by Mark Hutchings, National Account Manager at UInsure

For the insurance industry technology has always been something of a double edged sword. Those brokers and providers who refuse to keep up with technological advancements and stubbornly stick to old-fashioned means of selling and sourcing stand little chance of surviving in the long term. Consumers are becoming reliant on and, indeed, expectant of the type of speed and efficiency technology provides. The clear message to all industries is shun it at your peril.

However, while good brokers will be embracing technology and utilising it in their everyday working lives, many will also be fearful of it. And it’s not hard to see why. Whilst technology can help brokers to offer a more streamlined, efficient service to their clients (thus enhancing their business offering) it can also help consumers to ‘go it alone’, cutting brokers out of the picture altogether.

The obvious example here is comparison sites, which I have discussed on many occasions. However, I read an interesting article in one of the nationals lately that added another technological ‘threat’ into the mix.

The article suggested insurance providers are missing a trick by not allowing consumers to purchase home insurance via apps. It claimed many consumers, particularly those in their twenties and early thirties, would like to buy insurance with just a few clicks and insurers should capitalise on this.

My views on this are mixed. At Uinsure we have always been a technology focused provider, constantly investing time and money in ensuring our systems and facilities offer brokers the type of speed and efficiency needed to compete in this market. As such I am a big fan of moving with the times and incorporating technology into our business lives as much as possible.

However, I am against the idea of buying insurance over an app. Such a facility would cut brokers out of the market. As a huge supporter of the intermediary market I would not support any developments that are detrimental to the livelihoods of brokers.

But my disapproval of the article’s suggestion goes further than that. I also believe that if consumers could buy insurance via an app it could be detrimental to them.

The financial services industry is a serious business. The products are serious financial agreements that should not be entered into lightly. Such products should not be available to buy with ‘just a few clicks’. They should not be something you can pick up while killing some time on your phone on your lunch break or during a train journey. They should only be taken out after due consideration has been given to them.

Don’t get me wrong, the actual process of sourcing the product should be straightforward and fast but we should only get to that point after careful consideration and research, something which can’t be guaranteed if a consumer can open an app and buy a policy in just a few minutes. And that’s where brokers come in. I have spoken many times on the immeasurable value of good advice. There is no substitute for a good broker.

Technology should most certainly be embraced by the whole of the financial services industry but providers and lenders should bear in mind the need for customers to be well informed, not least from a compliance point of view, before developing applications that could leave them at risk.