Q. Has the industry changed drastically since you started working in it?
A. In some ways yes, in others no.
Technology has created massive changes in the way we work and how insurance is bought and sold. It’s made us faster, more efficient which in turn has increased customer expectation. It’s also now offering the potential to mitigate risks – water leak detectors for example.
The word ‘insurtech’ didn’t exist when I first started in insurance – now these businesses are making incumbents look long and hard at their business models and we are starting to see some interesting partnerships.
As an industry, we are much more heavily regulated than when I first started in the market and there has been significant market consolidation through M&A activity, which shows no signs of abating. We are a good example of this activity, now being part of the Markel family.
There has been a rise in fraud driven in part by a compensation culture that has emerged in the UK. Also, the risks we are dealing with have changed. In our area of the market which is specialist contractor insurance, advances in building materials, building methods and strengthened health and safety regulations have helped to improve safety records – although worryingly these seem to have plateaued in recent years. The Health and Safety Executive released data showing a 27% increase in construction fatalities in the past year. Maintaining health and safety standards is becoming ever more important.
Where I think there has been little change is in the relationships with brokers. One to one support of brokers serving the contractor market has been and remains the bedrock of our business. This is an area we have really looked to grow since becoming part of Markel International. Our new partnership with the Cobra Network to deliver bespoke contractor cover is going from strength to strength.
Q. What has been the key positive or negative impact of change in your area of the market?
A. The health and safety culture that’s now embedded in many contracting businesses has been a hugely positive change but there is still a lot of room for improvement and the HSE’s annual workplace fatality statistics will attest to this. The fact that construction fatalities have increased in the past year should act as a wake-up call to the sector.
While price comparison sites have made it easy for us to shop for our personal insurance, selling SME insurance online is not right for every type of risk. It’s understandable in the micro SME sector, that customers want the same, streamlined experience when they buy their commercial cover as they do when buying home and motor insurance but for the types of specialist risks we underwrite, the value of the broker in ensuring the cover is right for the risk, cannot be overstated.
We know that in the drive to cut costs, specialist contractors may be looking for cheaper insurance deals from non-specialist providers online. However, it is vital that they seek advice from their broker to ensure that they have adequate and appropriate cover.
Q. Who inspires you and why?
A. The England cricket team! (Or maybe they were lucky).
I find lots of different people inspiring. For obvious reasons, Stephen Hawking was truly inspiring. Ethical leaders of any kind, not just in business, are inspirational. Sadly they are a bit thin on the ground but anyone who succeeds while retaining their honesty and integrity is a great inspiration. There is nothing worse than finding out that someone you admire is not who you thought they were.
Q. Have you had/got a mentor? If so, what was the most valuable piece of advice they gave you?
A. I consider myself very fortunate to have had several mentors, business and otherwise, over the years. The best advice I have had from all of them was ‘stick with it’. So I am tenacious! That can be a strength and a pitfall on occasion. What baffles me is people who give up when they are 90% there!
Q. If you were not in your current position, what would you be doing?
A. Possibly a job outdoors or something to do with motorbikes! I have five motorbikes and four pushbikes – I like to be active and outside in my downtime.
Though the novelty could wear off quite quickly!
Richard Forrest Smith is the CEO of ECIC.
Read More; Darren Mendel | Partner | Horwich Farrelly