Managing Director (Allied Insurance Brokers)

As you know, the first things that an investor looks for prior to investing in a foreign country are a trustworthy lawyer, bank and insurance company. How would you describe Jamaica’s insurance industry today?

In Jamaica, insurance companies are governed by the Financial Services Commission – they may conduct audits on the insurance company/broker without reason and has strict guidelines that must be followed. For example, we must file our returns, including the quarterly financials and if not done, the company will be reminded in writing and can be penalised. Given that insurance is an intangible commodity, no insurance company can afford to have that kind of reputational damage. Based on that standpoint alone, insurance companies and brokers have integrity as their mantra. At Allied, we are firm on our core values of honesty, integrity and trust, so we do exist on that basis as well.

Established in 1969, Allied Insurance Brokers (AIB) is a wholly owned subsidiary of GraceKennedy Limited. How is the company positioned in the local insurance industry and what would you say are the reasons behind AIB’s success over the past four decades?

GraceKennedy is well received in the Jamaican market and overseas, as well in the food industry. In terms of the financial sector, Allied has built its reputation on professionalism, transparency and honesty in dealing with our customers.

Allied holds its market share in terms of commission income, although we collect all premiums, our earnings are only commission based. Therefore, in terms of commission income, the FSC will use those results to prepare an annual report that would show the broker’s market position. The last one was done in 2012 and up to then, Allied’s market share was about 22% of the local market in comparison to our competitor who were in their teens.

In the area of employee benefits, we are not leading in that section, as there are companies that specialise in employee benefits. Presently, our market share is in single digit and our plan is to grow this line of business as well.

The insurance industry in Jamaica and around the world is fiercely competitive. What differentiates AIB from other brokers? Why is AIB a customer’s premier insurance intermediary and a partner’s broker of choice?

Allied has the highest number of qualified staff with the ACII professional designation in Jamaica. The American designation of insurance is not as recognised as the British, and our policies are based on the English system. Under one roof, we have the most qualified persons and from a technical perspective, we can handle certain complicated risks. Hence, Allied has an extremely good reputation, both with the insurers and just as importantly with our customers.

As an added value, we have an in-house skill where we will visit the clients’ premises and conduct a survey on their risk and exposure. We would provide the report to the client for them to improve their premises and reduce exposures. At a later point, we would return to the premises and assess it, rather than to take the client as they are with, for example, exposed gas, something that might need fixing or a drainage issue. Without the assistance of the survey, when the information is presented to an insurer, the client will be in less than satisfactory position because they will be charged or penalised as a result of the high-risk exposure. In addition to our surveying capacity, our employee that does the surveying is qualified in Europe and has worked with the major insurance companies in Europe. We not only place risks in Jamaica, but also in the London market as well and so having that kind of team member here allows us to access certain markets. We have solid credibility and so we are able to get competitive terms from the overseas market.

In addition to that and with Allied being a broker, our earnings are commission based, so one would think that we charge a higher premium to make a higher commission. But actually, we sell a product called “In Check”. It is a wellness program that we give to our clients for free for the first year. We pay their bills for free for the first year to manage the health of their organisation, in terms of managing their claims utilisation for their employees. If, for example, an employee has high blood pressure, they will participate in an online test that provides insight on the employees’ overall health status, which is strictly confidential. Therefore, not even the employer would have access to such personal statistics on the employee.

We give the employer a company-wide profile and the employee is encouraged to work with his or her own practitioner and bring their health issues to a level that is better manageable and so in turn the company’s health utilisation goes down, so they pay less premium. This goes a far way in terms of looking out for our client because when your premium decreases, our earnings go down as well, but it does buy us value added and a lot of mileage with the client. We spend a lot of time reviewing clients’ utilisation on a quarterly basis, forecasts are made and also recommendations to improve outcome.

Innovation is essential for the long-term survival of any company. How does AIB incorporate innovation into its work and stay competitive?

Agreed. We have in place various innovations and these range from improving efficiency of the products we offer to our clients.  As a company, we try every year to have two innovative initiatives targeted at different areas of our business in order to keep up with current trends and changes in client needs/requirements.

With the logistics hub initiative and SEZs on the horizon as well as Highway 2000 underway, Jamaica is bound to welcome a rising number of foreign investors and business people. Given all of these companies would require some local cover, this could only benefit the company. What kind of experience does AIB have with foreign investors/business people?

Frequently, foreign investors already have their global policies in place, so for insurance we have to be careful that we manage our expectations in terms of growth opportunities from these ventures.  A Jamaican operation may be considered small so when we add on a Jamaican entity to an overseas multinational insurance, the insurance that the local market will charge versus adding on Jamaica in their global policies may not be competitive. We may lose if a multinational purchases a local company and takes the insurance overseas. We would gain if a multinational comes in and takes its insurances overseas but leaves the local classes.

There are some covers that you can’t take overseas like for the motor vehicles and the employer’s liability.

How do you engage potential new clients?

We have a New Business team that meets once a week to discuss what is happening, both locally and internationally. We analyse the insurance market activities and revert to our clients with our findings. We then take the time to explain to our clients what is happening in the market and review the pros and cons of a particular coverage.

In addition, product recall is something that we are very mindful of in Jamaica. So in terms of the company’s reputation and the awards given, product recall insurance would very much be of interest to both existing and new clients. In short, we assess the economic climate along with company activities, strategize our approach to the prospect and aim to be proactive.

AIB opened its Montego Bay office in 2010. Does the company have any plans to further expand locally or within the region?

We refer to the Montego Bay office as an outpost because it is not a full service branch, as claims are not processed or handled at that location. We have an account executive and an assistant who services the Montego Bay, Ocho Rios and Negril clients and provide support from the Kingston office. Allied’s intention is not to be in every parish or have another office across the island. What we do is grow the resource and operational capacity of the Kingston office and provide our sales team the flexibility of meeting with clients in various areas of the Island.

Corporate social responsibility (CSR) is an invaluable way for companies to give back to the communities in which they work as well as their staff. What CSR projects is AIB involved in?

We have various charities that we work with alongside the staff at GraceKennedy. Our main focus is on a Boys’ Home, which we have adopted for a number of years now. We engage them in various programs, have painted their rooms and built a library equipped with computers to encourage the increase of computer literacy in our young men. We staffed the library and members of Allied would often take the time to have reading sessions with them. We have engaged them in fun activities away from the home, at Hope Gardens, and even on the lawn of our office for a movie night. Sometimes we will host a games evening or give them the career world experience by letting them come to our office to spend the day with us.

In the Christmas season, our staff would volunteer for the GraceKennedy outreach program. For example, with senior citizens or at a children’s home. Our team takes much pride and pleasure in assisting those in need.

In addition to the company wide activities, the different departments in Allied have taken the initiative to choose a charity of their own to support. For example, our Broking Sales department has their own preschool to which they donate fans and sometimes provide breakfast etc. We sponsor numerous other charity events.

You have been with AIB since 1993. As Managing Director, what is your 5-year vision for the company?

I would like to see Allied having a regional presence. We have options that are currently in thought process and our plan is to have them executed in this area in the near future. In order to have exponential growth, we need to go regional and acquire new markets. As to how we go about that, it is still early days.

The readers of Harvard Business Review include the world’s most influential business and political leaders. What message would you like to send them about Jamaica and about AIB?

In terms of Jamaica, we are a set of people who are very innovative and can make the best out of a small situation, so take a chance on us. In regards to Allied, we welcome overseas investors. Allied has been the number one broker for over 15 years in Jamaica. That did not happen through chance or a wish, it has come through hard work, loyalty, professionalism and that is what we will maintain and will continue to offer.