We at Miller live by our belief that local insurers are invaluable partners. As part of our Energy insights series, we interviewed Chief Operating Officer of Al Madina Insurance Company, Ajay Srivastava, on the roles of local insurer and international broker in the value chain.
What do clients want from their local insurance company?
They rely on their local insurer’s expertise on all fronts, right up to placement. They want us to act as their continuing voice to the reinsurance market, particularly on claims. They also want training, and engagement with their own team on the finer aspects of insurance.
And from an international broker?
A proven track record of success when handling and paying large claims in the region. The broker’s standing, size, and experience in placing similar specialty global risks in the international market is important, but they want them to be accessible, too.
On top of that, they want an international broker with in-house risk engineering capabilities, the ability to deliver risk engineering surveys, and the breadth to benchmark against similar global clients. They expect access to all types of solutions, and want their broker to put them on the table in a transparent manner, but to keep it uncomplicated.
Finally, they want the international broker to have solid access to rated reinsurance securities that offer a cost-effective premium for a technically and commercially feasible solution. Transparency throughout the pricing negotiation and placement process is an expectation.
Do clients value a local service provider?
It’s essential. Policies must be issued and written locally as per regulations. Insurance law in almost all countries, including Oman, recognises the important role of international companies in risk transfer, but places ultimate liability for client service and claims with the local insurer.
We also fill our clients’ insurance knowledge gaps, since at most companies, even the largest, insurance is managed by a very small team or sometimes just a single individual whose core responsibility lies elsewhere. This is particularly important for coverage which falls outside standard policy forms.
International brokers and risk carriers also value local providers. Our local client relationships allow us to understand their history and needs in detail. We pass that critical knowledge through the reinsurance broker to underwriters. So, the local company acts as an insurance consultant, delivering local knowledge and international expertise in either direction.
How important is it to work closely with an international broker?
Again, it’s essential. They have the expertise, experience, market reach, and rapport with specialist global underwriters that allows risks to be placed properly, informed by their knowledge and awareness of global trends related to specific risk types. But this is also a two-way street, a real partnership. With all their impressive capabilities, the broker still needs plenty from the local insurer. So large energy risks demand a close working relationship between the client, the insurer, the international broker, and the reinsurer. To get the best, clients must see all three as partners.
You mentioned claims. How do the partners collaborate on them?
A unified claims service with transparent processes is the fastest and most efficient mechanism to settle claims. The local insurer reaches out to the client and takes them through the process. It’s our job to ensure required procedures are spelled out, and markets are advised swiftly so experts can arrive and get on with loss assessment. It’s critical to keep the client engaged, manage expectations, and explain how the policy will respond as it is tested.
The international broker’s experience handling multiple claims across different geographies and working with international markets is invaluable when representing our clients’ claims most effectively to reinsurers. So we all have a role in the unified claim service which, when well executed, meets client expectations throughout the claims cycle.