Franck Baron, group deputy director of risk management and insurance at International SOS, and chairman of Parima
Brokers, and as a result insurers, are failing to properly support risk managers as they move into the employee benefit space and increasingly want to place such risks in their multinational insurance programmes, Franck Baron, chairman of Parima, told those gathered for a Commercial Risk conference.
While being careful to note that risk managers also have much room for improvement when it comes to managing and transferring employee benefit risks, Mr Baron called for more help from the insurance market to help his industry step up to the plate.
Mr Baron was speaking at our ‘Global Programmes Consistency and Certainty 2019’ conference in London – partnered by AIG, Allianz, AXA XL, Axco, Charles Taylor, Clyde & Co, Strategic Risk Solutions, Willis Towers Watson and Zurich.
At the event supported by Parima and Airmic, he told the audience that managing employee benefit risk provides his profession with a great opportunity to raise its profile and prove its worth.
Risk managers have a big opportunity to help human resource managers deal with risk financing aspects of their job, he said. Helping companies transfer these risks to multinational insurance programmes is also a very good way of getting the c-suite’s attention on, and commitment to, such solutions, he added at the event that attracted over 150 people from the world of risk and insurance.
However, Mr Baron said that brokers are not providing the help that risk and insurance managers need to deal with human resource and employee benefit risks.
“They are not helping because if you look at the way the main brokers are structured – Marsh and Mercer, Willis Towers Watson, Aon and Hewitt – they not yet organised in a way that can provide us with a consistent and connected support, mixing both human resource consultancy parts of the business to the broking insurance placement part,” said Mr Baron, who is also group deputy director of risk management and insurance at International SOS.
“It is difficult to get people to link their expertise and provide one solution,” he added.
Mr Baron said risk managers are often being forced to bring the two sides of these businesses together to get the information and support needed to understand the big picture and potential solutions.
He added that the lack of coordination from brokers in the increasingly critical area of people risk means insurers are falling short too.
“Insurers’ preferred distribution channel is brokers. So if the brokers are not helping, insurers are not helping, because they are using brokers to provide their solutions,” he said.
Mr Baron warned that many multinational employee benefit insurance programmes simply aren’t working the way they should. He explained that the majority of his company’s employee benefit and medical programmes around the world are fully reinsured within its captive. “But we are struggling to get brokers and insurers to help coordinate all the different markets and jurisdictions we are integrating into our programmes,” added Mr Baron, before asking the insurance industry for more support.
“I am not here to bash brokers and insurers. As risk managers, we have our own challenges where we need to improve. But my message to you is: please help us to do what we are supposed to do so we can all benefit,” he said.
Adding: “If we are not supported by the insurance industry, we have problems. If we are supported by you, it will be less challenging. Keep in mind that risk managers are seen internally as being as good or as bad as the way the brokers and insurers are working. So if my insurers and broker are not working well, I am seen as being part of an inefficient food chain.”
Also at the event, strong>Marsh’s Praveen Sharma called on the London insurance market to come together and agree on interpretations of insurance regulations around the world to drive consistency in global programmes.