US insurers ‘doubling down’ on broker commitment – Guidewire CEO

US insurers are ‘doubling down’ on their commitment to brokers, Guidewire chief executive Marcus Ryu says.

Speaking at a briefing at Guidewire Connections conference in Las Vegas, Ryu was asked about the potential rise of direct buying in the US and its impact.

Ryu said US insurers were cautious about launching too quickly into direct buying and remained committed to brokers.

“Almost every customer we have that has an intermediated model, is doubling down on that model and is not retreating on it,” he said.

“But the theory is to engage the adviser, the agent, the broker to be part of an omni-channel experience for the policyholder. We have to give them more tools, better information.

“We have to give them the ability to serve the policyholder better and more efficiently and unburden them of some of the administrative busy work that doesn’t add any value.

“Give them other tools such as Salesforce automation, to keep track of their tools better. Set up a shingle so they can market themselves as a small business brand under a big carrier in case of the big captive agents.

“There are all these different strategies that are about empowering the broker through digital means as opposed to displacing them with just a direct channel.”

In a wide-ranging interview with brokers, Ryu was asked why direct hadn’t taken off in the US in the same way as it had in the UK.

But Ryu said international insurers were aware of going too speedily into direct, wary that customers might not be ready for it and it could lead to the race to the bottom.

He said the UK was an example where direct buying, and purchasing through aggregators, had left pushed down prices but service languished behind other countries.

He said many insurers see it as the ‘road to perdition’.

However, he stressed that there was still an opportunity for growth, and Guidewire’s small business proposition to help insurance firms connect directly with the customer was being used by Nationwide