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The new normal

As the industry continues to adjust to the ‘new normal’, and as more of us return back to office-working, Steve White, Chief Executive of BIBA, talks us through some of the key changes and challenges to be considered as we move forward. 

 Socrates (the philosopher, not the Brazilian international footballer of the early 1980s) is quoted as saying: “The secret of change is to focus all of your energy, not on fighting the old, but on building the new”. As business life starts to focus on a ‘new normal’ (building the new), what ‘normal’ might look like differs considerably depending upon where business is situated, what it does, how it does it and its appetite to do things differently. 

have been speaking to broking business owners and leaders of all shapes and sizes over the last few months and so have heard first-hand how businesses are wrestling with the ingredients of a different normality and their journey to this ‘new normal’. Many have said that they are very mindful of striking the right balance between the safety and wellbeing of their staff and the economic realities of running their business. It is a delicate balance that, as Chief Executive of BIBA, I recognise as we are, at the time of writing, finalising our own return to officeworking plans. 

In the latest edition (Issue 44) you can read an article by Covéa on HR and wellbeing, which I don’t want to either replicate or contradict, but clearly it is important for businesses of all sizes to take their staff with them on the journey to the new normal. As a business based in the City of London, one of the key considerations for BIBA’s planning has been the issue of commuting and people’s willingness, or otherwise, to use public transport, sometimes for lengthy journeys, as a means of getting to the office. Interestingly, during the health and safety inspection we arranged as part of our return to the office planning, it was recommended to us that we should not encourage staff to use public transport!  

One of the major learnings of the Covid19 lockdown has been how well certain functions can and have performed remotely. A good number of brokers have told me how surprised they have been at the completely seamless way certain functions have transitioned from being performed in the office to being undertaken remotely. Now, clearly, some types of function and process better lend themselves to remote fulfilment than others. There is some consensus that the more repetitive tasks are perhaps better suited to remote working than some of the more intellectual ones. That consensus contends that for these more intellectual or collaborative-type tasks, being in a face-to-face environment allows the optimum discourse between colleagues needed for best results. The use of Microsoft Teams, Zoom, Webex and other remote meeting applications during this period of remote working has demonstrated to businesses, large and small, what can be done highly effectively, but as firms plan for a new normal, they are reflecting on the lessons learnt and taking the best of these learnings into their forward planning. 

Having decided what tasks are better done where, businesses obviously have had to consider also which tasks are best done by whom. Staffing considerations are a major factor in planning for the new normal. As we move along this road, I’ve seen many examples of polarised views on what a new pattern of working might look like. Some staff have taken the view that they are working well and efficiently remotely and would like to have the flexibility to continue, either full-time or at least in part, not in the office workplace. Others, on the other hand, have been keen to return to work with colleagues in the workplace, although I hear that in some instances, returning to offices with one-way walking restrictions, face masks, social distancing and separation between work stations has put some off and led them to return to working remotely! Employers of course have to balance this with the needs of the business and their abilities to monitor, supervise and motivate their teams. 

Another telling and relevant quote from Socrates is “beware the barrenness of a busy life”. Many brokers with whom I have been speaking tell me that the last six months has led them to reflect on their work/life balance, and I’m sure this is true for many people. One of the most common challenges of home-working can be the blurring of demarcation lines between working time and personal time, with many employers reporting that ‘production’ has increased during this period, a result perhaps of a mixture of fewer interruptions but also of possible longer working hours. As we move towards a new normal, many people will take stock on what works for them, their work/life balance and importantly, for their employer, and adjust accordingly. 

Reflecting on the above, I think we can see enough different moving parts to suggest that what ‘normal’ might look like going forward will be a kaleidoscope of styles and approaches, but what will not change is brokers’ focus on providing the same (or more) broad range of services to their customers and clients. The new normal we are approaching comes with other changes and challenges so let’s take a look at some of those. 

One of the bastions of the ‘old normal’ was the underwriting room at Lloyd’s of London. Lloyd’s itself has obviously undergone many changes since emerging from a coffee shop on Tower Street in the City of London in the late 1600s, but its decision to introduce a ‘virtual underwriting room’ to sit alongside the traditional room marks a significant change in the way it is prepared to do business. As a number of brokers have pointed out to me, if Lloyd’s can effect such major change to the way it works then we really could see similar seismic changes across the piece. 

At the start of 2020 it would have felt very strange to pen an article on the future without giving early mention to Brexit but, here we are, nearly 1,000 words in before raising an issue that is going to change the way of working for many brokers and others in our sector. As I write this, the negotiations around a possible future free trade agreement are reaching the critical stage. However, there is nothing in the offering that gives any comfort to insurance brokers – indeed any deal will, in all likelihood, be a ‘no use to us’ deal. Brokers have known for some time that to continue servicing their EU-based customers with EU risks post 31 December 2020 they need to obtain an EU authorisation and this is not something that can be achieved overnight. For those with significant EU exposures, the steps have largely been taken, but for many there is still likely work to be done. 

Insurance brokers have been aware for some time that certain markets were starting to harden. The pandemic has accelerated that hardening. At BIBA we have had Governmental discussions on trade credit insurance which have led to the Government stepping in to take 90% of the risk. We have also had several discussions with the Ministry of Housing, Communities and Local Government regarding professional indemnity insurance for fire surveyors and fire insurance for multi-floored clad buildings. Sectors such as care homes, film and production, brokers own professional indemnity, and even single business cars, are becoming problematical. One of the consequences of the market hardening after many years of ‘softness’ is that a generation of account executives and account handlers have little experience of having that difficult conversation with their customer, i.e. explaining why costs are increasing and, in some situations, why restrictions have been imposed and perhaps excesses increased.  

It’s clear that despite Government assistance, some businesses will struggle to survive and many that do will have their business confidence badly affected. Certain sectors are likely to be worse hit than others (the entertainment and leisure sectors are being spoken about as being particularly vulnerable) so brokers may well have to adjust their focus and seek new areas of development. This ‘crisis of confidence could give brokers the chance to once again demonstrate their value to customers by doing what they do best – discussing needs, giving advice and offering choice.    

Finally, we return to our people – our staff. A new normal will inevitably feature new methods and ways of working and the will, support and enthusiasm of all involved to make it a success. From BIBA’s perspective, I’m following the advice of Barack Obama, who said: The future rewards those who press on. I don’t have time to feel sorry for myself. I don’t have time to complain. I’m going to press on”.  

So, with that said, let’s press on! 

Steve White is the Chief Executive at the British Insurance Brokers’ Association (BIBA).