Smaller Brokers Can Add Up To Better Service

BY MARK E. RUQUET
NU Online News Service, March 25, 3:10 p.m. EDT

Size does not necessarily equate to better service, as some smaller brokerage firms perform better than larger competitors, according to a survey of risk managers.

Consulting firm Greenwich Associates said that when it comes to the quality of client service, its poll of 714 risk managers gave the edge to five national brokerage firms, over the top three global brokers.

All of the brokers that were looked at in the study had sales of more than $500 million.

The Greenwich, Conn.-based company said its survey asked risk managers at large corporations to rate the quality of the brokers in a range of product and service categories. The firm said the most important drivers of client loyalty were overall service quality, price/value and a broker’s ability to understand the client.

From interviews conducted with these risk managers the global operations of Marsh, Aon and Willis were rated as giving average client service quality. In that group were also listed Lockton, Hilb, Rogal & Hobbs and Wells Fargo.

Five brokers that received above-average client service quality marks were Arthur J. Gallagher, BB&T, Beecher Carlson, Integro and Wortham Group.

Five national brokers were listed as below average, but they were not identified.

Greenwich said the rating is a composite of 19 “distinct broker performance factors.”

The importance of service, said Bill Bruno, Greenwich Associates consultant, is that it develops strong relationships and less pressure on risk managers to feel the need to switch brokers.

“As company management and boards become more sensitive to, and responsible for risk management issues and service quality benchmarks, they are more inclined to switch brokers and carriers if they do not feel they are getting adequate value,” he said in a statement.

“Relationships are up for grabs in a way the market has never before seen. This can be viewed as an opportunity or a risk depending on your strategy,” said David Fox, Greenwich Associates consultant.