Airmic

Risk managers overwhelmingly support the idea of a willingness-to-pay index

Risk managers overwhelmingly support the idea of a willingness-to-pay index for insurers, according to a survey of AIRMIC members published at the association's annual conference.

Asked whether they backed the idea, 69% replied yes, with just 12% against and 19% not sure.

Earlier this year, AIRMIC chairman Geoff Taylor described insurer willingness to pay as one of the association's new priorities. Technical Director Paul Hopkin has completed preliminary work on creating an index, scoping out the main criteria and logistical issues. Incoming chairman Colin Campbell today reaffirmed commitment to the project.

"As far as risk managers are concerned willingness to pay can be every bit as important as the ability to do so. There are rumours - and that may be all they are - that some companies are better than others in this respect. We seek hard evidence, and we expect that our efforts will ultimately help to drive up standards."

The survey shows a substantial level of concern among commercial insurance buyers over the way claims are paid. Fewer than half rated their insurers good or excellent in respect of claims handling speed and accuracy (42%) and slightly more than half in respect of adequacy of claims procedures and resources (56%).

A quarter of the sample had had a claim refused by their insurer within the past two years, whilst half had had one referred to insurer senior management.

Market performance
In other aspects risk managers are mainly happy with the service they receive from the industry. 79% consider insurer performance good or excellent in respect of cost of cover and deductible levels, 77% in respect of coverage offered.

82% considered support from their brokers in respect of price and coverage obtained to be good or excellent, 69% in respect of service and support.

Broker transparency
The results confirm previous findings that AIRMIC members are getting much improved broker transparency. 38% described the willingness of their broker to disclose their remuneration as excellent, 36% as good and just 6% as poor.

"We still have some way to go until we get the total broker transparency we desire, but this survey demonstrates how much the situation has been transformed over the past few years, at least among the buyers that we represent," said Campbell.

Emerging concerns
Business continuity planning, environmental exposures, reputation and contractor exposures are the issues emerging most rapidly amongst the concerns of AIRMIC members (see below).


AIRMIC members spend more than £5bn p.a. on insurance premiums. The survey took part in the second half of May, with 135 taking part. AIRMIC's conference, "Competitive advantage through risk management," takes place at the QE2 Conference Centre, Westminster from June 5-6. AIRMIC represents risk managers in the UK, including 75% of FTSE 100 companies.



For further information contact Mark Baylis, +44 (0) 23 8034 9719, +44 (0) 7775 693994, markbaylis@aol.com