Rising to the challenge in insurance repair

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Ambrose Construct Group is presenting the industry with choice. Property repair and restoration is on the verge of a paradigm change as the company forges ahead

HENRY FORD famously said that customers could have his Model T automobile in any colour so long as it was black. Those needing insurance building and restoration services in Australia might sometimes feel like a Model T customer when it comes to options, but not any more. The merger of Construct Services and Ambrose Building just over a year ago to form Ambrose Construct Group (ACG) has resulted in a major insurance building and restoration company that has national coverage, boosting competition in the sector. “We’re a disrupter that’s coming in [through the merger of] two very experienced insurance builders who have come together and learned the lessons of the industry over the last 40 years,” says Anthony McLean, national operations manager at ACG. The development went somewhat unnoticed at first but is now causing heads to turn in a market long dominated by a single large player. “There's a lot of buzz because people are saying, ‘OK, this is actually going to have 30 offices across the country with 500-odd staff. This is a bit bigger than what we expected’,” McLean says.

The Ambrose Construct Group is an industry-leading national provider of property repair and restoration services to the Australian general insurance market. With teams specialising in make-safe, residential, strata, commercial, heritage, catastrophe event and major and complex projects, it operates from 30 locations in all metropolitan, regional and rural areas across the country with a combined workforce of 550 people. The merger of Ambrose Building and Construct Services in November 2022 to become Ambrose Construct Group enabled both businesses to join forces, delivering superior customer-centric claim outcomes to insurers, underwriting agencies, brokers, TPAs and their insured customers.

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All about Ambrose Construct Group

Formed in 2022

“What brokers will now experience is that there is this viable alternative: there is a national challenger that’s got [insurance repair] coverage in metro, in regional and in rural areas”

Darren Trott, Ambrose Construct Group

There are a number of reasons for the excitement. ACG has strong relations with key insurers such as Allianz, Hollard, QBE and Suncorp, and these relations have expanded further on the back of the merger and grown to include the likes of IAG. Added to that, there are expectations that more competition will help raise service standards. “One of the bits of feedback that we get about competitors is an inconsistency of service,” says Darren Trott, general manager of business development at ACG. This inconsistency can be geographic in that certain parts of the country are excluded from service; or can be related to speed of service at certain times of day or calendar year. “What brokers will now experience is that there is this viable alternative: there is a national challenger that’s got the

coverage in metro, in regional and in rural areas. As our CEO says, we won’t turn down a job.” Trott gives the example of an emergency make-safe service for a factory fire at 10 p.m. on a Friday night. ACG will respond to an out-of-hours claim with a locally based specialist who can be on site within an hour in most cases. “When a factory owner calls and says, ‘I've got the fire brigade here; what do we do next?’, what happens in that next 24 hours could mean the difference between that business surviving and not surviving,” he says. Stakeholders have had to put up with spotty service in terms of insurance repair because there was no real alternative until now. “We’ve got responsiveness, consistency and a genuine care for people, not just claims,” says Trott. “Other things that we do differently are in terms of our relationships with the insurance industry. We’ve got deep relationships with insurers, loss adjusters, underwriting agencies, broking groups, because we’ve invested in those relationships.”

One area in which ACG is changing the paradigm is its new restoration service. There is a longstanding issue that impacts both economic and environmental imperatives for the insurance industry around the disposal of goods that have been partly damaged in an insurance event but may in fact be salvageable. A fire might only affect one room in a house, for example, but water damage to goods in other rooms often means that items get thrown out simply because it’s easier to buy new than restore. “Typically, what happens is that all of those contents get turfed, and the insurer makes a cash settlement to the insured

customer [for new content] – and that’s expensive for the insurer,” says Trott. ACG opened a super-centre in Dandenong, Victoria, six months ago that takes care of the problem not only of where to store goods while they are being restored but also where to keep them while the insured’s property is being rebuilt. “[It’s] got so much storage that we can pick up 10 houses’ worth of damaged goods, have them there on pallets [after restoration], then return the goods to the property owner or business owner [later].” ACG has invested in the latest restoration technology, including a $120,000 washing machine that gets rid of smoke contamination, but the reality is that many items simply need a thorough clean. The default setting for contents involved in an insurance event is to dispose of them, and this is thought to result in 50–75% of perfectly restorable items going to landfill. Another aspect is the ability to save sentimental items. This is often cited as a key trauma for insureds, but it’s also a major pain point for insurers due to the fact that they nearly always have relatively arbitrary values attached to them. “For the insurers, there’s a lot of items that come into dispute that don’t have an actual, real dollar value in today’s society because you can’t replace the item,” McLean explains. “But when we’ve got the ability and the expertise to restore those items, that replacement discussion goes away.”

“The savings that are produced for the insurer are considerable – for every dollar it’s estimated that they might need to complete the repair, they put $1.50 in the bank”

Anthony McLean, Ambrose Construct Group

Rather than paying $5,000 for an old wardrobe that belonged to the insured’s grandfather, the item can be restored for much less. “The savings that are produced for the insurer are considerable – for every dollar it’s estimated that they might need to complete the repair, they put $1.50 in the bank that is locked away until the claim is finalised,” McLean says. The innovation also has strong ESG implications, and this is an area that more and more insurers have future ambitions to develop and are cognisant of when it comes to dealing with processes such as insurance repair.

“We want to be known as a company that delivers … that’ll go the extra mile, whether it’s metropolitan or whether it’s regional, whether it’s rural, and do a good job consistently,” Trott says. Staying on top of the game requires recognising that the game itself is constantly evolving – another state of play that is easier for a challenger company to cope with. “Being the best is being adaptable and understanding your industry,” McLean says. There is also unlikely to be any shortage of repair work with climate change related catastrophes increasing in number and severity. “It’s an exciting time in the insurance industry,” says Trott. “When you look at what's happening in the rest of the insurance repair industry, we’re well placed to continue our growth.”

Construction workers installing a metal frame on the ceiling. Property repair insurance.

More competition leads to better insurance repair service

Solving the restoration challenge

Published 04 Dec 2023

Locations in 30 centres around Australia

>550 staff

>100 trading years in insurance repair between the component firms

Extensive national coverage

On standby 24/7

Annual cost of extreme weather events in Australia

Insured losses

Estimated annualised residential building-related costs from cyclones, bushfires and floods

Uninsured losses

Underinsured losses

Mental health impacts

Loss of housing

Employment impacts

$400m

$800m

$1,200m

$1,600m

TOTAL

487

2,002

1,475

3,964

Bushfire

Cyclone

Flood

Total

Source: Future Proofing Australia's Resilience, Insurance Council of Australia (October 2023)

“We have what we would call an industry-leading approach to ESG [due to this service],” Trott says. The initiative is still too new to collate any solid data on actual costs saved, but the appeal to brokers and insurers has been intuitive and immediate. Demand is so good that a second warehouse will be opened in Brisbane in December.

Looking ahead for insurance repair

In many ways, Construct Services and Ambrose Building were ideally suited for a merger. Construct catered to a very wide range of claims types, including residential, strata, commercial and major loss. Ambrose, in contrast, focused mainly on high-volume residential claims related to water and catastrophic weather events. As a result, Ambrose had deep relationships with insurers and other stakeholders in its area of specialty, while Construct had a broader range of relationships. The merged entity has been able to take Construct’s wider focus and bring an Ambrose-type depth to relationships – a case of the sum of the parts being greater than the whole. “What we’ve done is taken the best parts of both businesses,” says Trott. “For our clients, we don’t want them to experience any difference … we want them to continue to get the great service that they’ve always had, but we can offer more things more consistently in more locations to more of the insurance industry than we’ve ever been able to do in the past.” The merged entity has also been able to cherry-pick and reshape to a degree the best aspects of each component company, including a tech system that automates 130,000 tasks a day, or bespoke apps such as the Tradies App, the Estimators App and RepairHub, where customers can track their repairs. ACG has also been able to pause, step back from the market and try to shape its systems to unmet needs – a vantage point that often accrues to challenger companies in areas long dominated by an incumbent. “When you look across the group, collectively we’ve got 100 trading years of experience in insurance repairs,” says McLean. “There are not too many organisations that can say that, but I think we back that up with learning the lessons of our past and [asking] ‘could we have made that different?’ That’s one of the big things for us [about the merger].” The merger has created an entity with a presence in a large number of locations around Australia, and these locally based staff promote and use local contacts when attending to a claim. “The supervisors that live regionally live and work in the community ... they will be 15 minutes away [when a call comes in, which means] we’re going to have someone on site,” McLean says. Local people not only know the best ways to procure material, or about common choke points that may trip up an outsider, but they also endear themselves to the community by subcontracting to local people. “That’s been one of those differentiators – we’ve got this real local footprint where we employ locally, and when we try to keep it local, I think a lot of brokers and other people resonate with that,” he says.

A merger match made in heaven

After spending a year building up capacity, Trott and McLean see a lot to look forward to in terms of where ACG's momentum is heading. Clearly, the restoration program is a forward-looking project with implications for reducing waste and quantifying existing inefficiencies for the entire industry once data becomes available. The synergy between the component companies that comprise ACG and their ability to stand on each other’s shoulders to expand the network’s size and depth will also supercharge change in the insurance repair sector.

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