and they all came in and did their presentations and… the ideas that they came up with were just amazing!

There was not one idea there that we won’t be implementing. These were ideas that we would never have otherwise thought of.

“Being able to give your staff the chance to have these amazing, incredible ideas and be willing to back them on them, I think, is a great opportunity for staff, but also for us as a business…”

Reflecting on the successes, surely Greaves derives a great sense of satisfaction from the accomplishments Goldsworthy has achieved in recent years? “Most certainly, and to be a younger person and I guess, at the end of the day, female too… I know when I became a fire manager, I was the youngest to ever be appointed, and we as a company, we’re probably the oldest individually-owned practice with Resilium run by the youngest people.”

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15/04/2015 11:49:06 AM

BUSINESS STRATEGY

CUSTOMER SERVICE

CREATING A CUSTOMER DELIGHT CULTURE In an incredibly competitive business landscape, it is vital that you keep customers not just satisfied but delighted! In an extract from his book From Deadwood to Diamonds, Stefan Kazakis reveals how to wow customers – and keep them for years to come AS YOU know by now, a key part of the colour of your business is how you treat your customers. Without customers your business is nothing, even if you have the greatest products or services in the world. If people aren’t buying, you have an expensive hobby not a business.

So let’s have a look at how you delight your customers. Not satisfy, delight.

If you want your customers to come back to you time and time and time again, just meeting their needs is not good enough.

There are dozens, and maybe even hundreds, of other businesses out there that will meet your customers’ needs just as well as you can. It’s the minimum standard to be in business at all. To build a prosperous and sustainable machine that puts money in your pocket for years to come, you need to be proactive and think outside the square.

You need to keep getting better and be an innovator. You can’t simply wait until there’s a problem and then step in and help. You need to offer the solution to the problem, and more. You need to see the problem

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before they do. You should always be communicating with your customers and seeing what else you can do to help – there will always be something. If you run a gym, can you open up a small crèche to look after the kids while the parents do a workout?

If you’re a mechanic, start washing your customers’ cars at no extra cost. If you sell computers, throw in a free game with every computer sold so the kids can’t wait to get home and use it. Go above and beyond.

That’s how you delight your customers.

That’s how you keep them coming back.

If you own a restaurant, feed them! Have an abundance mindset; don’t have an attitude of scarcity. Give them an extra glass of wine. Keep bringing them bread throughout the meal. Bring a free bowl of chips for the kids. The small cost will disappear into insignificance when you start turning your customers into raving fans who come back to your restaurant time and time again and they also tell their friends.

Make a Customer Delight Culture a nonnegotiable part of the colour of your business.

Don’t just serve your customers, wow them!

Make sure all your staff have the same approach. Show them that you care, not with a fake smile and a voucher for $10 off next time but by genuinely caring and being interested. Play dumb and dig deep. Make them feel as if they are the most important customer you have ever served – because they are. Each and every client is vital to the ongoing success of your business.

A great question to ask yourself is, “How can I give my customers something more than they expect?” It’s simple but powerful.

And here’s the key to creating a true Customer Delight Culture: you need to think outside

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You can’t simply wait until there’s a problem and then step in and help.

You need to offer the solution to the problem, and more.

You need to see the problem before they do

the box when you answer this question. A crèche in a gym, washing cars for a mechanic and free games with a computer are great steps in the right direction, but they are just the beginning. What about giving your clients movie tickets, or a voucher for a restaurant, or sending flowers on their birthday? Business owners often look a bit surprised when I make these suggestions. It usually goes something like this: “But I run a gym; why would I give them movie tickets?”

I want you to have a think about this right now. Why would you give them movie tickets?

Do you have the answer yet? Think about it …

It’s actually really simple. You’d give them

movie tickets because they’ll love it! That’s it!

It doesn’t necessarily need to be related to your business. It doesn’t always have to be something they’ll expect from you or related to your products or services. Imagine if you signed up for a gym membership and you received a welcome letter that contained two gold-class movie tickets. Or you picked your car up from the mechanic and the tickets were sitting on the front seat. Wouldn’t you be blown away? Wouldn’t you tell your friends? I sure would.

The critical non-essentials matrix What are five things you can do for your

customers that are critical for them to be delighted but that are not essential? Let’s have a look at what I call the Critical Nonessentials Matrix.

Below are five random and surprising examples of what you can do to delight your clients. The key is the surprise element. If it’s not surprising it will become an essential and lose its impact. If your client expects something it won’t wow them nearly as much. So, give them a hand-written thankyou card thanking them for their custom and achievement; buy them movie tickets.

And don’t be cheap – get gold-class tickets; give them a free product or service upgrade

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BUSINESS STRATEGY

CUSTOMER SERVICE

EXERCISE: CRITICAL NON-ESSENTIALS

Make them feel as if they are the most important customer you have ever served – because they are.

Each and every client is vital to the ongoing success of your business or a voucher for a related business; take them out for a coffee, or lunch or dinner; send them a gift on their birthday (not a voucher for your business – this is not an opportunity to get another sale, it’s an opportunity to wow your customer).

Now let’s have a look at how each of these fits into the Critical Non-essentials Matrix.

If you have a look at the diagram you’ll see that we have ‘cost’ going from low to high on the vertical axis and ‘level of difficulty’ going from easy to hard on the horizontal axis. What you have to do now is fit each of these five bonuses for your customers into the matrix according to cost and degree of difficulty. You can see I’ve done it for the five examples.

Stefan Kazakis is a business strategist, sought-after presenter and speaker, and author of the new book, From Deadwood to Diamonds (Major Street Publishing, $29.95). He is a futurist and an inspiring communicator, with the voice of experience. For more information, please visit www.stefankazakis.com or email info@stefankazakis.com.

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THE CNE MATRIX $$ 5 Birthday gift

4 Lunch/dinner

2 Movie tickets

3 Free upgrade

COST

1 Thank-you cards

$ EASY

DEGREE OF DIFFICULTY

Prepare a list like this for your business. You can use these five, or you can come up with five other bonuses that you think will be more appropriate for your customers. It’s also a good idea to work out a timeframe over which these events will occur, so as part of your plan you need to work out what actions you are going to take over a period of, for example, six months. Then draw yourself a diagram like the one above, and insert each of these items in the appropriate place.

This matrix allows you to decide how you will use these five activities in your business. Thank-you cards are of course cheap and easy. Movie tickets

HARD

and a gift will probably cost a bit more but are also easy. A meal with a client takes a bit more effort, as does an upgrade.

Your low-cost and easy ideas must be done often. There’s no excuse not to do them. The more expensive and difficult things can be done when appropriate, but they must still be done. Don’t think of these as a cost; think of them as an investment in the long-term success of your business. And once you have this system and culture in place, don’t think you need to stop at five – keep going! Keep coming up with new and inventive ways to delight your current and future customers.

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BUSINESS STRATEGY

WELLBEING

Looking out for our mates: 6 signs someone is struggling and what to do about it

Look around you; are the people you work with happy and have a sense of wellbeing, or do they appear to be struggling?

Karen Gately urges everyone to look out for your mates and help reverse the alarming mental health statistics www.insurancebusinessonline.com.au

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BUSINESS STRATEGY

WELLBEING

GIVE SOME THOUGHT to the people you spend time with every day. Reflect on people at home, people you work with, service providers and any other person you regularly interact with. Reflect on their happiness and mental wellbeing; how sure are you that you know how they are? How well do you observe these people and see when they are struggling? We all have a role to play in ensuring the members of our community battling mental illness get the care they need, and it starts with seeing the issue.

According to the Australian Bureau of Statistics (ABS), depression and anxiety affect one in seven and one in four people respectively at some point in their lives. However, a staggering 65% of people with mental illness do not get the help they need. Every day at least six Australians die from suicide; a further 30 attempt to take their own life. According to Beyond Blue, at any one time approximately 20% of working Australians are mentally unwell.

Changing these numbers will mean each of us doing our part. We all need to take responsibility for looking out for one another and helping those in need. As employers we have a critical role to play in creating workplace environments that are healthy and supportive.

It is essential that people are encouraged and expected to behave with respect and compassion.

Every person irrespective of their role should be expected to take responsibility for having a positive impact on the wellbeing of the people they work with.

In Australia every employer has a legal obligation to provide a work environment free of risk to health and safety. This obligation extends to the mental wellbeing of people. In larger organisations, HR directors and teams play an essential role in ensuring people understand how the workplace can impact the mental health of the team, how an individual’s mental health can impact on the workplace and what can be done to promote awareness,

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respond to issues and provide support.

When consideration is given to the very real and detrimental impact of mental illness on the productivity and performance of a team, the commercial justification for making it a priority becomes clear. There is no doubt as to the extent to which people can focus their efforts, collaborate effectively, invest energy and make good decisions when mental health is optimal. Diminished work performance, morale and engagement, high rates of absenteeism, high staff turnover, accidents and workers’ compensation claims are costly consequences of mental illness for many businesses.

6 signs of mental illness Extended period of time feeling ‘down’

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something is wrong. Constantly feeling sad, down or miserable isn’t normal and an obvious indicator that the person may need help.

Depression is often also evident when people regularly feel overwhelmed, guilty, disappointed, irritable and frustrated.

2

Lost interest and resignation

Keep an eye on the person who no longer wants to do the things you know they love.

Losing interest in playing cricket, for example, may not simply be a case of moving on to new interests. Observe when someone has disengaged from their interests and resigned him or herself to living in a state of unhappiness.

When people are depressed they are more likely to put off work tasks, postpone appointments and give up easily.

Feeling depressed most of the time for anything more than a couple of weeks is a clear sign

PROPORTION OF PEOPLE AGED 16-85 WITH A MENTAL DISORDER (A) - 2007 % 50 40 30 20 10 0 At any point in their lives

In the 12 months prior to the survey

(a) Selected mood, anxiety and substance use disorders Source: National Survey of Mental Health and Wellbeing: Summary Results, 2007 (ABS cat. no. 4326.0)

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Becoming withdrawn

Withdrawing from close family, friends and colleagues is another sign someone is struggling.

For example, a colleague who in the past was keen to socialise suddenly having no interest in interacting with other people may well need support. While of course this example on its own isn’t enough to give you full insight into their mental wellbeing, it is all the insight you need to know it’s time to ask if they are okay.

4

Lost productivity

Take notice when someone who is typically productive starts to regularly miss deadlines and appear disorganised. Observe when people are unable to concentrate or become unusually indecisive. Being tired all the time may be another sign someone is struggling.

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Lost confidence and self respect

The way people talk about themselves can be revealing of the state of their mental health.

Look out for people who often say things like ‘I’m a failure’ or ‘I’m worthless’. Constantly hearing someone say ‘I’m sorry, it’s my fault’, particularly when they are not at all or only partially responsible, is a cause for concern.

People who are struggling often express their unhappiness by saying things like ‘nothing good ever happens to me’ or ‘I don’t see the point in trying’.

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Physical symptoms

Our physical health is unquestionably impacted by mental wellbeing. Feelings of stress, anxiety or depression have the potential to adversely impact our bodies. Headaches, sleep problems, loss or change of appetite and even significant weight loss or gains are telling indicators of someone who is struggling with depression.

Taking action Leaders play a particularly important role in

“Every person irrespective of their role should be expected to take responsibility for having a positive impact on the wellbeing of the people they work with” driving commitment to policies and practices, which promote mental health and ensure people are appropriately looked after. It is essential that HR teams work in partnership with leaders at every level of an organisation’s structure to ensure a consistent approach is adopted. Driving education initiatives, influencing a healthy workplace culture and providing support services are all essential roles HR must play.

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Educate

A lot of people are relatively uneducated about both the signs of mental illness and what to do when they become aware of it. Ensuring people understand how to recognise when they or a work colleague may be experiencing mental illness is an important way of tackling the issue.

Just as important is overcoming an all too common stigma associated with mental illness.

It’s a big issue that stands in the way of many people getting the help they need. Employers can play a role to shift the underlying attitudes that drive this stigma by educating their managers and team about the facts.

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Culture

Creating a respectful and compassionate workplace culture that inspires people to look after themselves and one another is among the most important ways an employer influences the mental health of their team.

Leading by example and holding people accountable for behaving respectfully are essential. The expectations a leader sets, coaching they provide and consequences they apply for the way people choose to behave has

a profound impact on the workplace environment created.

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Support

Talk about the issue. The more hidden mental illness remains, the more people will continue to believe that it is shameful and needs to be concealed. No matter the nature of our relationship with someone, we should never hesitate to ask how they are. Simply asking ‘are you OK?’ tells someone you care and invites him or her to talk to you. While of course it matters that we maintain appropriate professional boundaries in our relationships, acting with compassion when we see anyone struggling is simply the right thing to do. It’s not our role to diagnose or provide counselling but it is our role to assist the people we work with to get the help they need.

Karen Gately is a leadership and people management specialist and a founder of Ryan Gately. Karen works with leaders and HR teams to drive business results through the talent and energy of people. She is the author of The People Manager’s Toolkit: A Practical Guide to Getting the Best from People and The Corporate Dojo: Driving Extraordinary Results Through Spirited People. For more information visit www.karengately.com.au or contact info@ryangately.com.au

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15/04/2015 11:53:12 AM

BUSINESS STRATEGY

LEADERSHIP

Driving change: when to involve the troops Leadership is always a delicate balance, and knowing when to involve your staff in an important initiative is just one of these balancing acts – and the timing needs to be just right. In this extract from his book, Leadership: It’s a Marathon, Not a Sprint, Gordon Tredgold shares the perfect time to bring in support WHEN YOU’RE FIGHTING a battle, how long do you have to fight it alone? What’s a duel, and what’s a war? When should you call for reinforcements? When can you expect to find an army at your back? Someone asked me the question: At what point do we need to involve more people – like experts – when we’re shooting for those big goals?

This is an interesting and difficult question to answer. I see it as a very tough balancing act that we have to get right. If you involve too many people too early, then your goals run the risk of becoming tempered and watered down. On the other hand, if you involve too few people or involve them too late, people might feel excluded and this can then lead to resistance, tension and lack of commitment. That can be a huge source

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of conflict. In my opinion, the team defining the objectives and the goals needs to be small.

And by small, I mean perhaps one to two people.

I’ll explain why I’m so conservative with that number. The more people you have involved in defining the goal, the more reasons they’ll provide you as to why you cannot hit your target.

(It’s more ‘natural’ to think initially of what could go wrong. Remember when someone turned up late for a date or a meeting? A dozen bad scenarios probably ran through your head – from he doesn’t like me anymore to maybe he got into a car crash. Turned out, he’d just stopped to fill up with petrol.) If there are too many people involved, your goal will be watered down from big, bold and beautiful to small and not-so-impressive. It’s nobody’s fault, per se;

it’s just the way of people, for there are as many opinions as there are voices. In the end, it’s your decision, and your voice has to make the choice.

We need to be dedicated and fearless when setting big and ambitious goals, and this is more easily done if we only have to deal with (or convince) a small group. Large groups tend to be more cautious, argumentative and often lean toward the safe side – not what you need when setting big, bold goals. You need healthy doses of risk, ambition and creativity, and those characteristics can get trampled by the masses.

I’ve experienced this in the workplace time and time again, like that time when I set one company’s goal for an on-time delivery increase to 80% (as compared to our old average performance of 35%). If I had consulted with a larger group, I am sure we would have tempered the goal and probably set it at 60%; 80% wouldn’t have even been considered, much

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you can begin gathering an army to tackle how.

Remember this: The goal is non-negotiable now. There will be those who will try to deter you from it. There will be those who won’t be able to fathom the big picture. But the team’s focus should be on brainstorming and mapping out the road to success. The vision of success has already been taken care of. All the energy must now be channelled to discovering how to achieve the bold goals – not how to temper or reset them.

The three key principles to driving change are:

“If you involve too many people too early, then your goals run the risk of becoming tempered and watered down. On the other hand, if you involve too few people or involve them too late, people might feel excluded, and this can then lead to resistance, tension and lack of commitment” less reached.

In my opinion, keep the team to a minimum when you’re at the first step of defining success and setting the goals for a change.

So then, the second step. You have to define the why behind the what: why this goal is

important, what the benefits are, the reasons behind it and so forth. The more inspirational the goal, the more convincing your why – and the bigger the buy-in.

This is when more people begin to show up.

As soon as what and why have been defined,

• Define the problem (the goal) with as few people as possible • Create an important and inspiring reason that people can buy into • Define the solution (the strategy for success while involving and welcoming more people – the troops) There will always be some resistance, of course. You need to see beyond that now. The Chinese have a popular proverb: It is better to light the candle than to curse the darkness.

Problems exist to be solved. Your vision must be powerful enough, and your focus must be just as keen. Don’t ask your team: Why shouldn’t we do this? Instead, ask your team: Tell me what you need to make this happen.

If you can attain the balance, your larger group will not feel excluded. Instead, those people will feel involved. They will take up the challenge and work with you to define the solution. After all, the resulting solution will be their brainchild, too, and involvement breeds commitment. Thus do we set big, bold, challenging goals, while inspiring people and ensuring their commitment.

Gordon Tredgold is a specialist in transformational leadership, operational performance improvement, organisational development, creating business value, and program and change management.

www.insurancebusinessonline.com.au

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15/04/2015 11:53:35 AM

SMEs

STATISTICS

A BROKER’S GUIDE TO SMALL BUSINESS A new Vero report provides insights into the challenges and opportunities that lie ahead for brokers SMALL AND MEDIUM businesses have long been a staple client of the broker but new research by Vero could show a changing of the tide for the industry.

The Vero SME Index 2015 takes an in-depth look at the use of brokers from small businesses and, there are causes for both concern and optimism from the broker perspective.

While it may appear that brokers are beset from all sides with increased competition, the Vero Index shows that the broking community still has a place in small to medium business risk. However, there are several key metrics that a broker can use to not only survive in the world of SMEs, but to thrive.

Source: The Vero SME Insurance Index 2015

PRICING TOP OF MIND FOR DECISION MAKERS

How much your broker contacts you...

37% of clients note that they received cheaper prices when using a broker

BROKER-CLIENT SATISFACTION IN 2014

BROKER CUSTOMERS ARE SATISFIED, BUT LIKE MORE COMMUNICATION Actual contact

Satisfied 68% Somewhat satisfied 23%

Preferred contact

Once a year or less

45%

37%

Twice a year or more

55%

63%

Neither satisfied nor dissatisfied 6% Dissatisfied 3%

Only 24% of clients say that their broker keeps them updated about insurance issues

YOUNG, FEMALE BUSINESS OWNERS OFFER AREA OF GROWTH 54% of business owners perceived a higher price change last year, with 60% thinking prices will rise again in 2015

Of business owners that use a direct insurer, 41% said they would use a broker if the broker could secure cheaper prices up from only 25% in 2012

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Male 18-39 y/o

36% 43%

Male 40+

46% 54%

Female 18-39 y/o

42% 36%

Female 40+

45% 52% 2013

2014

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THE NEW GENERATION OF BROKER USERS New clients (less than 3 years): Age 40+ = 63%; 18-39 = 37% Long-term clients (over 3 years): Age 40+ = 86%; 18-39 = 14% More than two-thirds of those surveyed have used a broker for more than three years 44% of SME clients use a broker, down from 50% last year 57% of clients say they use a broker to save time 60% of business decision makers over 40-years-old personally researched their own insurance, with 54% using the internet to research their options

BUSINESS SIZE HAS EFFECT ON BROKER USE Size of business

2013

2014

1–4 employees

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36

Change in %

Down 7%

ONLINE AND REFERRALS KEY TO NEW BUSINESS Sources used to find a broker 100%

75%

50% 5–19 employees

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20–199 employees

50

45

45

Down 3%

Down 5%

25%

0%

60%

39%

35%

19%

17%

14%

12%

8%

Online search

Colleague/ friend/ family

Business advisor (e.g accountant/ lawyer)

Association/ industry body

Chamber of Commerce/ Local business association

Other search (e.g Yellow Pages)

Advertising

Social media

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15/04/2015 11:54:12 AM

PEOPLE

SOCIAL LIFE

SOCIAL LIFE

Brokerage CEO raises over $650,000 for charity on Antarctic expedition

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John Elliott, CEO of Elliot Insurance Brokers, recently joined a number of Australia’s brightest professionals on a journey to the southernmost continent. In doing so, he succeeded in raising $651,000 for charity, Health Hope Zambia.

Elliot’s Antarctic trip was with The Unstoppables Movement, a group founded by Brazilian businessman, Julio De Laffitte, aimed at bringing entrepreneurs together to raise Australia’s financial intelligence through collaboration.

Health Hope Zambia was founded in 2011 by Elliott’s friend and Perth businessman, Brendan Clark. It provides health care services in rural Zambia through mobile medical clinics, school feeding programs and outreach programs.

Insurance Business offers Elliott a huge congratulations for this outstanding achievement.

15/04/2015 2:14:19 PM

UAC kicks off 2015 Australian expos Following a successful inaugural event in Auckland, UAC and NIBA bought exhibitors, brokers and other industry professionals together for the Hobart and Sydney expos. Hobart had its turn first, with attendees taking to the city’s Grand Chancellor Hotel. Later in the month, Sydney’s salubrious Hilton hotel housed the harbour city event, with 65 exhibitors and more than 300 brokers filling the exhibition space.

Attendees at the Sydney expo lunch had the added pleasure of listening to guest speaker and Victoria Cross recipient, Corporal Mark Donaldson, who received the highest award for acts of bravery in wartime for saving the lives of fellow soldiers during battle in eastern Afghanistan in 2008.

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15/04/2015 2:14:33 PM

FAVOURITE THINGS

NICOLE MELLICK

Director, business development, GSA Insurance Brokers Sunrise walks on the beach, Sir Richard Branson’s autobiography and Ed Sheeran’s latest musical offerings - these are a few of Nicole Mellick’s favourite things Best thing about working in the insurance industry: The great people you meet along the way

Favourite holiday spot: Santorini, Greek Islands - very picturesque What’s on your playlist?: I am listening to Ed Sheeran’s ‘X’ right now and love the whole album

Favourite book: It is a luxury for me to get to read books. I like to read biographies. It would have to be Sir Richard Branson’s book, Losing my Virginity

Favourite sport: I like tennis - playing and watching it

Favourite indulgence: A morning walk on the beach at sunrise in summer

Best day you’ve had working in insurance: Being appointed to a large association last year that I had been chasing for over three years. These are ones that make it all worth it

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Favourite film: Tough one... but just watched E.T. with my kids recently and realised what a cool movie it was for its time!

Favourite advice: ‘Don’t judge a book by its cover’

NIBA/Studio Commercial

15/04/2015 11:55:16 AM

REACHING NEW HEIGHTS IN STRATA INSURANCE QUS and AIG have partnered together to deliver superior value and stronger support to strata insurance brokers.

This new partnership with AIG enables QUS to provide even stronger support to the Australian broker market, through an increase in risk capacity and location appetite.

For more information on our new product enhancements or for full details regarding this switch, visit www.qus.com.au.

1300 814 011 www.qus.com.au AFSL 321877

In Australia, products and services are written or provided by AIG Australia Limited ABN 93 004 727 753 AFSL 381 686. Not all products and services are available in all jurisdictions and are subject to actual policy language and underwriter discretion.

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