Page 42 - MARKETING & PUBLIC RELATIONS EBOOK IC88

(b) Other insurance intermediaries

1. Brokers, in the insurance business, are different from agents. They are independent business
firms. They may be companies, cooperative societies or limited liability partnerships. They have
to Hass prescribed examinations and obtain licences from the IRDA. They try to understand the
needs of the customers and find an insurer who can meet that need. They may even try to
develop a unique product and find an insurer to offer that product and mediate in the
negotiation of price.

2. Brokers may be found in the non-life insurance business helping customers whose insurance
requirements are complex. They handle big risks and need superior financial and analytical skills.
Brokers are not limited to only one insurer. Worldwide, brokers are intermediaries in the
reinsurance business. Their services may be used by many ceding insurers as well as by many
reinsurers in different countries.

(c) Importance of intermediaries in insurance

1. Agents and other intermediaries are important in the distribution of the insurance business. The
decision to buy insurance is an important decision for most people. It is also a difficult decision.
The difficulty arises partly because people have limited knowledge about insurance. In life
insurance, the commitment is for a long period of time. In such situations the level of
involvement is high in the decision process. The decision is not made in a hurry. The agent is
seen as a knowledgeable person. His advice and opinions are valued.
2. The general image of an insurance agent has not been good.
3. The perception also is that the job of an agent is difficult.
4. To be worthy of this trust, the agent's advice must take a holistic approach to the buyer's needs
and suggest a package for total financial planning that may, if necessary, include products other
than that of insurance.
5. The transaction really begins when the policy is sold and becomes complete only at the time of
the claim.
6. The other intermediaries at the stage of the claim are
 In the case of general insurance, surveyors and loss assessors, who are independent
professionals, who are called upon to inspect the damages and losses claimed against, in
order to determine (i) that the claim is payable and (ii) what the amount of the
claim should be. An excess payment would be unfair to the other policyholders. The law
requires that every claim exceeding Z 1 lakh, must be surveyed and an assessment
report obtained before deciding on the claim.
 Motor Accident Claims Tribunal to adjudicate on the quantum of compensation that
should be paid to the victims (third parties) of motor accidents.
 Lok Adalats, consisting of judges, to enable expeditious summary disposal of long
pending disputes regarding claims.

Sashi Publications Pvt Ltd Call 8443808873/ 8232083010