Is on­line in­sur­ance

CityPress - - Business -

Hav­ing more than one prod­uct with your in­sur­ance com­pany will also lower your pre­mi­ums. In my case, only my car is in­sured through the di­rect in­sur­ance provider, while my house and house­hold con­tents are in­sured through the in­sur­ance bro­ker, hence a fur­ther dis­count on pre­mi­ums.

Coutts ex­plains that in­sur­ance com­pa­nies re­ward you for hav­ing more in­sur­ance with them, be­cause it low­ers the over­all risk and in­creases the lev­els of re­ten­tion.

So, if the real pric­ing dif­fer­ence has less to do with the chan­nel I am pur­chas­ing in­sur­ance through and more to do with my risk pro­file and num­ber of poli­cies, which dis­tri­bu­tion chan­nel works best?

For in­di­vid­u­als who want to be able to go on­line and in­sure their car and have no need for a bro­ker re­la­tion­ship, on­line in­sur­ance def­i­nitely fills a space.

I have house­hold in­sur­ance and a two-car fam­ily (which will soon be­come a three-car fam­ily when my son starts driv­ing), so, all things be­ing equal, I pre­fer the bro­ker model, es­pe­cially when it comes to the claims process.

One of the ad­van­tages of a com­mis­sion-based struc­ture is that the bro­ker is paid on an on­go­ing ba­sis to ser­vice the client. It is in their in­ter­est to en­sure that the com­pany pays out if I have a claim, be­cause an un­happy client moves on.

A large in­sur­ance bro­ker­age has a lot more clout with an in­surer than I would as a sin­gle client, so it is more likely that my claim would be pro­cessed and, best of all, it means I don’t have to deal with a call cen­tre any more.

Num­ber of poli­cies af­fects pre­mi­ums

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