Broker organisations add weight to intermediaries' voices

Joining a broker organisation can give brokers the edge over the direct insurance market by endorsing their credentials, as well as providing them with an excellent source of client referrals and better representation when it comes to collective bargaining on behalf of industry.

This is according to Edward Gibbens, Executive Head of Broker Distribution at Santam, who continues that "broker organisations add value by strengthening the independent brokers' voice”.

"The Independent Broker Council (IBC), for one, only considers membership applications from experienced brokers with proven industry standing who are authorised financial services providers or representatives of such providers."

Arnold van der Linde, Vice-president of the IBC, reports that membership of the IBC currently stands at around 3 000 brokerages, who employ around 9 000 people. The IBC is represented in 7 divisions and 24 branches throughout South Africa.

"Members are expected to honour the IBC Code of Ethics at all times, which means the organisation is able to insist on continuous training and that all members adhere to all requirements prescribed by FAIS," he says.

Ben Raseroka, President of Black Insurance Professionals of Southern Africa (BIPSA) says, "With consumerism on the rise and regulatory requirements becoming ever so strict, very few brokers can afford to operate without some formal membership to a professional industry body.

"These affiliations are even more critical to fairly new entrants who generally require strategic support from a body that is alive to the challenges they will face in the market place," Raseroka says.

"There are currently two organisations aimed at the black broker environment in SA namely, the Black Broker Forum (BBF) and the Association of Black Brokers. Above all, broker organisations, such as these, encourage the maintenance of minimum standards and ultimately contribute towards consumer confidence in the industry."

Gibbens continues that it is vital for brokers to play an active role in the increasingly complex insurance environment as pressure from direct insurers mounts.

"New products are continuously coming to market as client needs become more diverse. The need for independent and professional advice is growing. Broker organisations give the general public a place to find trusted financial advisors, and also provide a base of support for the broker, through which they can improve on and grow their business."

Ben Rossouw, MD of the South African Financial Services Intermediaries Association (SAFSIA), says with the financial services industry under greater government scrutiny than ever before, it is now more beneficial for intermediaries to be part of an industry organisation.

"Industry bodies provide representation for brokerages by collectively engaging and bargaining with authorities on their behalf, adding weight to the intermediary fraternities' voice, looking out for their needs and influencing government's decision-making where need be.

"Many potential clients expect their brokerages to be members of an industry organisation as it demonstrates their seriousness and reinforces their professionalism.

"As a founding member of the World Federation of Insurance Intermediaries (WFII) we are able to influence international developments and provide our members with information on the latest international developments in the intermediary arena. Our association with WFII also allows us to ensure that local practices are benchmarked against global best practice."

SAFSIA currently consists of around 250 member companies with around 10 000 individuals on the ground.