This document summarizes the results of a survey of 55 insurance brokers on tools and challenges for serving small and medium-sized businesses. Key findings include: brokers have little time after initial sale to engage clients; clients want tailored commercial products but often receive standardized personal lines; brokers need immediate online access to client policy, billing and claims data; and both brokers and clients want simpler processes and a wider variety of specialized coverage options. Overall, the survey highlights the need for insurers to improve digital tools and customize products and services to better meet the unique risks and demands of small and medium commercial customers.

1. © CGI Group Inc. CONFIDENTIAL
NICC 2014 Small Commercial Broker
Survey
CGI
September 2014

2. About NICC
• What is it?
• Who attends?
• The purpose of the panel
• Survey of ORBiT members/non-members open July
to August 30, 2014
• 55 respondents took part in the survey
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3. CFIB Shares Member Feedback on Insurance
About CFIB:
•Non-partisan advocacy organization representing privately-
owned Canadian businesses
•109,000 members in all industry sectors
•50% have < 20 employees; 80% have <5 employees
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4. Small Business Sector in Canada
• Make up 50% of the Canadian economy in terms of GDP
and employment
• Create 50 – 75 % of total net new jobs
• Represents a larger proportion of the economy than in
U.S. and other developed countries
• Churn at a rate of 30-60% every 5 years
• Almost 50% of jobs created in next 15 years will be from
businesses not yet started
• <1% of businesses are fast growing
• High growth firms are more common in low and medium
tech sectors
• Entrepreneurial sweet spot are ages 45-65
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5. The Market Stratification Challenge in
Canada
Which metric do we use to define the strata?
Sources
Note 1: Industry Canada
Other: Premium, Sales and Broker revenue stratification is based on experience in the Canadian commercial
marketplace.
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Canada Premium Sales Employee
Size
Broker
Revenue
Micro < $5K < 5M 1-4 < 1K
Small $5K – $25K $5M - $50M 5-99 $1K - $5K
Medium $25K -
$100K
$50M -
$100M
100-499 $5K - $50K
Large $100K+ $100M+ 500+ $50+

6. Challenges for Small/Medium Sized Business
• Small firms want to be treated as businesses but often
conform more to a retail customer profile
• Costly to serve so tendency is to have a one-size fits all
approach
• Take-up of technology likely to be slower than large
business sector
• Most are not well-informed consumers of insurance
products/services
• Highly price-sensitive
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7. Important Learning from past CFIB
Surveys…
CFIB members say:
•Primary concern is cost
•Packages are not tailored to small business needs
•Heavily reliant upon insurance brokers
•Not being given the full range of options in coverage/cost
•Red tape in claims process is burdensome
•Very loyal to broker/agent
•High satisfaction level with their broker
•Need advice on controlling/managing insurance costs
•Very satisfied with claims service
•Unclear on their rights as a consumer of insurance
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8. Helpful Information
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9. ORBiT NICC Survey Results
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24. What Tools do you need?
“Other” responses:
•Client self-serve quote and bind new business online
•Competitive rates that do not increase annually except for
inflation
•Higher commission on smaller accounts. How possibly can
a professional brokerage manage a client's expectations for
$200 per year in commission. To provide broker services
either requires higher commission or less responsibility
(perhaps like more of an "agent")
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27. Why aren’t you using the tools you have?
“Other” responses:
•Having a clearly defined process for small business
•Comprehensive knowledge and coordination of all the various
ways that the insurance companies offer tools.
•Products are too complex
•Service issues @ the company side - small commercial should be
quick and easy - staffing issues at the company side often draw
the process out
•Dealing with too many renewal questionnaires
•Delivery of tools to the broker for one touch service
•How can a brokerage "commoditize" i.e. have clients DIY when
we are held 100% legally accountable for our clients risks? You
can't provide "RIBO/Broker" type services (think E&O) on a
commoditized/call centre type basis.
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29. What tools are key to write NEW
BUSINESS?
“Other” responses:
•SEMCI is key to future success
•Sales ability and professional counselling to prospects
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31. Acquiring the Small Business
Insurance Customer
“Other” responses:
•Companies only offer online broker tools. need to offer
online client facing quotes
•I may not be aware of the risk appetite
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35. What enhancements are needed?
“Other” responses:
•Broader risk appetite e.g. consultants, internet sales,
etc.
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38. What are clients asking for today?
“Other” responses:
•paying monthly with credit card
•I do not believe demands of small business owners are
changing. I believe the IT world would like us to believe
that. I do not know of any business owner who would
want to manage their own insurance
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39. Survey Conclusions
• Little time to touch their clients after new the sale
• Touch points are on administrative issues
• Products do not meet client needs of
• Standard concepts/ techniques for personal lines
don’t work for small commercial business
• Better segmentation for new specialized coverages
• Liability coverages more popular than property
• Need to move away from the package concept
• Need immediate access claims, billing, and policy
information
• Product lines have little impact on placement
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