General Insurance review

Stay home, keep gardening – but make sure you stay insured

Geoff Hall

chairman, Berkeley Alexander

It is perhaps unsurprising that 47 per cent of UK households invested in their gardens during the two-summers-long pandemic, according to price comparison site GoCompare. We spent an average of £1,976 each sprucing up these essential extensions of our living spaces with big-ticket items such as garden furniture, fire pits and pizza ovens, sheds and summer houses, and even hot tubs and pools.

But have we invested as much time and effort in making sure that those outdoor acquisitions are adequately protected? The answer is no – at least according to defaqto. Their analysis suggests that insurance cover for contents left in the garden has not kept pace with modern living.

As the staycation trend continues (especially with the current airline chaos), it’s time to up the ante to ensure your clients understand the true value of their outdoor items – and the need to protect value.

According to defaqto, one in 10 home insurance policies has no cover for contents left in the garden, and those that do typically have low limits (£1,000 or less with no option to increase). But there are policies out there for those who do need additional protection, and that’s why the advice of a good broker is invaluable.

Speak to your clients, evaluate their individual requirements, and if you ascertain they need a higher limit then speak to your general insurance (GI) provider about the options available. There are options out there to give your clients the cover they need; sometimes you may just need to look past your normal go-to provider.

Also, be aware that hot tubs and pools that are “permanent fixed items” (typically wired or plumbed in) are not generally classed as garden contents; they generally come under the rubric of buildings, so again, make sure these structures are adequately covered under the policy.

ENHANCED GOVERNANCE A BURDEN? REFERRALS ARE AN INCREASING LIFELINE FOR AGENTS

Fair value, pricing rules, and other compliance requirements help ensure you consistently secure appropriate cover, at the right price, and that it is reflective of the value you provide to your customers. But let’s be honest – they are also placing a heavy burden on your time.

There is no denying that governance plays a vital role in maintaining a healthy insurance ecosystem. However, the burdens of increasing regulatory and compliance demands are taking a toll. According to BIBA, one in four employees in smaller firms is now focused entirely on regulatory matters, meaning any knock-on effect on your ability to deliver the high level of service you desire, and every client deserves, could be significant. But there is another way.

Have you considered referrals? Referrals to a GI provider enhance the opportunity to reach more customers with a wide range of policies, whilst taking advantage of those providers’ strong relationships with major insurers and ensuring the right cover at the right price. They still provide you with commission and a regular income, whilst taking that onerous regulatory burden off your plate.

Every week seems to bring a new reminder, a new proposal, or a new warning from the FCA. Speak to your GI provider about the referral options they offer, and you may no longer have to suffer the insurance regulation challenges.

DON’T FORGET GI – IT COULD BE A VITAL SOURCE OF INCOME IN THE CURRENT ECONOMIC CLIMATE

Inflation is on the rise, and we are all feeling the pinch of the cost-of-living crisis. The availability of housing stock appears to be declining, and the chances are therefore that your income will, too.

No wonder almost half of advisors (48 per cent) in a recent poll say that general insurance sales have become an important source of income. And yet, three in five advisors (57 per cent) are still missing opportunities to offer GI.

I would argue this is especially true when it comes to missed commercial GI opportunities. Believe me – there are opportunities out there. Earlier this year, my team here at Berkeley Alexander secured a £140k commercial motor fleet following a referral from an advisor, and recently renewed a £90k commercial property portfolio, with those advisors earning a valuable and welcome commission. These larger cases don’t come across your desk every day, but they are out there if you look for them. But it’s not just those big wins – you are quite likely to have a raft of existing clients who have commercial or investment property insurance needs, and they all add up.

I understand that GI sales can seem complex, perhaps due to the regulatory challenges mentioned earlier or simply because insurance might not be in your wheelhouse. But you can maintain this vital source of income. Make it a habit to introduce your clients to your trusted GI provider; you’ll receive a valuable commission whilst adding value for your clients and helping ensure they remain loyal. M I