Talent acquisition is the top broker concern for 2024, with 69% saying it’s the channel’s biggest challenge, Canadian Underwriter’s 2024 National Broker Survey shows.
After that, a cluster of other industry conundrums keep Canada’s brokers counting sheep. Coming in at second and third, each with 54%, are concerns about economic issues like inflation and rising interest rates, and growth of the direct-to-consumer sales model.
Last year, economic issues made only 44% of brokers queasy and direct sales worried 51%. Both are now showing up higher on brokers’ radar. The annual CU survey is sponsored by Sovereign Insurance.
Even with this year’s increase to 54%, concerns about direct sales in 2024 remain below pre-COVID levels. Back in 2020 (the survey was conducted before the global pandemic was declared), 62% of Canadian brokers had an eye on their competitors in the direct channel.
But even after the pandemic highlighted the broker value proposition of providing consumers with choice, advocacy and advice, comments in our 2024 broker survey show the rancour remains.
“Direct writers have [an] advantaged playing field,” says one verbatim comment to the survey. Another expresses frustration with insurance companies’ use of “direct-line selling [while] at [the] same time telling brokers that they are important to the company.”
Broker concerns about the hard market — last year’s Number 1 challenge to the channel — have tailed off. Only 53% of respondents in the 2024 study cite it as their primary worry. That’s well below 2023’s 66%, 2022’s 76% and 2021’s 74%. Percentages aside, though, verbatim responses articulate specific challenges.
“It seems that premium increases and finding better rates for clients who are already insured with certain companies have become more challenging,” one respondent says. “Just a year ago, it was often possible to find better premiums, but now, when using quoting software, the quotes can sometimes be twice as expensive.”
Some blame may fall to uninformed consumers. One commenter says insurance customers still show a “misunderstanding of the value proposition for online/digital insurance and call centres, versus [a] personally accountable broker/agent) relationship.”
Closing 2024’s Top 5 list of broker challenges is worry over insurance industry consolidation. This concern has been statistically flat for the past five years – 50% in 2024, against 48% in 2023; 50% in 2022; 47% in 2021; and 46% in 2020.
This article is excerpted from one appearing in the April-May 2024 print edition of Canadian Underwriter. Feature image courtesy of iStock.com/jabkitticha
