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UAA and MECON: Critical insights

2024 is shaping up to be a big year for Underwriting Agencies of Australia and MECON Insurance. Image: UAA.

Senior representatives from Underwriting Agencies of Australia share their insights and expectations for the year ahead, as well as the learnings from 2023, concerning the mobile plant and equipment insurance space.

For many across the infrastructure sector, 2023 was a year of transition and adaption.

Factors out of the sector’s hands continue to create escalation across the board, primarily driven by the supply constraints of parts, heightened transport costs from overseas, and a notable rise in labour costs.

The mobile plant and equipment, as well as the construction insurance industries are certainly not immune to these impacts. But solutions are already in the works.

Underwriting Agencies of Australia (UAA) is not shy to embrace challenges presented by fluctional escalation. 

With more than 35 years’ worth of intellectual property, along with an understanding of the current market, UAA is well placed to navigate associated challenges with the current economic climate.

While reflecting on the year just gone, Stan Alexandropoulos – UAA Group CEO says 2023 was a year of internal progress and change, establishing a platform for 2024.

One such highlight was UAA’s presence at the 2023 Crane Industry Council of Australia National Conference and Exhibition.

“CICA 2023 was, as always, a productive experience for UAA. UAA has been a major sponsor of the conference for well over 25 years and it continues to offer valuable opportunities to engage with clients and not only gain insights into the market but also share insurance market trends and information with our customers and the industry directly,” he says.

“The event also sparked new ideas and strategies, particularly in enhancing our service offerings and leveraging our market presence more effectively to benefit our customers going forward.”

Stan Alexandropoulos – UAA Group CEO. Image: UAA.
Stan Alexandropoulos – UAA Group CEO. Image: UAA.

For UAA, 2024 will be a year of broadening horizons, with improvements and internal developments to focus on ensuring that the company can provide the best for insurance claims services.

“We are focused on expanding our technological capabilities and work environments. This includes a major office refurbishments and the introduction of state-of-the-art IT platforms to streamline processes and improve data management, driving efficiencies across all business units,” he says. “This will encourage innovation, better management reporting and in turn greatly improve our service offering to our customers. 

“The UAA Group will also continue to explore growth opportunities in several global markets in Asia and North America in order to take advantage of over 35 years of intellectual property embedded in our business.”

This will include further growth to the partnership between UAA and MECON Insurance, a relationship that has grown exponentially since the two company’s merged in July 2022. 

“[This includes] the continued integration of UAA and MECON, focusing on unified branding and marketing strategies. The UAA and MECON partnership will deepen, focusing on leveraging each other’s strengths to enhance market presence. The continued sharing of best practices will be key areas of growth, further solidifying our position as market leaders,” Alexandropoulos says.

He adds that despite these internal changes, the needs and requirements of the sector remaining paramount. 

“Whenever a business undergoes transformative change, it runs the risk of becoming too inwardly focussed and neglecting the important fundamentals that drive it. This is something that isn’t lost on me and our management team, so we will continue to work on ways of improving our business but always with one eye on our customers and their needs,” Alexandropoulos says.


 

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Tackling challenges 

Marc Crossman – UAA Group Strategy and Distribution Manager, says the next 12 months will not be without its challenges, but UAA is well equipped to cater for the evolving needs of the sector.

“In 2024, one of the main challenges in the plant machinery insurance sector will be navigating the limited supply of new machinery and the consequent rise in the value of used machinery. It is critical that, when reviewing your insurances, insurers are accurately setting their insured amounts that are reflective of the market at that time,” he says.

“This will likely see their values increase but it will likely mitigate the risk of being under insured and financially exposed at the time of a loss.”

Legacy industry issues stemmed by the COVID-19 pandemic, as well as on-going economic pressures, continue to linger. This, combined with the growing pipeline of infrastructure projects, will place a greater strain supply, demand and delivery.

“With the surge in infrastructure projects across the country, there’s a growing concern about the availability of experienced operators. We are addressing this by advocating for and supporting training initiatives, ensuring that safety remains a priority in all operations,” Crossman says.

“UAA believe in proactively adapting to these changes, maintaining a balance between embracing innovation and ensuring the safety and well-being of our clients and their assets.”

Marc Crossman – UAA Group Strategy and Distribution Manager. Image: UAA.
Marc Crossman – UAA Group Strategy and Distribution Manager. Image: UAA.

He adds that the constant evolution of technology will also present challenges and opportunities for the insurance space.

“While AI can enhance operational efficiency and safety, its impact on the market is still being assessed. UAA is closely monitoring these developments to understand how AI integration affects risk profiles and insurance requirements,” Crossman says.

Balancing the emergence of this technology while also addressing traditional challenges is a summit that’s yet to be climbed by the sector, he says. One such aspect is the growing threat posed by cyber risk.

“As plant machinery becomes increasingly interconnected and reliant on digital technologies, the exposure to cyber threats grows. This trend necessitates a new dimension of risk management, focusing on cyber security for both the machinery and the data it generates,” he says.

“Cyber risk is not just about data breaches; it extends to the potential for operational disruptions, which can have significant financial and safety implications in the plant machinery sector.”

Crossman says UAA is working to ensure that the impact of supply chain issues, as well as skilled personnel shortages can be minimised for brokers and clients.

“In response to the supply chain issues and repair delays, we have strengthened our relationships with suppliers and repair networks. This enables us to expedite the repair process wherever possible, reducing downtime for our clients,” he says.

“Our team is also continuously monitoring supply chain developments to provide timely updates and solutions to our brokers and clients, ensuring they’re well-informed to make the best decisions.”

One way in which UAA is helping to address and cater for rising claims costs is the adaptation of the company’s risk assessment and pricing models, to ensure that they can reflect changes to the market.

Transparency has long been a staple of UAA’s service, which Crossman said will be important in ensuring that clients can be aware of any required price increases.

“Additionally, we’re enhancing our digital platforms to streamline both our underwriting and claims process, making it more efficient and user-friendly. Our dedicated support teams are always available to assist brokers and clients, offering personalised advice and solutions tailored to their specific needs,” Crossman says.

“UAA have always believed in a partnership approach, working closely with our clients and brokers to navigate these challenges together.”

Crossman says that despite these challenges, the team at UAA is still eager to embrace the opportunities that lay ahead. 

“2024 presents a unique opportunity for UAA to deepen our client relationships through advanced, sustainable, and customer-centric insurance solutions. We’re excited to navigate these new frontiers and continue providing exceptional service and support to our clients,” he says. 

This article was originally published in the February edition of our magazine. To read the magazine, click here.

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