The Middle Man
In recent times there has been a tendency or a move by some of the 'Big Gorillas' to cut out the middle man. Most significant in this trend has been Insurance companies dispensing with the services of independent brokers and some airlines cutting ties with travel agents. The idea is to force you to go direct to the service provider. The rationale that they present to YOU is that YOU will save money because these middle men will no longer get a piece of the action. And you will be in line to get some of that money back.
You will probably also notice that these companies, especially insurance companies, now shOUT long and loud from just about every media platform there is.
The question that springs to mind is....."
"Are these companies perhaps not simply paying to advertising agencies what they may otherwise have paid in commissions to independent brokers, and that YOU are in fact NOT getting a better deal?"
If this is the case there are three observations that must follow.
>>>When a broker delivers a client to an insurance company it comes with 100% guarantee of custom ( his client.) To get the client, the broker has to use his own resources and marketing skills to bring a client to the insurance company. It does not cost the insurance company a single cent until a client is delivered.
>>>In excluding the services of the broker, the insurance company now has to assume the role of the broker to find new clients. Hence the flurry of advertising and promises, promises, promises......!
>>>If you follow up on one of those advertising messages you will find yourself talking to someone at a call center. Someone who has been carefully instructed in the art of delivering a glowing but one sided account of all the positive features of the plan on offer. Unfortunately YOU may not be as well schooled as perhaps a broker might be in the interpretation of the small print.
So, how do you know if you are in fact getting a good deal?
Some of the marketing plans used by insurance companies dwell heavily on what you will 'get out' after a number of years if you do not claim.  These ads are often accompanied by pictures of people arriving home with snooker tables, ski boats...goodies which don't come cheap!  Sometimes  big numbers are bandied about....'Over R30,000,000 has been paid out to happy smiling customers over the last x years....' If this company has say 30,000 customers it would pay out R1000 per customer over x years.
Not too many will be coming home with big boys toys.  Not too many brokers would be feasting on fillet steak if that was the extent of their remuneration.
If brokers are unable to survive because their income stream has been snuffed out they are left with few options. Of course one option, since they are already well schooled in this business, will be join a call center operated by one of the 'Big Gorillas'.
It seems to me that if we support this kind of action WE will all be worse off.  Not just because small businesses ... SOHOs ... are destroyed but because we'll end up being less informed and with fewer choices.   And yet again, the big Gorillas will be stomping all over us!
Please join us .... if only to help us make sure that this does not happen.
WWCTN invites any member who feels that they have had a bad deal or unsatisfactory service from their insurance company to tell us all about it. We will share it with everyone in our community in the interest of compelling insurers to deliver a fair deal..... or lose our custom.
Cut Out....
Maybe you should consider joining...
SA Bank,  Insurance and Financial Customers Association.
(SABIAFCA)
WinWinCommunity.com