Insurance Adviser December 2021/January 2022

DECEMBER 2021/JANUARY 2021 2022

#NIBA2021: IT IS LIKE NOTHING YOU’VE EXPERIENCED BEFORE PIVOTING BACK INTO ACTION The global supply chain segment

UNITED PROACTIVITY

To manage frequency of severe weather events

INSURANCE WILL REMAIN A PEOPLE BUSINESS

An interview with the 2021 Lex McKeown Trophy winner

WE ARE YOUR VOICE

2021

Thanks for honouring us with this recognition

Lines of Business: ► Professional & Financial Risks ► Casualty ► Energy, Property & Construction ► Crisis Management ► Accident & Health ► Financial Risk Solutions ► Marine ► Global Transaction Solutions ► Surety ► War & Terrorism ► Treaty Reinsurance (LM Re)

Specialisations: ► Directors & Officers ► Professional Indemnity ► Financial Institutions ► IT Liability ► Infrastructure & Construction ► Workers’ Compensation ► Environmental

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Exploration & Production Renewable Energy Oil, Gas, Petrochemical & Chemical Marine General Liabilities Hull & Cargo Product Recall Parametric Weather Index Solutions

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The independent NIBA Broker Market Survey was conducted from July to September 2021 and compared 18 general insurers and insurance agencies in Australia.

Liberty Specialty Markets is a trading name of Liberty Mutual Insurance Company, Australia Branch (ABN 61 086 083 605) incorporated in Massachusetts, USA (the liability of members is limited).

CONTENTS

December 2021/January 2022

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FEATURES

Insurance Adviser magazine is the monthly magazine of the National Insurance Brokers Association (NIBA).

Insurance Adviser magazine is published by NIBA

EARN UP TO 11 CPD POINTS

Publisher

Philip Kewin, CEO, NIBA T: (02) 9459 4305 E: pkewin@niba.com.au W: niba.com.au

Communications Manager Wendy Martin

NIBA Editor Tanaya Das

Editorial enquiries

E: editor@niba.com.au

National Sales Manager Tony May E: tmay@niba.com.au

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YOUR GUIDE TO THE 2021.2 NIBA CONVENTION What does #NIBA2021 have in store for you?

Design

Citrus Media www.citrusmedia.com.au NIBA gives no warranty and makes no representation that the information contained in this magazine is, and will remain, suitable for any purpose or free from error.

To the extent permitted by law, NIBA excludes responsibility and liability in respect of any loss arising in any way (including by way of negligence) from reliance on the information contained in this magazine or otherwise in connection with it.

The contents of Insurance Adviser are protected by copyright and NIBA reserves its rights in this regard.

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NIBA MENTORING PROGRAM Future proofing the insurance broking profession

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CONTENTS

December 2021/January 2022

FEATURES A NIBA BROKERS’ GUIDE TO A SUSTAINABLE FUTURE

This guide is brought to you through a partnership between Allianz Australia Insurance Limited (Allianz) and NIBA. FEATURES Change is in the wind..........4 Measuring and modelling climate risk...........................6 Building standards – do we need to do more?.................8 Farming a solution..............10

28 SUPPLY CHAIN

Disruptions had major insurance implications

34

NATURAL DISASTERS

Insurance is a critical component in disaster response

IN EVERY ISSUE NIBA CEO Welcome ...................................... 6 Representation ................................................ 8 Why be a NIBA member? ............................ 10

NEWS

Industry Bulletin ........................................... 12 NIBA Awards................................................ 16

PROFESSIONALISM

AFCA Case-study ......................................... 18

EVENTS

Forthcoming Events ..................................... 27 Event Pictorials ............................................. 50

REFERENCE

Community Hub .......................................... 42 Insurer Strength Ratings .............................. 48

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OUR PERSONAL LINES INSURANCE COMES WITH A PERSONAL TOUCH. Here at CGU Insurance, we want to nurture and protect the ambition of you and your clients.

With underwriting expertise, specialised claims professionals and real people to talk to when you need it most, we help to make personal lines insurance ... well, personal.

It’s not just about cover for your clients. It’s about helping to build a relationship with them.

We’re proud to be committed to both. And we’re here for the long run.

For more information, contact your Broker Relationship Partner.

Always consider the Product Disclosure Statement and Target Market Determinations available from the product issuer, Insurance Australia Limited, ABN 11 000 016 722, AFSL 227681, trading as CGU Insurance. This advice is general advice only and does not take into account a customer’s individual objectives, financial situation or needs (‘personal circumstances’).

CEO / Welcome

IT’S BEGINNING TO LOOK A LOT LIKE CHRISTMAS

A

s we career headlong into Christmas, there is an air of familiarity, positivity, and at the same time apprehension. Seeing shopping centres return to a sense of pre-Christmas activity, not seen for a couple of years, is an invigorating and positive sight. Shopping trolleys are full of new Christmas trees and decorations. Tourist destinations are fully booked. It feels like things are getting back to what we might consider ‘normal’.

However, like the past few years, uncertainty remains supreme, and just when you think we may be out of the woods, the Omicron COVID–19 variant arrives. It’s a reminder that we will be living with some type of Coronavirus for a long time to come. Therefore, it is so important we equip ourselves with the tools to stay safe and be successful.

Knowledge is another form of the vaccine to protect us against the unexpected.

The 2021.2 NIBA Convention, Professionalism + Resilience = Opportunity, will see us come together in a COVID-19 safe environment to equip you with your dose of knowledge. Live events are being conducted in all major states, with 11 CPD points available when adding live and virtual sessions. We have a host of speakers, and you can find more information on page 22. We will also be looking at the current state of the insurance world in the context of those events impacting us at present and into the future.

Christmas also means storm season, and with another La Nina having been declared, we’ve already received a deluge of rain in the eastern states. As such, brokers will be vigilant and as always, on hand to help their clients if the need arises. We will be having an in-depth look at the impact of storms, floods, and fires and the related insurances, as well as trends on major risks from an insurance perspective on day four of the 2021.2 NIBA Convention in Queensland on 16 February.

Talking to many brokers, its quite clear that the new ‘norm’ of what the office looks like, is still evolving. In Sydney, the latest reports are that the CBD is currently at 8% occupancy, which suggests we are a long way away from returning full time to the office. Many employers are remaining flexible and waiting for the new year to reshape what return to work policies look like. We will be exploring the latest in HR issues and return to work practices on day two of the 2021.2 NIBA Convention in Melbourne on Tuesday 8 February. We will also be covering the latest developments from AFCA, ASIC, and the IBCCC in Melbourne, and will also look at the latest about Business Interruption, and the impact of the test cases on day three on Monday 14 February in Perth.

The value of brokers is well illustrated in the Deloitte Access Economics – The Economic Value of Insurance Broking Report. However, it is clear that we can do more to educate important stakeholders on what brokers do. This is why we have asked NIBA members if they have a relationship with their local Federal MP or Senator. Alternatively, if they would like to introduce themselves and their business to their local member, we have provided a Member Advocacy Guide and the necessary supporting tools. One of NIBA’s strategic

6 / INSURANCE ADVISER DECEMBER 2021/JANUARY 2022

objectives is to be a ‘trusted partner’, so brokers having these relationships is an important component in fulfilling this objective.

Our recent meeting with the Assistant Treasurer, The Hon Michael Sukkar MP, was another important part in that process, as we continue our efforts to build relationships and ensure we are fully engaged with all key parties in preparation for the 2022 Remuneration Review.

We will bring you the latest progress on the 2022 Remuneration Review at the 2021.2 NIBA Convention in Adelaide on Monday 7 February. We will also examine the issues around availability and affordability of insurance.

The debate around personal advice and general advice remains, and we will examine the future of advice on day five of the 2021.2 NIBA Convention in Sydney on Monday 21 February. I know everyone will be looking forward to celebrating at the Gala Dinner later that evening.

Code of Practice

We have taken the feedback from our first draft of the updated Code of Practice and have released a new version for further consultation. The final version is expected to be ready for the 2021.2 NIBA Convention in February.

As this year comes to a close, I would like to thank all the NIBA Committee members and volunteers across the country. Scheduling events has been difficult, anad we appreciate everyone’s patience, understanding, and unwavering commitment.

No matter what circumstances evolve in the coming months, nothing will change the fact that Christmas is a time to share, be with loved ones, be grateful for what we have, and have some time to recharge after a tumultuous couple of years. From everyone at NIBA, Merry Christmas.

PHILIP KEWIN Chief Executive Officer, NIBA

NEWS / Representation

WE ARE YOUR VOICE! NIBA Member Representation: Year in Review

I

t’s been a busy year for NIBA’s policy and regulatory team. In addition to providing a number of submissions to the Australian Securities and Investments Commission (ASIC) on the Royal Commission reforms that came into effect this year, NIBA has also represented its members on a broad range of issues including building reform, workers’ compensation, emergency services funding, and cyber terrorism.

Western Australia Workers Compensation

NIBA provided feedback to WorkCover WA on the proposed Workers Compensation and Injury Management Bill 2021.

NIBA’s submission was heavily influenced by the technical expertise and advice provided by the WA Divisional Committee working group, which included brokers from across the WA broking community.

Following feedback, WorkCover WA will prepare a report for the Minister for Industrial Relations and finalise the Bill before it’s introduced to Parliament early in 2022.

New South Wales Building Reform

NIBA joined representatives from the building, insurance, emergency management, and government sectors at the Building Stronger Homes Roundtable.

The roundtables – a joint initiative of the Master Builders Association (MBA) and the Insurance Council of Australia (ICA) – aimed to create a pathway towards national policies that improve property resilience.

The roundtable focused on issues surrounding building codes and standards, new property developments and land-use planning.

Australian Reinsurance Pool Corporation

NIBA provided a submission to Treasury’s triennial review for the design and operation of the Australian Reinsurance Pool Corporation (ARPC).

The review considered whether physical damage caused by a cyber-terrorist attack should be covered under the scheme.

NIBA’s submission highlighted that while the risk of such events occurring remains low, the rise of IoT makes attacks such as these increasingly attractive. In addition, the submission noted that while the number of connected devices has increased significantly over the past few years, levels of awareness and cyber security have not always kept pace.

The submission argued that it is unlikely that cover for physical cyberattacks would be able to be sourced from the commercial market and in NIBA’s view the scheme is best placed to facilitate this cover to the market.

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NSW Emergency Services Levy

Continuing the campaign for the abolition of the Emergency Services Levy (ESL) on insurance premiums, NIBA met with the NSW Minister for Finance Damien Tudehope to discuss the levy, and its impact on insurance brokers who collect the levy on behalf of foreign insurers.

NIBA highlighted the significant financial burden and risk assigned to brokers when placing risks based in NSW with foreign insurers.

While NIBA remains committed to advocating for the abolition of ESL, it is hoped that these issues can be addressed while larger issues around the future of ESL remain unresolved.

Northern Australia Cyclone Reinsurance Pool

NIBA provided a submission to the Treasury Taskforce preparing recommendations to the Government in relation to the proposed cyclone reinsurance pool for northern Australia.

NEWS / Representation

The submission stressed the importance of encouraging more insurers to participate in the Northern Australia insurance markets, particularly in far north Queensland.

The submission also urged the examination of options likely to achieve a material reduction in premiums payable by policyholders and property owners in northern Australia beyond the 10–15 per cent theorised by the introduction of the reinsurance pool.

Treasury review of the Australian Financial Complaints Authority

NIBA provided a submission to the Treasury review of the Australian Financial Complaints Authority (AFCA). The submission highlighted the need for a more robust complaint triage system to consider the nature of the complaint, the parties against who the complaint should be directed (the broker, the insurer, or both), and whether the complaint has a factual basis.

This is important because the broking firm bears the cost of AFCA’s complaint, even when there is no real basis for the complaint against the broker. If the broking firm needs to take the matter to a decision stage, in order to obtain a fair result, the cost of the process is substantial and is often disproportionate to the amount in dispute.

AFCA Engagement Charter

NIBA’s submission supported the creation of an Engagement Charter to provide clarity to complainants and their representatives and financial firms as to their rights and obligations as members of AFCA, or as users of AFCA’s services.

NIBA noted that the charter repeatedly states that AFCA will follow principles of fairness when making its decisions. NIBA expressed concern that the inclusion of these terms without appropriate explanation of their meaning in this context could be misleading for complainants, as the concept of fairness is highly subjective.

Compensation Scheme of Last Resort

NIBA provided a submission to the Treasury consultation on the Compensation Scheme of Last Resort (CSLR).

NIBA has raised several concerns about the proposed scheme, including the expansion of the scheme to include financial services that were out of scope of the scheme recommended by both the Royal Commission and the Ramsey Review, despite

a lack of evidence to suggest a significant problem of unpaid compensation exists.

NIBA argued that effective regulatory oversight combined with the new intervention powers granted to ASIC would significantly decrease demand for a CSLR. The submission also highlighted that the proposed scheme did not adequately address the issue of moral hazard, with the current design providing an incentive to dishonest firms to use the scheme to underwrite poor governance practices or unethical conduct, safe in the knowledge that the scheme will ‘pick up the tab’.

Tasmania Fire Services Act

SIRA Food Delivery Drivers

ASIC Affordable Advice Project

NIBA’s submission acknowledged that the Australian regulatory environment was ill prepared to handle the changes to the workforce brought on by the gig-economy.

NIBA noted that while some delivery platforms have their own injury insurance policies, the benefits available under these policies are significantly less than those available under the NSW workers’ compensation scheme.

Given the nature of their work, NIBA argued that food delivery riders met the requirements of a deemed worker, and as such, the existing scheme should be extended to include food delivery riders.

ASBFEO Amusement DMF Review

NIBA provided a submission to the Australian Small Business and Family Enterprise Ombudsman(ASBFEO) on the establishment of a Discretionary Mutual Fund for the amusement, recreation and leisure industries.

NIBA’s submission, while supportive of the measure, highlighted the need for rigorous vetting of members and a strong risk management framework to underpin the operation of the scheme.

NIBA also highlighted that both the insurance and reinsurance markets were experiencing a significant hardening which could affect the financial position of the scheme, given its reliance on reinsurance in the first few years of operation.

NIBA provided a submission to the Tasmanian Government review of the Fire Services Act. NIBA joined several other organisations, including the Property Council of Australia, in calling for the abolition of the Fire Services Levy that is currently levied on insurance premiums.

The submission argued that the levy was an inefficient funding model in that it both disproportionately affected one group over another and it disincentivised responsible risk-management behaviour.

NIBA provided a submission to ASIC in response to its work on promoting affordable advice.

NIBA’s submission stated that any discussion around promoting access to advice should also include access to risk advice.

The submission highlighted that financial advice takes many forms and that a onesize-fits-all approach would be unlikely to achieve a positive result.

NIBA supported ASIC’s view that the terminology used to describe different forms of advice is often vague and confusing, and encouraged ASIC to focus on how the terminology might be interpreted by clients and affect their expectations of the service they will receive.

Royal Commission Reforms

NIBA provided a number of submissions and technical advice to ASIC on a wide range of Royal Commission Reforms including: • Deferred sales model • IDR data reporting • Breach reporting guidelines • Claims handling • Design and distribution obligations.

NIBA would like to sincerely thank our members, divisional committees and directors for their invaluable feedback and technical expertise throughout the year.

We look to forward to continuing to represent our members and to tackling new issues in 2022.

CONTACT NIBA

As always, brokers who have questions about these or any other government or regulatory matters should feel free to contact NIBA CEO Philip Kewin at: pkewin@niba.com.au

NIBA.COM.AU / 9

NIBA / Member Benefits

WHY NIBA MATTERS TO ME Members share why NIBA is important to them and the broking industry.

“Being a member of NIBA has always filled me with confidence that I have the power of a highly professional body behind me, advocating for my best interests. NIBA has frequently provided me with incredible opportunities to network and grow with other professionals within the industry, through which I have met some lifelong friends. The regular communications and updates NIBA provides have continually ensured that I have the tools to further my knowledge and career in the insurance broking profession.”

MITCHELL WIGHT Integral Insurance Services Winner of the 2021 Warren Tickle Memorial Award for the Young Professional Broker of the Year

WELCOME TO NIBA

NIBA is thrilled to have the following new Principal member on board: • HARLOCK INVESTMENT SERVICES PTY LTD – ACT

ABOUT NIBA OUR MISSION

NIBA is the one voice for insurance brokers in Australia, representing their interests and promoting high standards of professionalism and competence.

OUR OBJECTIVES Representation

We represent the interests of members and their clients to governments, regulators, industry stakeholders, the media and the community in a manner that is respected and relevant. We have forged strong relationships at a state and national level to ensure that your interests are represented.

Professionalism

We set and promote high standards of professional practice for insurance brokers for the benefit of their clients and the community through the development of professional standards, QPIB, CPD accreditation and the Insurance Brokers Code of Practice.

Community

We provide members with opportunities to meet, share, grow and prosper, and build professional networks with the wider intermediated insurance community that will last throughout whole careers.

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GET IN TOUCH!

Whatever your age, or level of experience, NIBA ha s brokers’ best interests at the core of everything we do. Fin d out what we can do to help be nefit your business and your tea m at niba.com.au/membe rship

WHAT IS COVERED?

NEWS / Industry Bulletin

REWARD AUSTRALIA’S EMERGING BROKING TALENT N ominations for the 2022 Verosponsored Young Professional Broker of the Year Award are now open, and anyone in the industry can nominate a top emerging talent in the insurance broking space. The winner of each state/territory Vero-sponsored Young Professional Broker of the Year Award then becomes a finalist for the national Warren Tickle Memorial Award.

The 2021 Warren Tickle Memorial Award winner Mitchell Wight explains why he found the entire experience so unique as well as exciting, and how it has propelled his career. He said, “The development program sponsored by Vero is fantastic at providing insights into your own personal development, while helping to equip you with tools that you will use to further your career within the industry. Being named the Young Professional Broker of the Year award has opened doors not just individually, but also for my organisation to a range of experienced professionals within the industry. These senior industry members have been more than willing to assist and provide mentorship throughout the exciting changes that come with being named the Warren Tickle Memorial Award Winner.”

Each year, NIBA celebrates the achievement and contribution of an outstanding member, under the age of 35, through the Young Professional Broker of the Year Award at the state/territory level and the Warren Tickle Memorial Award at national level. Sponsored by Vero, the award represents the pinnacle of achievement for the nation’s young broker community.

Inviting everyone connected to

the insurance industry to nominate professionals for the award, Wight added, “Nominating a young professional for the Warren Tickle Memorial Award provides an incredible opportunity for your organisation’s future leaders to represent the best of your company’s brand.”

Awarded to a young professional who has exhibited an outstanding level of professionalism and integrity, the national award began in 1990 in honour of Warren Tickle, a former Insurance Commissioner, and insurance lecturer. He was the Commissioner responsible for the implementation of the Insurance (Agents & Brokers) Act 1984. Warren’s early insurance career was at Sun Alliance, today known as Vero, the sponsor of this award.

The winner of the Warren Tickle Memorial Award is selected from five

“Nominating a young professional for the Warren Tickle Memorial Award provides an incredible opportunity for your organisation’s future leaders to represent the best of your company’s brand,” Wight added.

finalists who are chosen as the Young Professional Broker of the Year in their state/territory: NSW/ACT; Vic/Tas; SA/ NT; WA and Qld. The state winners receive access to a four-week professional development program and the Vero Young Brokers Alumni. The winner of the Warren Tickle Memorial Award also receives a tailored learning experience to the approximate value of $10,000, courtesy of Vero. Previous winners have received a prize including a trip to London to experience the international broking market, and a study program at the Yale School of Management in New Haven, Connecticut (USA).

Entries are assessed by the state/territory judging panel throughout March and April 2022, and finalists are announced at regional events in May and July 2022.

All state/territory finalists are eligible for the Warren Tickle Memorial Award. If you are a part of the insurance industry in any capacity and know a young broker who is doing a wonderful job looking after the needs of their clients, you are invited to nominate them for the NIBA awards at niba.com.au/niba-awards, it takes just five minutes.

For breaking news and updates curated specially for insurance brokers please visit: niba.com.au/articles

12 / INSURANCE ADVISER DECEMBER 2021/JANUARY 2022

NEWS / Industry Bulletin

NIBA MEETS WITH ASSISTANT TREASURER ON BEHALF OF BROKERS

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ey representatives from the National Insurance Brokers Association (NIBA) met with the Assistant Treasurer, The Hon Michael Sukkar MP, as part of ongoing advocacy activities.

NIBA was represented by CEO Philip Kewin, former CEO Dallas Booth, and Board Director Eric Harris. This was NIBA’s first meeting with the Assistant Treasurer and it was an important engagement in raising further awareness of the value of brokers to their clients and the community.

Kewin said, “Minister Sukkar was very

open and supportive, recognising the important role brokers play particularly in the last 18 months. He was particularly concerned about the hard market that currently exists and the challenges particularly around leisure and tourism.

These are key drivers of economic growth, and the challenges around affordability and accessibility would be an unnecessary handbrake.”

He added that another important part of the discussion was the upcoming Remuneration Review in 2022, “recognising that there were no systemic issues or examples of poor consumer

outcomes involving brokers in the Royal Commission, we acknowledged that Treasury will be undertaking a review as recommended in the final report. NIBA has already engaged with key members of ASIC and Treasury, so engagement with the Assistant Treasurer was a natural step.

Minister Sukkar indicated that the terms of reference for the review may be delivered sometime before the end of this year.”

Kewin concluded, “The lines of communication are well and truly open and all parties agreed to maintain dialogue so that there can be an informed and objective review.”

DOES YOUR LOCAL MP OR SENATOR KNOW WHAT A BROKER DOES?

E

arlier this year, the Minister for Superannuation and Financial Services, The Hon Jane Hume MP, announced that the Life Insurance Framework (LIF) Review and the Quality of Advice Review would be combined and brought under the purview of Treasury, enabling the review to consider the full breadth of issues impacting both the quality and affordability of all forms of financial advice.

As part of the review, Treasury will consider whether the current conflicted remuneration and non-monetary remunerations exemptions for general insurance brokers remain relevant. Achieving a positive outcome for members is NIBA’s number one priority, and we are well underway in our preparations for the review, engaging with federal ministers and Treasury.

Last year, following the release of the Deloitte Report on the economic value of insurance brokers, NIBA engaged with state and federal ministers, consumer, and business groups to increase awareness and understanding of what our members do, and the benefits brokers provide to their clients.

This year we want to go further, and we need your help to do it.

Our aim is to have every federal MP and Senator visited by a local broker who offers insight on what they do and how their work benefits their clients. To support members in these conversations, NIBA has developed a number of resources including a Member Advocacy Guide, speaking points, and a leave-behind document for representatives to refer to in future conversations.

Members who would like to assist NIBA in developing stronger relationships with federal MP’s and Senators should send an email to NIBA’s Policy Manager, Allyssa Hextell on ahextell@niba.com.au, indicating your interest, federal electorate (if known) or location, and if you already have an existing relationship with your local representative.

For breaking news and updates curated specially for insurance brokers please visit: niba.com.au/articles

NIBA.COM.AU / 13

NEWS / Industry Bulletin

BROKER CONVERSATIONS CAN IMPACT THE CHANGES SMES MAKE TO INSURANCE N ew research findings released

by Vero today reveals nearly two-thirds of Australian Small Medium Enterprises (SMEs) have altered their business models as a result of COVID-19, yet, only around one-third of those have made changes to their business insurance.

Vero surveyed 1,500 Australian SME business owners/ decision makers to gain insight into how the pandemic has affected their business operations, insurance purchasing behaviours, and perceptions of the insurance industry.

Vero Head of Commercial Intermediaries, Anthony Pagano said brokers should work with SMEs to revise their insurance to ensure it suits the changing circumstances.

“The research suggests that most businesses are different now to early 2020, and while they may have been proactive in changing their models to suit the pandemic conditions, many are lagging behind when it comes to adjusting their insurance.

There is a risk that many SMEs are under or inappropriately insured as a result of the changes they’ve made and have not considered the material implications to their insurance program or business,” he said.

“SMEs impacted by COVID-19 are not the only customer segments brokers should touch base with. Regardless of industry or size, brokers should continue to check their clients’ situation to ensure any changes are appropriately reflected in their insurance.”

Increasingly, the changes that SMEs have made to their business look to be permanent with over 80 percent saying that they will keep either all or some of the changes they’ve made to their business, up 19 percent from this time last year. A majority (87 percent) of those who are planning to retain all the changes have talked to their broker, but only 57 percent who are planning to keep just some of the changes have been in contact.

“As we learn to live with the virus and

begin a new ‘normal’, brokers should also look to the future and understand which changes their clients plan to keep and areas where they will revert,” Pagano said.

“Broker clients are more likely to have increased or tweaked their insurance, while direct is more likely to have cancelled, showing the value a broker can bring in navigating businesses through difficult times.”

Broker conversations can impact the changes that SMEs make to their insurance, with those who have been in contact with their broker far less likely to have made negative changes to their insurance, such as increasing their excess or cancelling some or all of their insurance.

“This suggests that brokers play a clear role in ensuring that SMEs make appropriate decisions about how to best reduce their insurance.”

When asked what SMEs are worried

about, COVID-19-related concerns dominate the list, with the long-term impact of the pandemic on the economy ranked the highest concern at 39 percent. Other significant COVID-related concerns include mental health of employees, maintaining COVID safe practices, and managing vaccination status. “This suggests that COVID-19 will clearly continue to impact the decisions SMEs will need to make over the coming year,” Pagano added.

Many SMEs are now placing importance on insurance covers that are relevant to pandemic conditions such as restarting after suspended operations, ongoing maintenance of equipment, and covering employees who work from home.

Pagano concluded, “Brokers could expand their conversations beyond just physical risks such as exposure to fire and look into insurance ramifications for issues such as remote working.”

“Regardless of industry or size, brokers should continue to check their clients’ situation to ensure any changes are appropriately reflected in their insurance,” Anthony Pagano, Vero Head of Commercial Intermediaries.

For breaking news and updates curated specially for insurance brokers please visit: niba.com.au/articles

14 / INSURANCE ADVISER DECEMBER 2021/JANUARY 2022

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COMMUNITY / NIBA Awards

SPOTLIGHT ON THE 2021 LEX MCKEOWN TROPHY WINNER: TIM WEDLOCK Wedlock’s career spans more than three decades in the insurance broking profession, including stints as the NSW Divisional Representative on the NIBA Board, as well as the Association’s President.

BY TANAYA DAS PHOTO BY VINCENT BOYER

T

he Lex McKeown trophy recognises a NIBA member who has made an outstanding contribution to the Association. This year’s Lex McKeown Trophy for lifetime achievement was awarded to Tim Wedlock from AEI Insurance Broking Group. Edward Alexander McKeown (known as Lex) formed IBA in 1971, by convincing four other brokers that the insurance industry needed regulation, and within a couple of years IBA had 300 members throughout Australia. After NIBA was formed in 1982, McKeown joined the new Association in 1986 and had the Lex McKeown Trophy in perpetuity named after him.

Wedlock is a long-standing NIBA member who has provided excellent service to the Association and has made a significant contribution to the broking profession. His journey into insurance started back in 1986, when his uncle (the previous founder and now Chairman of AEI Group) suggested he apply for a job in insurance. Wedlock is now the Managing Director of the AEI Group incorporating the AEI companies, comprising seven branches across four states (NSW, ACT, Queensland and Victoria) with 100 employees. He is now a proud QPIB and Fellow of NIBA and ANZIIF. Insurance Adviser: What is it about insurance broking that excites you each day?

Tim Wedlock: Without a doubt, the passion to look after clients and our staff. I enjoy the client interaction part of broking, as well as the underwriter interaction. I thrive on the importance of not letting anyone down, and making sure the job is done before I can relax. I also enjoy all that I have learnt so far in my journey, and passing on as much as I can. To see our team of people happy and learning, and proud of what they are also achieving, is very rewarding.

IA: What do you think makes insurance an interesting career choice?

TW: I believe insurance is the unsung hero of keeping families, businesses and communities going. It’s diverse, you can train and be educated as you learn – it’s rewarding, it pays well and it’s a global profession. When I explain this to careers advisers, they look stunned and want to know more.

IA: You have had a long association with NIBA. What got you started, and what motivates you to devote so much time to your industry association?

TW: It all started back in 2004, when I was awarded the NSW Broker of the Year award. Apart from helping support young professionals, I have been involved on NIBA Committees and the National Board since 2011, and have

16 / INSURANCE ADVISER DECEMBER 2021/JANUARY 2022

enjoyed supporting our Association in its journey – raising professional standards and being part of the one voice that represents insurance brokers across Australia.

IA: What have been the highlights of your career so far?

TW: Growing confidence in what I do – knowledge and learning gives confidence, as do great mentors. I have had wonderful mentors in various aspects of my career and am truly grateful. To see AEI continue to grow makes me very proud, as does receiving the Lex McKeown Trophy, given my devotion to and passion for NIBA.

COMMUNITY / NIBA Awards

IA: What is the biggest lesson you have learnt in your career?

TW: Never lie or make it up. If you don’t know the answer to something, don’t be embarrassed. Use it as an opportunity to learn and find it out.

IA: What are the qualities of a good leader/manager?

TW: Honesty, empathy, communication skills, and having fun with your team.

IA: What charitable causes are important to you?

TW: Like a lot of people, there are several charities I have aligned myself with: helping our returned service men and

women who suffer from PTSD, the White Knight Foundation that helps families who have suffered unprovoked youth violence, You can Sit with Me that helps kids who are bullied, Rural Aid and a variety of sporting Associations.

IA: Where do you see the insurance broking profession 5-10 years from now?

TW: In the future, I see the insurance broking profession continuing to be a people business, making sure we keep our families, communities, and businesses safe.

We will keep raising the bar when it comes to professionalism, weeding out the rogues who do not uphold our values so we can be recognised as a profession of choice.

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NIBA.COM.AU / 17

PROFESSIONALISM / AFCA Case Study

DUTY OF CARE AND THE LETTER OF APPOINTMENT

This determination involved an alleged failure by an insurance broker (after a new insurance broker took over conduct of the complainant’s insurance) to send a renewal notice for motor vehicle insurance, which caused the complainant loss when the vehicle was damaged while uninsured.

Background facts

The complainant held a motor insurance policy arranged by the old insurance broker in June 2018, and in March 2019 engaged a new broker to handle its insurance needs. A letter of appointment (LOA) for the new broker had been sent to insurers by the complainant.

There was no indication in the LOA dated 13 March 2019 that the new broker was to take over all insurances, except for the cover for the vehicle. The old broker had attempted to obtain a copy of the LOA from the insurer over the phone after being notified that the complainant’s insurance was moving to the new broker, but had been unsuccessful.

There had been contact between the old broker and the complainant in mid-March 2019 when the old broker had informed the complainant that it would need to contact the new broker, as it no longer had access to the policies. At this time, the complainant did not clarify that the old broker still acted for the complainant in relation to the vehicle.

Because of this, no renewal notice was sent by the old broker in relation to the policy and, as a result, in June 2019 the policy lapsed. In December 2020, the vehicle was damaged in an incident. The new broker contacted the insurer on the complainant’s behalf to lodge a claim, but was unsuccessful as the policy had lapsed.

In an email on 4 January 2021, the new broker stated that the policy for the vehicle had been omitted from the LOA ‘by accident’ and in correspondence with the insurer in July 2021 the new broker provided the LOA and noted that it was ‘for all the client’s policies’.

The complainant claimed that the vehicle was uninsured at the time of the incident

due to the old broker’s failure to send it the renewal notice and sought compensation from the old broker for the loss suffered due to the lapsed policy, which it alleged arose from breach of its duty of care.

The complainant stated that the relationship between itself and the old broker had not ended and submitted that: • it had engaged the new broker for its business insurance, but not for the policy covering the vehicle • in accepting information from the insurer over the phone instead of obtaining the LOA, the old broker had breached its duty • the vehicle’s policy was not specifically mentioned in the letter of appointment • the old broker was still the broker on record with the insurer on the disputed policy, meaning the duty continued regardless of the LOA • the old broker should have referred the renewal notice received from the insurer in May 2019 to the complainant, and • the new broker did not know of the policy’s existence and so could not have arranged for it to be renewed.

The AFCA decision

AFCA held in favour of the old broker and stated that it did not owe a duty of care to the complainant because the LOA clearly ended the relationship between the old broker and the complainant as it: • clearly instructed the insurer that ‘AH’ would manage all the complainant’s insurance broking needs • specifically included the policy renewal as one of the duties assigned to the new broker, and • clearly stated that it applied to all

18 / INSURANCE ADVISER DECEMBER 2021/JANUARY 2022

BY MARK RADFORD

Principal, Radford Lawyers

commercial and domestic policies and rescinded all current, existing, or past appointments, which would include the broker’s appointment.

Furthermore, AFCA: • accepted that: o the old broker asked for the LOA from the insurer during the phone call when it was notified the complainant’s insurance was moving to the new broker, but the LOA was not provided o insurers often do not provide the LOA when a broking arrangement ends due to privacy reasons, and o the old broker was aware of the content of the LOA based on another LOA received from another client moving business to the new broker, and that the broker followed the LOA’s instructions.

• from March 2019, even if the new broker had not known about the vehicle policy, as the complainant’s new broker, it had a duty to understand the complainant’s insurance needs and account for them. Additionally, there had been adequate time for the new broker to perform a needs analysis and identify that the vehicle’s insurance was due to be renewed in June 2019.

Further, there had been a full renewal cycle from June 2019 until June 2020 prior to the loss.

• although the old broker could have passed the policy renewal to the complainant or new broker in May 2019, it was under no obligation to do so, and doing so would have been only a gesture of goodwill.

Thus, AFCA held that the old broker was not liable for the complainant’s loss.

“QPIB represents competence and the will to strive for excellence.”

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Apply online at niba.com.au or email NIBA Memberships Manager Audi Witsen – awitsen@niba.com.au

D PRAC IE T F I

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QPIB – A STATEMENT OF PROFESSIONALISM

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– CAITLIN CARSON, 2019 YOUNG PROFESSIONAL BROKER OF THE YEAR

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COMMUNITY / #NIBA2021

YO GUID THE 2 NIB CONVE What does #NIBA2021 have in

BY TAN

20 / INSURANCE ADVISER DECEMBER 2021/JANUARY 2022

OUR DE TO 2021.2 BA ENTION store for you? Read on to find out.

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NIBA.COM.AU / 21

T ILO RED PROA GRAM EVERY F STATOR NIBA w E ill host conv a

COMMUNITY / #NIBA2021

THE BASICS OF GOOD SERVICE REMAIN

A

tête-à-tête with Dr Rhys Bollen, Senior Executive Leader, Insurers at the Australian Securities and Investments Commission (ASIC).

Insurance Adviser: You’ve been a part of the regulatory landscape for a while now. What insights have you picked up along the way?

Dr Rhys Bollen: I believe most firms want to comply and will do so if they understand how to. It’s important to understand incentives, as well as their business models, and to get them right. Additionally, good systems, controls and governance go a long way to improving outcomes for firms and their clients.

IA: What do you think the future of insurance regulation will look like for ASIC? RB: Going forward, disclosure and advertising will still matter in regulating general insurance. ASIC will increasingly focus on the product under the hood: product design, distribution and fairness. We’re also seeking to ensure a robust and competitive market that’s increasingly data driven –to support both ASIC’s regulatory work and the marketplace more generally.

IA: What are some key observations you’ve made in your years being a part of the insurance landscape?

RB: It’s simple – the same basic needs that drive most communities also apply to the insurance landscape: to protect one’s assets, health and family.

Products come and go, as do companies,

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MEET YOUR EMCEES ACROSS THE COUNTRY

Rebecca Morse, Adelaide

but the basics of good service remain. More importantly, good companies and good products will stand the test of time.

IA: The theme of the NIBA Convention this year is Professionalism + Resilience = Opportunity. What does professionalism and resilience mean to you? Do you have any highlights for those who will be attending your session at the 2021.2 NIBA Convention about what topics you will be covering?

RB: Professionalism goes beyond running a successful business. It’s operating by a higher standard or code, and putting client needs ahead of profit. Resilience is the capacity to continue under pressure and bounce back after adversity. Professionalism and resilience have acquired paramount importance lately, and will continue to be required post the COVID-19 pandemic.

Dr Bollen, alongside representatives from AFCA and the IBCCC, will grace the NIBA Convention stage in February 2022 for ‘Meet the key players in Regulation’ sessions’.

22 / INSURANCE ADVISER DECEMBER 2021/JANUARY 2022

Rebecca Morse is an award-winning journalist, a former Ten News presenter and co-host of SAFM’s breakfast radio show Bec, Cosi & Lehmo.

She is also a former South Australian Journalist of the Year, has been a finalist in the Walkley Awards for excellence in Australian journalism and was named Best New Talent at the 2019 Australian Commercial Radio Awards.

Jordana Borensztajn, Melbourne

Jordana Borensztajn is a presentation skills coach, social media strategist, author and humourist who inspires, educates and entertains audiences with action-packed and high-energy keynote presentations and workshops.

Borensztajn’s experience includes being a News Corp Australia journalist, working as an online music editor, content producer and social media manager at Nova

2021.2 NIBA Convention

PROFESSIONALISM + RESILIENCE = OPPORTUNITY

This year we are bringing the NIBA Convention to you. Delegates will have the option of attending one day face-to-face and four days virtually, or all five days virtually.

7 February Adelaide 8 February Melbourne 14 February Perth 16 February Brisbane 21 February Sydney THANKS TO OUR PRINCIPAL PARTNERS

EARN UP TO 11 CPD POINTS

COMMUNITY / #NIBA2021 Entertainment, speaking at corporate conferences around the world, performing two sold-out shows in the Melbourne International Comedy Festival, and running a schools program that explores online safety for students.

News. It was here that his live location hosting skills were showcased, resulting in a Queensland media award (Clarion) for best live interview in 2009. It was a nine-minute live, unscripted ‘walk down disaster lane’ sharing residents’ accounts of being caught up in the devastating 2008 Gap storms.

“My session will focus on leadership and teamwork, adapting to the situation to build resilience within a system and the individual.”

Christina Morrissy, Perth

While Christina Morrissy is best known for her public role as a talkback radio host, TV news presenter, current affairs journalist and travel show host, she has also worked successfully in the print industry, including as editor of Perth Woman Magazine. In this role, she provided end-to-end project management for a highly successful West Australian publication, and as a subeditor at WA’s only regional daily newspaper, The Kalgoorlie Miner.

Bill McDonald, Brisbane

Bill McDonald completed work experience as a journalist at Queensland Country Life newspaper during high school and soon started freelance writing at Queensland Newspapers, which turned into Radio 4BK and finally Channel 10 Toowoomba in 1987.

In 2004, he became a co-anchor of Ten

Andrew Klein, Sydney

Andrew Klein is one of Australia’s leading professional conference emcees, as well as a pitching presentation skills speaker, trainer and writer, working on conferences around the Asia-Pacific region, as well as in the United States and South Africa. A former corporate lawyer, he quit law in the late ’90s before starting up his own business as a corporate trainer and speaker.

“In my session I’ll elaborate on Fighter Pilot Resilience. Why you shouldn’t give up in the face of adversity , and on VUCA – Operating in Volatile, Uncertain, Complex and Ambiguous environments.” #NIBA2021 CLOSING KEYNOTE SPEAKER, CHRIS ‘BOO’ BOUCOUSIS

DATES FOR THE DIARY

ADELAIDE, SOUTH AUSTRALIA – 7 FEBRUARY 2022 MELBOURNE, VICTORIA – 8 FEBRUARY 2022 PERTH, WESTERN AUSTRALIA – 14 FEBRUARY 2022 BRISBANE, QUEENSLAND – 16 FEBRUARY 2022 SYDNEY, NEW SOUTH WALES – 21 FEBRUARY 2022

WITH THANKS TO OUR PRINCIPAL SPONSORS

24 / INSURANCE ADVISER DECEMBER 2021/JANUARY 2022

#NIBA2021 OPENING KEYNOTE SPEAKER, DR FIONA WOOD

THE MARKETPLACE

#NIBA2021 will bring the Convention Expo Hall experience across Australia, presenting a great opportunity to learn about the latest cutting-edge products and services.

Some of the wonderful businesses exhibiting at the conference include: • Biz Cover • GT Insurance • Elantis • Berkley insurance • NTI • iQumulate • CHU • Technosoft Solutions • Blue Zebra • Virtual Broking • Innovation

• Ansvar • ARAG • BAIS • Kaplan • Liberty • Loss Managment • Organiseit • Point Insurance • SLE • Steamatic • The Barn • UAA

SPONSOR OR EXHIBIT AT #NIBA2021

To discuss sponsorship and exhibition opportunities, please contact us:

Helen McGowan Waldron Smith Management T: 03 9645 6311 E: helen@wsm.com.au

Tony May NIBA National Advertising Sales Manager T: 02 9459 4320 M: 0401 485 188 E: tmay@niba.com.au

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COMMUNITY / NIBA Mentoring Program

FUTURE-PROOFING THE INSURANCE BROKING PROFESSION

The much-vaunted NIBA Mentoring Program is back for another year and the call is out for experienced old hands and eager young insurance professionals (YPs). The mentoring program has already boosted the careers of scores of YPs across the country, and this year is set to spread even more widely.

Above Catrina Galanti

Above Jack Tiftis

Above Steve Richards

Above Jordan Pereira

Above Rhett Butler

T

Please find below program dates. All live face-to-face components of the program will take place at Brisbane, Sydney, Melbourne, Adelaide and Perth locations.

he last mentoring workshop for 2021 offered vital skills enhancement and networking opportunities for mentors and mentees alike. The NIBA Mentoring Program is for young brokers, insurers, and associated professionals across the insurance industry.

The aim of the program is to empower young professionals by partnering them with supportive and motivating industry role models. With their mentor’s guidance, each mentee develops focused goals that help them achieve higher levels of performance. The program is also a great experience for mentors, many of whom appreciate the chance to do something meaningful and give back to the industry.

The latest instalment of the program will begin in February for 12 weeks, ending in May 2022. There will be three structured sessions which all mentors and mentees will be required to attend. All participants will receive a program handbook to guide you through the program.

Workshop 1: 24 February 2022 Workshop 2: 7 April 2022 Workshop 3: 19 May 2022 Meetings between mentors and mentees are flexible and should be arranged by

mutual consent. Mentors and mentees should plan to meet every week for approximately one hour during the 12week program.

As part of moving to the updated format, participants will be able to share ideas and knowledge between states and watch key videos of the other states’ programs. We hope this also provides an avenue for rural participants to join the program virtually as we livestream from CBD-based venues.

APPLY NOW

The NIBA Mentoring Program is open to all insurance professionals.

It is free and worth six CPD points on completion. The program will take place simultaneously in the major cities of Sydney, Melbourne, Adelaide, Brisbane and Perth. With sufficient demand, it will also be offered in Hobart and Darwin.

To apply as a mentee: www.niba.com.au/apply-to-be-a-mentee/ To apply as a mentor: www.niba.com.au/apply-to-be-a-mentor/ If you have any questions, contact the NIBA events team at mentoring@niba.com.au or phone (02) 9459 4311.

26 / INSURANCE ADVISER DECEMBER 2021/JANUARY 2022

NIBA / Forthcoming Events

STAY UPDATED!

NIBA EVENTS

NIBA stages a variety of educational and social events across Australia for the whole intermediated insurance community.

EVENTS UPDATE Mark your calendar to meet, share, learn and grow with your industry peers at NIBA events across the country.

Check out what’s happening close to yo u and registe r via the events cale ndar at niba.com.a u/ events

Please note in light of COVID-19, NIBA will continue to follow and implement national and state health authorities’ recommendations.

2021 NIBA NSW GALA LUNCH

#NIBA2021 PERTH

WHERE: Doltone House Jones Bay Wharf WHEN: Thursday 3 February The rescheduled NSW Gala Lunch will take place on 3 February 2022 and is held in conjunction with Wheelchair Sports NSW.

WHERE: Crown Perth WHEN: Monday 14 February Join us in Perth for a keynote speech from Dr. Fiona Wood and to hear more on workers’ compensation and business interruption claims.

#NIBA2021 ADELAIDE WHERE: Adelaide Convention Centre, North Terrace WHEN: Monday 7 February Join us for the launch of #NIBA2021 to hear from experts on the state of the industry and how new technology can be leveraged to streamline claims.

#NIBA2021 MELBOURNE WHERE: Crown Melbourne WHEN: Tuesday 8 February The hybrid Convention’s second day offers brokers an opportunity to further their understanding of industry regulators and how working practices will change in a post-COVID-19 world.

2021 NIBA SA GALA LUNCH WHERE: Panorama Ballroom, Adelaide Convention Centre WHEN: Friday 11 February The rescheduled luncheon heads to the Panorama Ballroom at Adelaide Convention Centre and will bring together the SA insurance community for an afternoon of celebrations.

#NIBA2021 BRISBANE WHERE: Sofitel Brisbane Central WHEN: Wednesday 16 February Brisbane’s section of the Convention zeros in on insurance for weather-related incidents and discusses the Northern Australia Cyclone reinsurance pool.

#NIBA2021 SYDNEY WHERE: International Convention Centre Sydney WHEN: Monday 21 February The final day of our hybrid Convention will examine the future of broking and features a closing keynote speech from former fighter pilot Chris ‘Boo’ Boucousis.

#NIBA2021 QBE CONVENTION DINNER WHERE: International Convention Centre Sydney WHEN: Monday 21 February After the Convention closes, join us for an evening of networking and entertainment at the #NIBA2021 QBE Convention Dinner.

If you’d like to advertise your products and services through NIBA, please contact Tony May today on (02) 9459 4303.

NIBA.COM.AU / 27

FEATURE / Supply Chain

28 / INSURANCE ADVISER DECEMBER 2021/JANUARY 2022

NO MORE JUSTINTIME The pandemic disrupted the global supply

chain significantly, prompting changes in

strategy to become the ‘new norm’ – and that

had significant insurance implications.

BY MARTIN WANLESS

NIBA.COM.AU / 29

FEATURE / Supply Chain

F

or years, the global supply chain had been working to a ‘just-in-time’ model. Goods were manufactured and shipped in predictable fashion, landing at their destination right in the nick of time. No unnecessary storage costs, no unnecessarily early payments: it – more often than not – worked like a dream.

It made complete sense. Until a global pandemic changed everything.

Higher demand, port closures and delays, changing supplies and changing modes of transport meant just-in-time simply couldn’t hack it anymore.

“The global shipping community said the just-in-time logistics model we’ve been working off for so many years simply didn’t work any longer,” says Kurt Herron, Logistics Risk Engineer at NTI. “Their comment to the world was ‘don’t play for just-in-time anymore; play for

Management, says, however, that some business pack policies in certain circumstances have a key foreign supply clause which could create interest in the High Court.

“This essentially extends the coverage of any peril that they can insure to their foreign suppliers’ factories,” he explains.

“In some cases that will be restricted to fire and earthquake but others will cover all perils for goods at a key supplier’s location the same way it covers Insured locations in Australia, including infectious disease outbreaks at the premises.

“It’ll be interesting to see how the High Court views this in terms of its decisions on pandemic exclusions, because we expected the High Court would follow the British courts a little more closely; the most recent judgements have been largely in favour of the exclusions. With the final judgements

“Your standard cargo policy doesn’t cover delay, so with most items – dry goods, T-shirts, whitegoods, for example – from an insurance perspective if it gets here tomorrow or in two weeks it’s irrelevant.” just-in-case’ – and that’s the way businesses simply have to operate today.”

Increased demand brought with it increased shipping costs, too. Vessels were unable to get into and out of ports with the consistency that was predictable prepandemic, causing significant issues for businesses.

“Your standard cargo policy doesn’t cover delay, so with most items – dry goods, T-shirts, whitegoods, for example – from an insurance perspective if it gets here tomorrow or in two weeks it’s irrelevant,” explains NTI’s National Product Cargo Manager, Daniel Morrison.

“On the other hand, perishable and temperature-controlled goods can have broader covers, including loss due to delay in some instances – with slowdowns in global logistics, goods are taking longer to reach their final destination, waiting on vessels and at the ports themselves, which increases the potential for loss. This is an exposure we’re monitoring quite closely and we have seen increased claims activity recently.”

Reuben Rose, Commercial Claims Specialist at claims preparation and policy specialist firm MSM Loss 30 / INSURANCE ADVISER DECEMBER 2021/JANUARY 2022

to be handed down by the end of the year, this will be the deciding factor in potential insurance relief.”

Of course, as delay due to infectious diseases is now a reality, Clayton UTZ Consultant Mark Waller says it’s important to have that stipulation drawn up contractually.

“If you are the manufacturer or supplier, any legal responsibility will depend on the terms of the contract with the counterparty and whether the development of COVID provides a legal excuse for failing to manufacture/supply or deliver on time,” he says.

“Apart from specific terms regarding the timing for delivery and excuses for nondelivery, it would be necessary to consider the terms of any force majeure clause to assess whether it provides protection to the manufacturer/supplier.

“If I am a party that is relying on delivery of a thing to perform a contract, the terms of the contract with my counterparty will determine whether I have any liability for delay caused by the fact that the supply of the thing has been prevented or delayed due to COVID – again, any force majeure term will be particularly relevant.”

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FEATURE / Supply Chain

PIVOTING BACK INTO ACTION

Many businesses around the globe were forced to change direction rather quickly as COVID-19 disrupted their operations – and that’s created a knock-on effect when it comes to insurance.

“Businesses were pivoting. They were innovating their logistics. They were innovating their products. They were expanding markets. They were investing in emerging markets, places that they wouldn’t have played with before,” says Herron.

This, of course, led to – for example – clothing businesses manufacturing personal protective equipment (PPE), alcohol makers turning their focus to hand sanitiser, and people turning their attention from sea to air as a method of more reliable transportation.

All of which came with a significant risk – which some didn’t appreciate.

“We’ve seen customers who perhaps weren’t in PPE before move into PPE and then have losses due to causes they didn’t expect due their inexperience in shipping a new commodity,” says Morrison.

“In that instance with PPE, the smallest amount of damage is going to render it unusable, and that changes the exposure.

A PROACTIVE APPROACH TO MOVING GOODS NTI was approached by a fresh fruit exporter that had, for a long time, transported its goods by air freight – it was a temperaturesensitive product and air was the best way to move it. The exporter approached NTI because it knew that the air freight endorsement it was receiving from the government wouldn’t last forever and it foresaw that it would need to move to sea freight. Because the business and the broker were proactive, they were able to sit with NTI to fully explore the risks of transporting by sea. NTI put a detailed checklist together of the mitigation required, and the client returned it promptly, fully completed. Due to this proactive approach the exporter was able to change its method of export and remain fully insured.

32 / INSURANCE ADVISER DECEMBER 2021/JANUARY 2022

“What’s been very clear is the economic toll from COVID-19 has been huge.”

Moving from sea freight to air freight changes things too.”

PLAIN SAILING OR TROUBLED WATERS?

We’re all hoping that we’re on the right track to some semblance of normality – businesses that rely on either end of the supply chain more than most.

As with many sectors of insurance, COVID-19 test cases will feature prominently over the coming months and years, and the supply chain is likely to also feature, albeit indirectly, says Waller.

“Although we have been heavily involved in the two test cases regarding whether business interruption insurance responds to losses caused to a business due to COVID-19 and the government restrictions, I have not been involved in, nor am I aware of, any cases that involve insurance claims that directly relate to losses caused by the impact of COVID-19 on the supply chain.

“Some of the insurance claims we dealt with in the test cases related to losses indirectly caused by supply chain impact – for instance, the international travel ban impacted on the supply chain for travel agents who relied on international travel.”

Rose says, “What’s been very clear is the economic toll from COVID-19 has been huge.

It’s created such a big business impact, and it will require real partnering for businesses and insurers to find the right cover in future.”

For brokers, good conversations to have with clients are around the types of goods they’re now dealing with – has that changed?

– and the methods of transport. In addition, valuations of goods may have changed.

It’s important to remember, too, that the supply chain issues we’ve been facing are still here.

Morrison says, “The risk is still there.

We’re not through this. There might be a problem on a ship that should have arrived two weeks ago and it’s not going to unload for another few weeks. So is there a bit of a backlog of problems that we’re going to find out about soon.”

FEATURE / Natural Disasters

The time for action is now

34 / INSURANCE ADVISER DECEMBER 2021/JANUARY 2022

With incidences of natural disasters escalating, the insurance sector is under increasing financial and physical strain. Insurance is a critical component in disaster response, however, and it’s going to take the involvement of all stakeholders to proactively tackle the growing impact natural disasters are having.

BY MARTIN WANLESS

NIBA.COM.AU / 35

FEATURE / Natural Disasters

N

atural disasters are nothing new here in Australia. From bushfires to floods, storms to earthquakes, we generally run the gamut of weather threats. However, the frequency of those weather events is increasing by the year, and it’s having a significant impact on everyone concerned – from insurance companies to clients, brokers to claims professionals.

“Historically there has been lengthy recovery time between events; however, more recently, this has not been the case,” says Dave Bazen, CEO of Asta Group.

“Exhausted claims personnel – brokers, loss adjusters and insurers – are moving from one event to another with diminishing resources, increasingly unrealistic expectations from clients and little time to manage mental and physical health.”

The facts underline the gravity of the situation. In its 2020 State of The Climate report, CSIRO says Australia’s climate has steadily warmed since records began in 1910, leading to an increase in the frequency of extreme heat events. It also reports a decline of around 16 per cent in April-October rainfall in the south-west of Australia since 1970.

Consequently, over the coming decade we’re projected to see increases in air temperatures, more heat extremes, a continued decrease in cool-season rainfall, an increase in the number of dangerous fireweather days, and a longer fire season for southern and eastern Australia.

However, climate change is driving an increase in the frequency and severity of extreme weather events in the here

“Insurers have paid out more than $8.9 billion in natural disaster claims over that period, with more than $6.1 billion paid out since the 2019–20 bushfires.” and now. The impact of these events may influence the future affordability and availability of insurance in Australia.

“The last three years have driven home just how devastating natural disasters can be,” says Kylie Macfarlane, COO, Insurance Council of Australia.

“Insurers have paid out more than $8.9 billion in natural disaster claims over that period, with more than $6.1 billion paid out since the 2019–20 bushfires.”

36 / INSURANCE ADVISER DECEMBER 2021/JANUARY 2022

THE CHALLENGE POSED TO INSURANCE

There’s no doubt that the insurance sector as a whole has led the way in many respects when it comes to how the country can respond to the impact of climate change and build a more resilient future – and, as a sector, insurance will continue to play a critical role over the coming years.

“The industry does a good job of leading discussions on mitigation, climate change and building resilience,” says Clare Cordingley, Senior Manager – Major Event Response at Sedgwick.

“Resilience and mitigation are topics that have been discussed for many years following natural disasters, and the industry has advocated – and continues to strongly advocate – for disaster mitigation in high-risk communities.

“As the climate continues to evolve, it’s crucial the industry evolves with it and understands not only peril changes but also needs from the customer point of view and how we can support them.”

While at present, according to the ICA’s Macfarlane, no region in Australia is uninsurable, as risks grow, it is possible that some regions may become difficult to insure.

FEATURE / Natural Disasters

Bazen says, “As more events occur, the demand for insurance products will increase as people realise insurance is no longer optional given the high risk of damage.

“If insurers are gradually pulling away from regions or classes of business due to heavy losses, there is going to be a huge disconnect between supply and demand, which will push premiums above the reach for many who need cover.

“This trend is not sustainable, as following this trajectory will threaten the viability of many essential businesses as well as have a significant impact on insurer profitability.”

“The biggest change is for the industry to stop looking at ‘if’ and start planning for ‘when’.”

NEEDED: UNITED PROACTIVITY

For the impact of natural disasters to be managed effectively, a concerted and united effort is needed.

“Affecting lasting improvements to natural disaster exposure in Australia requires increasing funding for both public and private mitigation projects, improving building standards and quality, and making informed land-use planning decisions,” says Macfarlane.

“The Productivity Commission has estimated that 97 per cent of all natural disaster funding in Australia is spent after an event, with just three per cent invested before an event to mitigate the impact of future natural disasters. While recent public expenditure announcements have begun to redress this imbalance, federal and state governments must continue to increase investments mitigating impacts before disaster strikes.”

For all stakeholders, it’s a significant change and one that needs to happen now.

“The insurance industry needs to continue discussions with the Government

and continue to adapt how we respond to major events so that customers are supported in a timely and effective manner,” says Cordingley.

Mitigation strategies are critical, she says.

“There is a need for a broader discussion regarding affordability, building codes and taxes, which if discussed broadly and solutions implemented would allow for better outcomes

2020–21 NAT CATS IN NUMBERS

$2.28bn 133,999 $17,000 incurred

claims

average cost of claim

Claims: 10 per cent commercial 90 per cent personal Event Halloween Hailstorm (QLD) Perth Hills Bushfire (WA) Storm & flood (NSW & QLD) Cyclone Seroja (WA) Storm & flood (WA)

Date October 2020 February 2021 March 2021 April 2021 June 2021

Incurred $1.03bn $93m $652m $281m $230m

Claims 43,210 1102 56,358 6751 26,578

Average claim $24,000 $84,000 $12,000 $42,000 $9000

* ALL FIGURES FROM INSURANCE CATASTROPHE RESILIENCE REPORT 2020–21, INSURANCE COUNCIL OF AUSTRALIA

38 / INSURANCE ADVISER DECEMBER 2021/JANUARY 2022

Local Presence, Global Strength www.brooklynunderwriting.com.au

FEATURE / Natural Disasters

for the policyholder and subsequently the government. The three coincide as enhanced building codes provide greater resilience and can be measured by an insurer for risk profiling.

“A resilient property built to code should then translate to affordable premiums.”

Bazen agrees that a focus on mitigation, together with other strategies, is essential.

“Management of disasters from weather events is not new but dealing with so many in a short period is a relatively recent development. Little change is needed in the fundamental operation of the industry, which is well rehearsed, but improving processes for the mitigation, assessment and reinstatement using developing technology is essential.

“The biggest change is for the industry to stop looking at ‘if ’ and start planning for ‘when’.”

However, he does say that more needs to be done to standardise rules around reinstatement and attract more people into the industry.

“All too often we see the reinstatement phase bogged down with regulatory redtape where Government agencies fail to provide realistic, practical and consistent rulings on acceptable methods of clearing sites and rebuilding,” he says.

“A key outcome would see Governments create standard rules around reinstating damaged buildings and have this communicated to all agencies and the insurance industry, so as to avoid delays or unfair inconsistencies in these decisions.

Investment in attracting new people into the industry would also be a welcome development, particularly in helping improve the image of the insurance industry as a potential career option for school-leavers.”

This is an ongoing discussion within the industry and the broader global community – but it’s particularly pertinent here in Australia.

With natural disasters increasing

“Addressing climate change – the driver of worsening extreme weather events in Australia – is critical.” in frequency and impact, the need for education around steps individuals can take to help reduce the risks they face is incredibly important – and it’s going to require significant change.

“It’s a big change for all stakeholders, not just the insurance industry,” says Cordingley.

“Nevertheless, the insurance industry is well equipped to address climate issues and the increase of natural disasters effectively as this is what insurance is here for.”

Big change starts with millions of individual actions – and, for brokers, that begins with having mitigation strategy conversations with each and every client.

For the Government, bigger challenges

40 / INSURANCE ADVISER DECEMBER 2021/JANUARY 2022

lie ahead over the coming decades.

“Addressing climate change – the driver of worsening extreme weather events in Australia – is critical,” says Macfarlane.

“The Federal Government has an essential role to play in laying out a clear strategy to transition our economy rapidly to Net Zero by 2050.”

The message is clear, though. The time for talking has long since passed – now’s the time for action.

MENTORING

NIBA Mentoring – Promoting Professional Development for 10 Years

WHAT WILL THE PROGRAM DO FOR YOU? For more information and to express interest visit www.niba.com.au/mentoring

COMMUNITY HUB

COMMUNITY HUB NOVEMBER 2021

The COMMUNITY HUB is your space to showcase your products and services to a specialist audience.

INDEX AB Phillips ..................................................... 42 ASR Underwriting...................................... 43 Affinity Insurance Brokers...................... 44 Newline Group............................................ 44 Wellington Underwriting......................... 45

AIBI................................................................... 45 Tudor Insurance Brokers......................... 45 Liberty Specialty Markets........................ 45 Moran Insurance Brokers.........................46 MGA Insurance Group............................. 46

Marsh & McLennan.................................... 47 All Parks Insurance..................................... 47 NIBA advertising......................................... 47

WANT TO ADVERTISE IN THE INSURANCE ADVISER? If you’re a NIBA member with a product or scheme you’d like to promote to a broker audience in our Community Hub section, please contact Tony May E: tmay@niba.com.au

Exclusive timber and sawmill insurance facility AB Phillips has been insuring the Timber and Sawmilling industry for more than 25 years. We have an exclusive underwriting facility which is available to select brokers.

Our insurance facility is for clients in the following sectors: • • • • •

Timber yards Timber storage Timber processors Sawmills Roof truss and wall frame manufacturers

Commission is paid on placements.

For more information please contact Rose Dee on:

Phone: 1800 819 394 | Direct: 03 8586 9316 | Email: rose@abphillips.com.au AB Phillips Pty Ltd. Australian Financial Services Licence No. 234457. ABN: 91 007 075 934. PO Box 832 Moorabbin VIC 3189. 445 Warrigal Rd Moorabin VIC 3189. e: info@abphillips.com.au t: 03 8586 9333 f: 03 8586 9394 w: www.abphillips.com.au

COMMUNITY HUB Key Liability Industries:

Key PI Occupations:

Key FI Occupations:

• Alternate & Complementary medicines • Automotive • Biotechnology • Clinical Trials / Research • Defence – machinery, weaponry & protective equipment • Life Science / Pharmaceuticals • Medical & Surgical Devices (including invasive implants) • Medical Cannabis • Medical Equipment / Products • Mining • Rail, Products, Maintenance, Locomotive Engineering, operators, Rolling Stocks & Engine Manufacturers • Tyres – new, re-threading, lugging, repair & sales • Universities • Veterinary Medicines

• Accountants • Architects • Engineers • Environmental Consultants • Insurance Brokers / Underwriting Agencies • Law Firms • Management Consultants • Miscellaneous Risks • Real Estate Agents • Valuers

• Fund Managers/Investment Managers • Insurance Companies • Managed Investment Schemes • Excess lines for Financial Planners

Chief Executive Officer / Underwriting Manager – Liability

Underwriting Manager - PI

Key D&O • Insured firms can be not-for-profit, privately held or publicly traded • Side A/DIC placements • Medical Cannabis risks • All industry sectors, both commercial and financial, are underwritten

Key Crime Commercial Crime Insurance is also offered alongside other Financial Lines products

Linda Sepala Underwriting Manager – D&O & FI

PH: 03 9998 1900

Newline Australia Insurance Pty Ltd ABN 81 118 089 651 PO Box 16208 Collins St West VIC 8007 PH: 03 9999 1901 FAX: 03 9670 0045 newlinegroup.com.au info@newlinegroup.com.au

AFFINITY AFFINITYEQUINE, EQUINE,ADVENTURE ADVENTURE AFFINITY AFFINITY EQUINE, EQUINE, ADVENTURE ADVENTURE &&LEISURE LEISURELIABILITY LIABILITY & LEISURE & LEISURE LIABILITY LIABILITY

Untitled-2 1 NIBA_Newline_Sep20.indd 1

17/5/21 15/9/2012:40 3:54pm pm

Sports Sports Associations Associations Mountain Biking Biking Equine Equine Associations Associations Mountain Abseiling Abseiling Sports Sports Associations Associations Mountain Mountain Biking Biking Equine Equine Associations Associations Abseiling Abseiling SeaSea Kayaking Kayaking Orienteering/Rogaining Orienteering/Rogaining Equine Equine Events Events Accommodation Accommodation Sea Kayaking Sea Kayaking Orienteering/Rogaining Orienteering/Rogaining Equine Equine Events Events Accommodation Accommodation Scuba Scuba Paddle Paddle Boarding Boarding Equine Equine Therapists Therapists Agistment Agistment Scuba Scuba Paddle Boarding Boarding Equine Therapists Agistment Agistment Snorkelling Snorkelling Pony Pony Rides Rides Farriers Farriers & Therapists Dentists & Dentists Paddle Animal Animal & Petting & Petting Zoo ZooEquine Snorkelling Snorkelling Pony Pony Rides Rides Farriers Farriers & Dentists & Dentists Animal Animal & Petting & Petting Zoo Zoo Snow Skiing Skiing Paintball & Skirmish & Skirmish Snow Fishing Fishing & Boat & Boat Cruises CruisesPaintball Archery Archery Snow Snow Skiing Paintball Paintball & Skirmish & Skirmish Fishing Fishing & Boat & Boat Cruises Cruises Archery Archery Surfing SurfingSkiing Riding Schools Schools Four Four Wheel Wheel Driving Driving Riding Bush Bush Walking Walking Surfing Surfing Riding Schools Schools Four Four Wheel Wheel Driving Driving Riding Bush Bush Walking Walking Swimming Swimming River River Rafting Rafting Flying Flying Fox Fox Camping Camping Swimming Swimming River River Rafting Rafting Flying Flying Fox Fox Camping Camping Trail Trail Running Running Rock Climbing Climbing Horse Horse Carriage Carriage Driving DrivingRock Campsites Campsites Trail Trail Running Running Rock Rock Climbing Climbing Horse Horse Carriage Carriage Driving Driving Campsites Campsites Ropes Ropes Course Course Horse Horse Trainers Trainers Canyoning Canyoning Ropes Ropes Course Course Horse Horse Trainers Trainers Canyoning Canyoning Rowing Rowing Initiatives Initiatives Caving Caving Rowing Rowing Initiatives Initiatives Caving Caving Sailing Sailing Kayaking Kayaking Team Team Building Building Sailing Sailing Kayaking Kayaking TeamTeam Building Building

44 / INSURANCE ADVISER AUGUST 2021

1300 1300 130 130 535 535 1300 1300 130 130 535 535 www.affinityib.com.au www.affinityib.com.au www.affinityib.com.au www.affinityib.com.au Affinity Affinity Insurance Insurance Brokers Brokers is an is Authorised an Authorised Representative Representative (No 1288354) (No 1288354) of Aon of Risk Aon Risk Services Services Australia Australia Limited Limited AFSLAFSL 241141 241141 Affinity Affinity Insurance Insurance BrokersBrokers is an Authorised is an Authorised Representative Representative (No 1288354) (No 1288354) of Aon Risk of Aon Services Risk Services Australia Australia Limited Limited AFSL 241141 AFSL 241141

COMMUNITY HUB

�aibi

Adult Industry Business Insurance

Wellington Underwriting Agencies specialise in labour hire/recruitment, complex liability risks and niche property solutions.

Labour Force includes Broadform Liability, Professional Indemnity and Management Liability and has been developed for: • labour hire companies • recruitment companies • group training and registered training organisations Our Combined General Liability wording has been tailored for complex risks including: • construction • manufacturing • rail • resource sector; and • other hard to underwrite risks Wellington’s Property capabilities are focussed on niche exposures including: • catastrophe-exposed properties • mining sector

AIBI is a registered trading name of Thurston Insurance Brokers Pty Ltd. Thurston Insurance Brokers Pty Ltd is a Corporate Authorised Representative of McLardy McShane Partners Pty Ltd, Australian Financial Services Licence No 232987 ABN 14 064 465 309.

McLardy McShane Partners Pty Ltd is a member of The Steadfast Group.

Contact our Underwriters today or visit our website at

www.wellingtonu.com.au

Benefits of dealing with LSM:

Demolition and Asbestos Removal Liability Insurance Contact us for a confidential review of your clients insurance needs.

$20M Asbestos Liability now available Security of dealing with local office of a major insurer Local claims and underwriting service working closely with you to meet your clients business needs Automatic addition of Errors & Omissions coverage when Asbestos Liability is purchased

service@tudorinsurance.com.au

You can also apply for enhancements when you purchase this policy - coverage for Statutory Fines & Penalties, coverage for Shoring & Underpinning and coverage for transportation of asbestos (clean-up-costs)

(03) 9707 3033

15% commission of all placements

Tudor Insurance Australia Cameron McKerchar tudorinsurance.com.au

NIBA.COM.AU / 45

COMMUNITY HUB

46/ INSURANCE ADVISER DECEMBER 2021/JANUARY 2022

COMMUNITY HUB

MARSH& MCLENNAN A G E N C Y OUR INSURANCE PRODUCTS INCLUDE:

■ ■ ■ ■ ■ ■ ■

Demolition & Asbestos Liability - demolition, asbestos removal and transport, asbestos and environmental consultancies and similar occupations Kidnap, Ransom & Extortion Personal Accident & Illness Income Protection Motor Trades - public and products liability Tyre Retailers - property Window Cleaners - public and products liability

PLEASE VISIT OUR WEBSITE, AND CLICK ON "PRODUCTS AND SERVICES" FOR MORE DETAILS www.marshmc.com.au

CONTACT Michael Beveridge

08 8385 3630 or

Tara Nadge

08 8385 3583 enquiries@marshmc.com

Advertise with the most influential and trusted voice in the Australian intermediated insurance industry · Insurance Adviser · Insurance and Risk website · Broker Buzz · Need a Broker website · Targeted eDMs · NIBA events (Annual Convention)

Marsh and McLennan Agency Pty Ltd ABN 33 000 668 584 / AFSL 238984

517-3776

Contact Tony May National Advertising Sales Manager T: 02 9459 4303 E: tmay@niba.com.au

NIBA.COM.AU / 47

INSURER STRENGTH RATINGS

S&P GLOBAL

AUSTRALIA

INSURER FINANCIAL STRENGTH RATINGS

RATING

NON-LIFE INSURERS AAI Ltd.

A+/POSITIVE

AIG Australia Limited

A/CreditWatch Negative

Allianz Australia Insurance Ltd.

AA-/STABLE

BHP Billiton Marine & General Insurances Pty Ltd.

A/CreditWatch Negative

Chubb Insurance Australia Ltd.

AA-/STABLE

Great Lakes Insurance S.E (Australia Branch)

AA-/STABLE

Hallmark General Insurance Co. Ltd.

BBB+/STABLE

Insurance Australia Ltd.

AA-/STABLE

A+/POSITIVE

Society of Lloyd's

A+/STABLE

AIG Insurance New Zealand Ltd.

A/CreditWatch Negative

Medical Insurance Australia Pty Ltd.

A-/STABLE

Chubb Insurance New Zealand Ltd.

AA-/STABLE

QBE Insurance (Australia) Ltd.

A+/STABLE

QBE Insurance (International) Ltd.

A+/STABLE

Zurich Australian Insurance Ltd.

AA-/STABLE

The following is a list of S&P Global Ratings insurer financial strength ratings assigned to insurance companies in Australia and New Zealand. Ratings at 1 November 2021.

Contact: Craig Bennett, S&P Global Ratings Telephone: 03 9631 2197

NEW ZEALAND

RATING

NON-LIFE INSURERS AA Insurance Ltd.

Hallmark General Insurance Co. Ltd. (NZ Branch) BBB+/STABLE IAG New Zealand Ltd.

AA-/STABLE

Society of Lloyd's

A+/STABLE

Medical Insurance Society Ltd.

A-/POSITIVE

Genworth Financial Mortgage Insurance Pty Ltd.

A/NEGATIVE

Southern Cross Benefits Ltd.

A/STABLE

QBE Lenders' Mortgage Insurance Ltd.

A/STABLE

Southern Cross Pet Insurance Ltd.

A/STABLE

Westpac Lenders Mortgage Insurance Ltd.

A/NEGATIVE

Teleco Insurance (NZ) Ltd.

BBB+/STABLE

LIFE INSURERS

Vero Insurance New Zealand Ltd.

A+/POSITIVE

AIA Australia Ltd.

A+/STABLE

Vero Liability Insurance Ltd.

A+/POSITIVE

AMP Life Ltd.

A-/STABLE

Challenger Life Company Ltd.

A/STABLE

Hallmark Life Insurance Co. Ltd.

BBB+/STABLE

MetLife Insurance Ltd.

A+/STABLE

Westpac Life Insurance Services Ltd.

A+/STABLE

QBE Insurance (Australia) Ltd. (New Zealand Branch) A+/STABLE

HEALTH INSURERS Southern Cross Medical Care Society

A+/STABLE

NIB NZ Ltd.

A-/STABLE

LENDERS MORTGAGE INSURERS Genworth Financial Mortgage Insurance Pty Ltd. (NZ Branch)

LENDERS MORTGAGE INSURERS

REINSURERS A/NEGATIVE

General Reinsurance Australia Ltd.

AA+/STABLE

LIFE INSURERS

General Reinsurance Life Australia Ltd.

AA+/STABLE

Asteron Life Ltd.

A+/POSITIVE

Hannover Life Re of Australasia Ltd.

AA-/STABLE

Hallmark Life Insurance Co. Ltd. (NZ Branch)

BBB+/STABLE

Munich Reinsurance Co. of Australasia Ltd.

AA-/STABLE

Medical Life Assurance Society Ltd.

A-/POSITIVE

RGA Reinsurance Co. of Australia Ltd.

AA-/STABLE

Westpac Life-NZ-Ltd.

A+/NEGATIVE

SCOR Global Life Australia Pty Ltd.

AA-/STABLE

Resolution Life New Zealand Ltd.

A-/STABLE

Swiss Re Life & Health Australia Ltd.

AA-/NEGATIVE

*For the S&P Global Insurer Financial Strength Ratings Definitions visit: https://www.niba.com.au/resource/standardandpoors.pdf Copyright © 2021 S&P. This material is reproduced with the permission of S&P. Reproduction of this the S&P Information in any form is prohibited without S&P’s prior written permission. Neither S&P, its affiliates nor any of their thirdparty licensors: (a) guarantee the accuracy, completeness or availability of the S&P information, or (b) make any warranty, express or implied, as to the results to be obtained by Insurer Financial Strength Ratings or any other person from the use of the S&P information or any other data or information included therein or derived therefrom, or (c) make any express or implied warranties, including any warranty of merchantability or fitness for a particular purpose or use, or (d) shall in any way be liable to Insurer Financial Strength Ratings or any recipient of the S&P information for any inaccuracies, errors, or omissions, regardless of

48 / INSURANCE ADVISER DECEMBER 2021/JANUARY 2022

cause, in the S&P information or for any damages, whether direct or indirect or consequential, punitive or exemplary resulting therefrom.

Ratings are statements of opinion, not statements of fact or recommendations to buy, hold, or sell any securities. S&P Global (Australia) Pty. Ltd. holds Australian financial services licence number 337565 under the Corporations Act 2001. S&P Global credit ratings and related research are not intended for and must not be distributed to any person in Australia other than a wholesale client (as defined in Chapter 7 of the Corporations Act). Ratings are based on information received by Ratings Services. Other divisions of S&P Global may have information that is not available to Ratings Services.

INSURER STRENGTH RATINGS

NEW ZEALAND

BEST’S

FINANCIAL STRENGTH RATINGS

RATING

COMPOSITE Quest Insurance Group Limited

B/STABLE

LIFE, ANNUITY AND ACCIDENT American Income Life Insurance Company (New Zealand Branch)

A/STABLE

BNZ Life Insurance Limited

A u/NEGATIVE

CIGNA Life Insurance New Zealand Limited

A u/POSITIVE

Co-operative Life Limited

B++/STABLE

DPL Insurance Limited

B++/STABLE

Fidelity Life Assurance Company Limited

A- u/DEVELOPING

Foundation Life (NZ) Limited

A-/STABLE

General Reinsurance Life Australia Limited (New Zealand Branch)

A++/STABLE

LIFE, ANNUITY AND ACCIDENT

Kiwi Insurance Limited

A- u/DEVELOPING

General Reinsurance Life Australia Ltd.

Momentum Life Limited

B++/STABLE

Partners Life Limited

A- u/DEVELOPING

Pinnacle Life Limited

B/STABLE

The following is a list of AM Best Financial Strength Ratings (FSRs) assigned to insurance companies in Australia and New Zealand. Ratings as at 10 November 2021.

Contact: Mr. Scott Ryrie Managing Director & Co-CEO A. M. Best Asia-Pacific (Singapore) Pte Ltd. Tel: +65 9636 3678 Email: scott.ryrie@ambest.com

AUSTRALIA

RATING A++/STABLE

PROPERTY/CASUALTY Ansvar Insurance Limited

A-/NEGATIVE

First American Title Insurance Company of Australia Pty Limited

A/STABLE

General Reinsurance Australia Ltd

A++/STABLE

Aioi Nissay Dowa Insurance Company, Limited (New Zealand Branch)

A+/STABLE

Guild Insurance Limited

A-/NEGATIVE

Beneficial Insurance Limited

B++/STABLE

Pacific International Insurance Pty Limited

B++/NEGATIVE

Brightsideco Insurance Limited

B/STABLE

The Hollard Insurance Company Pty Ltd

A-/STABLE

Consumer Insurance Services Limited

B+/STABLE

The New India Assurance Company Limited (Australia Branch)

B++/STABLE

First American Title Insurance Company of Australia Pty Limited (New Zealand Branch)

A/STABLE

FMG Insurance Limited

A/STABLE

General Reinsurance Australia Ltd (New Zealand Branch)

A++/STABLE

Health Services Welfare Society Limited

B+/NEGATIVE

Mitsui Sumitomo Insurance Company Limited (New Zealand Branch)

A+/STABLE

Rating Disclosure: Use and Limitations: A Best’s Credit Rating (BCR) is a forward-looking independent and objective opinion regarding an insurer’s, issuer’s, or financial obligation’s relative creditworthiness. The opinion represents a comprehensive analysis consisting of a quantitative and qualitative evaluation of balance sheet strength, operating performance and business profile or, where appropriate, the specific nature and details of a security. Because a BCR is a forward-looking opinion as of the date it is released, it cannot be considered as a fact or guarantee of future credit quality and therefore cannot be described as accurate or inaccurate. A BCR is a relative measure of risk that implies credit quality and is assigned using a scale with a defined population of categories and notches. Entities or obligations assigned the same BCR symbol developed using the same scale, should not be viewed as completely identical in terms of credit quality.

Alternatively, they are alike in category (or notches within a category), but given there is a prescribed progression of categories (and notches) used in assigning the ratings of a much larger population of entities or obligations, the categories (notches) cannot mirror the precise subtleties of risk that are inherent within similarly rated entities or obligations. While a BCR reflects the opinion of A.M. Best Rating Services, Inc. (AMBRS) of relative creditworthiness, it is not an indicator or predictor of defined impairment or default probability with respect to any specific insurer, issuer, or financial obligation. A BCR is not investment advice, nor should it be construed as a consulting or advisory service, as such; it is not intended to be utilised as a recommendation to purchase, hold or terminate any insurance policy, contract, security, or any other financial obligation, nor does it address the suitability of any particular policy or contract for a specific purpose or purchaser. Users of a BCR should not rely on it in making any investment decision; however, if used, the BCR must be considered as only one factor.

Users must make their own evaluation of each investment decision. A BCR opinion is provided on an “as is” basis without any expressed or implied warranty. In addition, a BCR may be changed, suspended, or withdrawn at any time for any reason at the sole discretion of AMBRS.

PROPERTY/CASUALTY

New Zealand Medical Indemnity Insurance Limited B+/STABLE Pacific International Insurance Pty Ltd (New Zealand Branch)

B++/NEGATIVE

Police Health Plan Limited

A-/STABLE

Provident Insurance Corporation Limited

B /STABLE

The Hollard Insurance Company Pty Ltd (New Zealand Branch)

A-/STABLE

The New India Assurance Company Limited (New Zealand Branch)

B++/STABLE

Tokio Marine & Nichido Fire Insurance Company Limited (New Zealand Branch)

A++/STABLE

Tower Insurance Limited

A-/STABLE

Union Medical Benefits Society Limited

A/STABLE

Virginia Surety Company, Inc. (New Zealand Branch)

A/STABLE

NIBA.COM.AU / 49

EVENT / Pictorials

NIBA UAC WA UNDERWRITING EXPO The National Insurance Brokers Association (NIBA) and Underwriting Agency Council (UAC) WA Underwriting Expo saw 22 exhibitors of the local WA market, and over 220 delegates participate. The NIBA Team has thanked all the attendees for making this event a resounding success.

50 / INSURANCE ADVISER DECEMBER 2021/JANUARY 2022

BE PART OF NIBA Advertise with the most influential and trusted voice in the Australian intermediated insurance industry ·Insurance Adviser

· Insurance and Risk website · Broker Buzz · Need a Broker website · Targeted eDMs · NIBA events (Annual Convention)

WE ARE YOUR VOICE Contact Tony May National Advertising Sales Manager E: tmay@niba.com.au

Behind you for what’s ahead Choices matter.

At Allianz, we choose to be behind our customers and our partners, so they can have confidence in tomorrow. 100 years and counting, we’re behind you for what’s ahead.

Allianz Australia Insurance Limited ABN 15 000 122 850