Benefits of Delegated Authority Schemes

As with any professional agent, an insurance broker’s ability to provide a first class service is limited by the performance of the product they deliver to their clients.  There is however, an agreement between the broker and insurer that overcomes this constraint.  It is called Delegated Authority (DA) and it is handed by the insurer to the broker, effectively empowering the latter to act as both, thereby providing greater control over the whole process of insurance for its clients. Such authority can be given either in the form of ability to underwrite a risk and/or ability to handle claims up to an agreed level.

The key here is that there are numerous benefits to the client under a DA scheme. Your broker is your point of contact, so it follows that it is to your advantage when that broker handles all stages of the process, including underwriting and handling your claim. Advantages include convenience; speed of service when processing renewals or midterm adjustments, and in most cases immediate instruction to go on cover following a call to their broker. A broker should always have a good knowledge of their clients’ risk, so being empowered to make a judgment on behalf of the client is always preferable to leaving it up to an insurer who has never met them.

With increased power comes with increased responsibility and insurers do not hand out delegated authority to brokers lightly. DA schemes are frequently audited and scrutinised by the insurer to ensure they are being administered responsibly. It is a testament to Bruce Stevenson’s professionalism and quality of its business that we have 3 such schemes, in our Property Solutions and Private Client departments. As an independent broker we do of course provide policies from a number of other market leading insurers across the board without DA, but when such schemes meet our clients’ needs they offer real benefits to them and in turn give us an edge over our competitors.