Chubb President and CEO Evan Greenberg is slamming the behavior of some brokers as “abusive,” but a major industry group asserts that he wasn’t referring to anyone in the U.S. market.
The remarks at issue are part of Greenberg’s letter to shareholders, included as part of Chubb’s 2016 annual report. Here’s the relevant passage in its entirety, stemming from his thoughts on the soft market.
“… Another sign of a soft insurance market is the abusive behavior on the part of some brokers who enrich themselves at the expense of both their customers and underwriters. Cloaked in the mantra of ‘customer best interest’ or “treating customers fairly,” they seek the cheapest price and broadest coverage at commission terms that by any measure are excessive.
“Forcing underwriters to succumb to the lowest common denominator is hardly in the customer’s, or industry’s, best interest. These predatory behaviors, which have shown up around the world, and in London in particular, are simply unsustainable from an underwriting perspective and will come back to haunt these brokers: there will be customer and regulator backlash, or worse. Remember, distribution can be disintermediated.”
A number of media outlets picked up this particular passage, which turned a number of industry heads.
A spokesperson from the Independent Insurance Agents and Brokers of America said that the remarks did not refer to brokers and agents who deal with Chubb in the U.S., and that the company had assured the association as much.
“In a conversation between IIABA’s CEO, Bob Rusbuldt and Evan Greenberg, CEO of Chubb, about his recent comments in the press, Mr. Greenberg assured IIABA that his comments were in regards to the London wholesale market and not about Chubb agents or brokers in the United States,” the IIABA’s Margarita Tapia told Carrier Management via email. “Mr. Greenberg reassured IIABA that there are no changes whatsoever contemplated for Chubb agents in the United States.”