The Insurance Council of Australia’s (ICA) announcement that it is working on a rebuild of “brand insurance” is very welcome.

CEO Rob Whelan told last week’s National Insurance Brokers Association (NIBA) Convention that communication during and after the event was one of the key lessons ICA has taken from the last disaster season, and he identified a number of areas where communication failures had occurred.

Mr Whelan says that while quick and effective communication with stakeholders including the community, media and government was “fundamental”, ICA was faced with “overwhelming demands for data” that it could not meet.

He says the flow of information from member companies to ICA was “erratic”, making it difficult for the organisation to keep stakeholders informed of developments. Greater co-ordination between member companies on key messages was required, with different messages being circulated by different companies.

Many delegates at the NIBA Convention panel session (where the issue was discussed) were polled about their views of the industry’s response to the catastrophes. Most responded that the industry had handled its response “as well as can be expected given the circumstances”. Those who felt the industry had done a poor job were in the significant minority.

But no matter how much we can now say the industry performed well, the public and the politicians don’t judge us on the number of claims (eventually) paid. ICA had no meaningful crisis communications strategies or programs in place and no people trained to deal with the sudden media and public interest – and it showed.

The crisis management approach is presumably in the process of being fixed. But changing the public’s overall perception of the insurance industry is a far greater challenge.

Steadfast Executive Chairman Robert Kelly told the convention audience that “the whole consumer advertising [around insurance] in this country is geared to price, not to advice”, and of course he is right.

The major direct insurance brands advertise personal lines products to the mass market using little more than catchy jingles and price promises. And then their corporate parents bemoan the lack of understanding consumers have of insurance products, how the insurance market works and the wider role of insurance.

Consumers don’t delineate between a direct and an advised industry; when they see those ads they see the insurance industry – and they see price.

Mr Whelan made reference to the mining industry’s campaign against the mining super-profits tax, and the way that industry was able to “change the community’s obscure notion of [mining] being just about digging holes in the ground, and made it relevant to everyday life”.

He says the insurance industry needs to make it clear to people how insurance underpins their lifestyle. They have had no tangible reminders of that fact since HIH collapsed more than 10 years ago. The subsequent implosion of the liability market led to the cancellation of everyday events such as school fetes and gymkhanas and brought home to the community the importance of a strong and secure insurance market.

There’s no doubt the Minerals Council of Australia (MCA), which was behind the mining tax campaign, emerged victorious over the Federal Government in that particular battle, and most Australians now have a fundamental sense of how mining underpins the economy.

“The insurance industry is exactly the same,” Mr Whelan told the NIBA Convention audience. “Without insurance the economy would grind to a halt.”

There was an element of déjà vu in his comments. From 1992 to 1996 the industry ran a TV and newspaper campaign promoting “insurance puts things back together again”.

While few would dispute the need for such a campaign now, the leading insurers’ commitment to the sort of campaign Mr Whelan is advocating is by no means as certain as it was in the 1990s. His own uncertainty about that commitment now may have been illustrated by his comment that followed his plea for the industry to get serious about the issue rather than just keep talking about it.

“We don’t want to blow our own trumpet,” he said, to which another panellist, Rebecca Wilson, GM Broking Operations (Southern) for Austbrokers Sydney, quickly responded: “Well actually, we do.”

As insuranceNEWS.com.au has noted before, the time for humility has long passed. Those major ICA member companies who push simplistic price messages through their direct brands need to consider their role in dumbing-down the industry’s image.

And to replicate the mining industry’s success, it needs to be understood just what was involved in achieving it. ICA’s four-year campaign in the 1990s cost about $6 million, a paltry amount even then. The advertising budget for the recent mining industry campaign was about $100 million. It used around 1300 TV commercials to achieve the necessary “cut-through”.

The lesson here is that it takes a strong will and substantial means to change perceptions, but it is possible. The insurance industry does have the deep pockets it would require, but the strength of its commitment remains in question.