Compliance with “layers and layers” of regulation is forcing risk advisers to put off customer engagement, National Insurance Brokers Association CEO Richard Klipin warns.

“From a sector perspective, allocating resources to comply takes away from client-facing time,” he says in an industry report on challenges facing the industry next year.

“It takes away from addressing strategic opportunities, and from making the sector better.”

He adds: “While regulation has been designed to make the sector more resilient, safeguard consumers and build trust across the sector – and mostly it does that – when you have layers and layers, it ends up expensive for the sector to comply.”

For consumers, increased regulation has led to “more paperwork, more complexity and more cost, because you’ve got to layer all those costs somewhere.

“You can absorb some of them to a point, but in the end consumers end up paying and the costs go up.”

On a more upbeat note, Mr Klipin says the changing risk landscape gives brokers an edge over machines at claim time.

“For a lot of people … a claim event happens, [insurers] say, ‘Call 1800 or 1300,’ and suddenly you’re into a process where, for many people, computer says no, or computer says yes but ... no, or computer says yes but send me more documents and receipts, or we’re going to send out an assessor, and so on. Whereas if you have a broker, they would be the first person you call, and they will then advocate.” 

He says brokers are now “substantively” involved in claims.

“When something goes wrong, the first person you call is your broker ... This is where consumer versus brokered insurance really differs.

“Brokers across the board are spending much more time on that moment of greatest need – and it’s also one of the great times of opportunity.” 

The Insurance Outlook 2026 report by tech company Drova is based mostly on commentary from insurance leaders. It addresses CPS 230, climate risk, data and AI, and other priorities for brokers and insurers.

Click here to download a copy.