4 March 2015 Insurance

Generalist brokers are dinosaurs, claims Aon Benfield boss

The old adage of ‘in a soft market you want a consultant, in a hard market you want a broker’ is simply not true anymore, Eric Andersen, CEO of Aon Benfield, told delegates at the Economist’s Insurance 2015 event yesterday (March 3).

“We have gotten to a point where the generalist is a bit of a dinosaur. Everyone has to bring something to the table,” he said.

“The role of the broker has evolved. It’s become more and more of a risk management role and less of a risk transfer role. Historically, brokers used their skill set to transfer risk. What often happens now is that the risk management portion of work is done for its own benefit.

“A third of the broker’s capability is built around helping the customer understand the risk they face and how to manage it,” he added.

Andersen explained that firms that have become more transparent have become stronger in their capabilities and interactions with clients.

“When you actually sit with the customer, what was coming back to us is that we need more consulting services and we need more understanding of our risk with less around the transaction. There’s been a metamorphosis of the capability of the global brokers on the skills that they have and you can tie it back to the transparency regulations that have come out,” he said.

“Transparency has been a very positive thing for the industry, certainly more for the brokers than anybody else. It has allowed us to realign resources and the capabilities that we bring to the marketplace to align to what the customer finds valuable.”

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