Markerstudy defends broker TOBA change

Markerstudy underwriting director Gary Humphreys says the one hour reporting of an accident claim will improve claims handling performance.

Markestudy changed its Terms of Business Arrangement (TOBA) in August to declare that brokers should report to the insurer all notifications of a claim, within an hour of it being received. Failure to do so could result in a cancellation of the TOBA agreement.

Humphreys said too often Markerstudy receives notification of the claim late in the process, by which time the accident management companies have sown up all the arrangements.

He said: “We just want to ensure that the broker doesn’t just hand it over without there being any standards in place as to how those claims will be handled and reported.

“Historically, one or two people have been tempted into deals which all about income but not about how the performance of the claim is handled.”

However, Biba technical services manager Steve Foulsham criticised the change.

Foulsham said: “We think to put an amendment to a TOBA which effectively requires a broker to notify a claim within one hour is quite frankly, ludicrous.

“Whilst we are seeing a number of insurers looking at first notification of loss and trying to make sure they understand any other arrangements which the broker may have in place for notification, then it’s more a question of working with the broker to come to an equitable solution rather to put something is which is unworkable.

“Clearly, with an hour to notify if the broker even over a weekend relies on answer phone messages, clearly there are going to be difficulties there. It can’t be practical.

“What we would like to see is Markerstudy engaging with the broker community to try and find a better solution.

“We’re starting to see quite a few amendments to TOBAs, the next thing beyond FNOL could be something around ELTO where there will be sanctions on insurers come next April and it wouldn’t surprise me if we start to see insurers try and include something in TOBA’s relative to brokers responsibilities.”

Markerstudy joins Ageas, Zurich and Provident in making changes to TOBAs as insurers strive to have a better understanding and control of the accident management process.