Broker buying frenzy continues by jennyyingdi



                                                                               As Aviva looks to                                              Axa launches tie-
                                                                               drop the Norwich                                               up to boost energy
                                                                               Union name, Mark                                               compliance. Page 3
                                                                               Winslow looks at
                                                                               what insurance brands                                         Postscript — all the
                                                                               mean for brokers.                                             fun from the opening
                                                                               Page 7                                                        evening     Page 20
 DAILY                                                                                                                                   Thursday 1 May 2008

                IN ASSOCIATION WITH
                                                                      Broker buying
                                                                      frenzy continues
                                                                      BY LYNN ROUSE                     commercial motor — and              management adviser and
                                                                      B RO K E R      acquisitions      MRS Financial.                      will fall under the remit
                                                                      continued apace this week            Earlier in the week, Equity      of Patrick Snowball as
                                                                      with Bryan and Knott,             Insurance Group announced           chair man of Towergate
                                                                      Kennet Insurance Brokers          its 35th buy in 24 months by        Financial Services, who
                                                                      and MacDonald Reid Scott          purchasing West Midlands            commented: “MRSFS is a
                                                                      all being snapped up by           personal lines and commercial       great addition and we have
                                                                      aggressive consolidators.         broking operation Bryan and         exciting plans to expand
                                                                        Higos Insurance Solutions       Knott for an undisclosed            our presence in Scotland
                                                                      yesterday reve aled its           sum, netting five additional         through the acquisition of
                                                                      intention to become a top 50      branches to take its total          well-run IFA businesses as
                                                                      broker by 2010 after swooping     network to 90 outlets.              part of our new model for
                                                                      for Kennet — a deal which            All MRS staff have               this market.”
                                                                      brings it three new branches      transferred to Towergate              Higos said its acquisition
                                                                      in Wiltshire and four senior      under its deal. The financial       strategy is based on the
                                                                      managers. This follows            business is an employee             “careful selection of profitable
Must be talking to an angel: the BIBA conference has returned to      the successful purchase of        benefits and wealth                 local brokers who have strong
Glasgow, home of chief executive Eric Galbraith, for the first time    Homesure, Mike Deverell, Lo-
since 2004 for its 30th annual conference. This year’s event looks    Cost and Colin Foster over the    RECENT CONSOLIDATION IN THE SCOTTISH BROKER MARKET
at ‘influencing tomorrow’ and ‘giving good advice’. The conference
sessions today start with a new debate feature and closes tomorrow
                                                                      last year, taking Higos to nine   March 2002     Smart and Cook — now part of Venture Preference
with a session by Sir Bob Geldof. BIBA said it could not think of a   high street insurance shops.
                                                                                                                       -— acquires Lanarkshire broker Lewis Wotherspoon.
person who had done more to influence tomorrow.                          On the same day Towergate
                                                                      confirmed its deal to acquire      October 2006 Oval acquires Service Miller in Glasgow
                                                                      Scottish group MacDonald
HBOS to keep insurance arm                                            Reid Scott, shoring up its
                                                                      presence north of the border
                                                                                                        April 2007     Towergate acquires JW Group with six offices in
                                                                                                                       Edinburgh, Glasgow, Kircaldy, Berwick, Jedburgh and
HBOS has said it has no plans       to underpin its competitive       (Post, 1 May 2008, p3).
to follow the Royal Bank of         position.                         The group comprises two                          Oval acquires Cuthbert Service and Jackman in Glasgow
Scotland’s lead by selling its         Andy Hornby, group chief       companies MRS Insurance           October 2007 Giles acquires Falkirk-based broker Crosbie and Jack,
insurance arm.                      executive, said: “The actions     Brokers — which controls                       which also has offices in Stirling, Glasgow and Aberdeen.
   The news comes after the         we have announced achieve         premiums in excess of £9m
bank issued a rights issue          a step change in our capital      from property, liability and      January 2008 Towergate acquires McAcra Associates in Aberdeen.
on Tuesday to raise £4bn net        strength and our target ratios.
of expenses to strengthen its       This allows us to consolidate
                                                                                                                                            Norwich City: players will proudly
capital base.                       our competitive position in                                                                             wear the Aviva brand on their
   An HBOS spokesman                our core markets.                                                                                       chests for the next three years,
revealed that it has not               “We are planning a more                                                                              kicking off in the 2008-2009
considered selling its              challenging environment ahead                                                                           season, after the insurer took the
household and payment               and the proceeds of the rights                                                                          decision to drop the 200-year-old
protection business or its          issue should ensure we benefit                                                                           Norwich Union insignia. Following
                                                                                                                                            the rebrand — which is expected
stake in motor insurer Esure.       from strong ratios even if the                                                                          to take six to nine months in the
   He said: “HBOS already           macro-economic environment                                                                              UK — the firm will continue to
has a strong balance sheet,         deteriorates further.                                                                                   be headquartered in Norwich,
and the rights issue will              “In the long-term we remain                                                                          where it was founded. NU chief
strengthen it further. All our      optimistic and the group will                                                                           executive Igal Mayer said: “This is
main businesses complement          be well positioned to benefit                                                                            not simply about a name change,
                                                                                                                                            it is about bringing 57 000
each other, and there is no         over time from a number of                                                                              employees under one brand with
requirement or desire to sell       selective growth opportunities                                                                          one global identity and vision.”
any of them.”                       across our businesses where
   The bank’s board is also         there will be scope to earn
establishing a new target Tier      good returns.                                                  OFFICIAL MEDIA PARTNERS
1 ratio of between 8% and 9%           “We are focused on
and a new target core Tier 1        achieving returns on equity
ratio of between 6% and 7%.         in the mid-teens and are well
   It says an enhanced capital      placed to deliver long-term
position will enable the group      sustainable growth.”

 Roundtable: See debate inside on flood lessons learnt — nine months after the crisis first unfolded.
2          NEWS

                                    Service levels not up to

AIG UK extends Lifeline
AIG UK is targeting regional
brokers with the latest version
of its Lifeline Plus group
personal accident product. Tom
Doherty, AIG UK executive
                                    scratch, bemoan brokers
                                    BY MARTIN FRIEL                            Around 14% agreed Fortis              to get insurers to do things.”         that Axa polled only 3%
director, said: “This product       INSURER service levels are still        provided the best service,               Yet another remarked he was            of the votes, but what was
enhancement is the latest           not meeting broker expectations,        closely followed by Norwich              “pretty unimpressed with               surprising was broker-only
example of our commitment           according to the latest Insurance       Union on 10%. However,                   them all at present”.                  insurer NIG’s fall from grace.
to the regional market, where       Age broker survey.                      nearly 14% felt that none of               Broker dissatisfaction with          In last year’s survey the Royal
we are focusing on creating a         Although respondents                  the 18 insurers listed offered           service is nothing new, but            Bank of Scotland Insurance-
tailored set of products that are   overwhelmingly agreed their             their broker partners a high             insurers — particularly those          owned company came top
highly relevant to broker needs.”   preferred method of obtaining           quality service.                         that claim to live and die by          — but only managed to poll
                                    cover was through an insurer               One respondent felt insurers          their service levels — will            a meagre 5% this year.
QBE launches PI product             (89%) — as opposed to                   were “all particularly poor”             be concerned that only two                More than 80% of those
Insurer QBE has launched            an underwriting agency,                 with no “clear quality insurer           companies managed to garner            responding to the survey were
PI Techplus, a revamped             managing agent or wholesaler            in respect of service”, while            more than 10% of the votes.            BIBA members.
professional indemnity product      — a significant proportion of            another said: “Nobody seems                In light of recent press             A full round-up of the results
aimed at IT consultants. A          brokers felt that service levels        to provide a good service these          coverage regarding poor                can be found in the May edition
spokeswoman for QBE said            were still not up to scratch.           days. It is a constant struggle          service it was no surprise             of Insurance Age.
features include cover for
breach of contract; computer
virus transmission; breach of
confidence and privacy; bodily
                                    Resurgence in PL brokers BIBA upgrades search system
injury and property damage          PERSONAL lines brokers are              insurance is still regarded              B I BA        has                                         BIBA
arising from technology; and        set for a comeback, according           as an intermediated form of              launched a new                                            website:
the insured’s own irrecoverable     to research by data analyst             insurance, competition in the            website, including                                        allows
fees. QBE is represented            Defaqto. The company said               form of direct writers is now            its ‘find a broker’                                        to search for
at BIBA by underwriters             this week it believes there has         here and likely to intensify.            section, to allow                                         local brokers.
from each of its casualty, PI,      been an acceleration in the                “Brokers are continuing               consumers and
property and motor teams.           number of brokers with online           to provide their clients with            businesses
                                    capabilities to provide car             advice essential to protect              to search for
D&O benefits added                   insurance quotations appearing          their businesses and they can            brokers by type
Lockton’s affinity division has      on aggregator sites.                    add value to the purchase of             of insurance and
teamed up with Ace to provide          It added that while direct           what, for some at least, is still        location.
an updated professional             writers and aggregators make            a complex area.”                            Additional
indemnity insurance cover for       inroads in the commercial                                                        functionality includes
BIBA members. Along with            small to medium-sized                                                            an event calendar for
revised wording, the cover now      enterprise market, the broker                                                    members, a site map
includes two new benefits for        is still king in the medium to                                                   and an improved search
directors’ and officers’ and         larger sector.                                                                   feature for members to locate          benefit from new business
exposures emanating from               Mike Powell, consultant for                                                   technical and regulatory               leads generated by the online
internet trading. ‘Elite IV         general insurance at Defaqto,                                                    information.                           find a broker service. This
directors and officers’ provides     commented: “The broker is still                                                      A spokesman for BIBA               information is also updated
cover for legal representation      a major player in the insurance                                                  said the portal is self-service,       on our database, which is
expenses, defence costs             industry, with resurgence                                                        allowing members to update             used by the consumer call
and damages arising from            in the car insurance market                                                      their own details and control          centre to make customer
a wrongful act while acting         through aggregators becoming                                                     the referrals they receive. He         referrals; this telephone
as a director or officer; and        more prominent.                                                                  added: “The more brokers               helpline receives more than
‘dataguard plus’ covers first           “Although commercial                 Powell: brokers still major players.     use it, the more they will             50 000 calls each year.”
and third party exposures
emanating from internet and          This year’s stands: a snapshot
electronic trading.
                                    Claims management company Plantec Holdings is hosting a Scalextric track fastest lap time competition
                                                                                                                                                            Legal deal
ARC allows self-service             on its stand throughout the conference. Scottish legend triple British Superbike Champion and motorcycle GP             BROKER Lockton Affinity
CGI has launched a web-             ace Niall Mackenzie will also be on hand. The fastest lap time will win two VIP tickets for a first-class                has teamed up with Bristol-
based self-service kiosk            hospitality package at the Formula One testing for the British Grand Prix at Silverstone, with VIP tickets              based legal expenses specialist
for brokers to sign-up to           for World Superbikes and British Superbikes for the two runners-up. Go to Stand E18.                                    Arag to broaden its product
its Account Reconciliation                                                                                                                                  range to its solicitor network.
Centre themselves. A pilot for      First time exhibitor WR Berkley Insurance (Europe) will play host to an Eagle Owl on its stand, D14,                       Lockton will market Arag’s
the project was started last        as also appears on its corporate logo. WR Berkley writes professional indemnity, directors’ and officers’, medical       product range, underwritten
June with 20 brokers using          malpractice, engineering and construction, and accident and health.                                                     by Brit Insurance, to both
the system; this number has         Ratings agency AM Best is offering brokers discounted Best’s Insurance Reports on its stand, and is giving              new and existing clients
now increased to 248. CGI           away a free copy of its Pocket Key Rating Guide, a handy reference containing current year ratings and                  — confident it will have a
developed ARC in 2007, in           financial results for insurers in the UK.                                                                                significant impact on the
partnership with Allianz and                                                                                                                                after-the-event market.
Norwich Union. The system           Provident Insurance is giving away an Apple I-phone on its stand, L7, in a business card draw.                             Arag’s business development
claims to ease the burden of        CFC Underwriting is giving away a Ferrari F430 worth £125 000 to any delegate that can guess the six digit              and marketing director Paul
account reconciliation across       combination to a special vault on its stand, C15.                                                                       Hurley said: “Lockton has an
the industry by allowing                                                                                                                                    established network of solicitors
brokers and insurers to move        For the sixth year, Groupama Insurances will be providing the ‘Groupama Conference Business Centre                      so it is a natural development to
away from the manual, paper-        and Internet’. The facility offers online PCs, PC printing, a relaxation zone and a new refreshment bar. In addition,   extend its product offering with
based process.                      it is offering ‘mini massages’ and a complimentary manicure service.                                                    ATE insurance.”
                                                                                                                                                          NEWS                  3

Axa/Lexicon launch EP
                                                                                                                                                 NEWS IN BRIEF

                                                                                                                                                 Tully leaves VP

assessment network
                                                                                                                                                 Venture Preference has
                                                                                                                                                 confirmed the departure of
                                                                                                                                                 Layton Blackham group
                                                                                                                                                 personal lines manager Chris
                                                                                                                                                 Tully amid a “re-jigging of
                                                                       ENVIRONMENTAL COST OF SMES — WHAT BROKERS NEED TO KNOW                    various parts of the business”.
AXA has teamed up with the                                                                                                                       Stuart Reid, chief executive
BRE and Lexicon Energy to                                              Small to medium-sized enterprises generate approximately 110              of VP, added: “Things didn’t
provide an extensive network                                           million tonnes of carbon emissions each year, according to new            work out quite as he had hoped.
of fully accredited assessors                                          calculations by Axa. In an effort to help small businesses reduce         Joining 14 different businesses
for the provision of energy                                            their environmental impact, the insurer has launched a free               is going to be difficult and there
certificate services.                                                   ‘carbon footprint calculator’ to help firms assess and reduce              will be some changes.”
  The announcement follows                                             their environmental impact. The calculator, which is provided in
                                                                       conjunction with The Carbon Neutral Company, takes information
the introduction of the European                                                                                                                 Directors set up adjuster
                                                                       about an SME’s energy usage, waste and travel, and calculates
Union’s Energy Performance of                                                                                                                    Two senior directors have left
                                                                       a report on the company’s Co2 emissions. The calculator will be
Buildings Directive, which has                                         available for brokers to see at Axa’s stand D2.                           Questgates to set up new loss
made it a legal requirement for                                                                                                                  adjusting firm Core Insurance
commercial buildings to have                                           registering        assessors         buildings will no doubt have         Services. David Miles and Alan
energy performance certificates.                                        to produce EPCs in the               an impact on property values         Hines have retained the offices
The first phase comes into force                                        commercial buildings sector,         over time. Building owners           and personnel at Questgate’s
on 6 April in the UK.               Barnett: owners face fines.         and scheme members will be           need the assurance that              Oxted base and, despite only
  Doug Barnett, head of                                                regularly audited and required       the EPCs they commission             launching today, already have
customer risk management at         able to sell or lease and can be   to operate to best practice          are prepared to the highest          a liability contract with Assett
Axa, said: “This directive is an    fined if they try to do so.”        professional standards.              standards and that the               Management and have been
important piece of legislation        BRE’s energy assessor              Andy Butterfield, BRE              recommendations made for             placed on its panel to deal with
that should not be taken lightly.   accreditation scheme is one        accreditation        scheme          improving their building’s           new employers’ liability and
Without a certificate, property      of only three government           manager, commented: “The             energy performance can be            public liability claims from a new
owners and agents will not be       approved schemes currently         energy performance rating of         relied upon.”                        scheme underwritten by Chaucer.

                                                                                                            Trust trek: nine teams completed
                                                                                                                                                 CL appoints manager
                                                                                                            the Insurance Leadership                             Cunningham
                                                                                                            Group Namibia Challenge last                         Lindsey
                                                                                                            week, with AIG coming in first,                       Valuation
                                                                                                            Watson Wyatt second, and SSP                         Services, which
                                                                                                            Holdings taking the last podium                      provides BIBA’s
                                                                                                            position. In 40 degree heat,
                                                                                                            all participants cycled, biked
                                                                                                            and trekked more than 150km          scheme, has appointed Bill
                                                                                                            through the desert — with a          Haywood-Smith (pictured) as
                                                                                                            70m abseil during one afternoon.     manager. Mr Haywood-Smith
                                                                                                            So far the challenge has raised in   has been with Cunningham
                                                                                                            excess of £70 000 for The Prince’s   Lindsey for more than 12 years.
                                                                                                            Trust. Broker Liz Foster of Ingram
                                                                                                            Hawkins and Nock discusses
                                                                                                            why she is involved in the ILG in    Online products relaunch
                                                                                                            tomorrow’s BIBA Daily.               Defaqto will be showcasing
                                                                                                                                                 its recently revamped Star
                                                                                                                                                 Ratings, Compare and Aequos
North-west advisers tie-up Hagerty in                                                                                                            Online products on stand L17.
                                                                                                                                                 Star Ratings helps consumers
to boost broker value      broker move                                                                                                           distinguish between various
                                                                                                                                                 levels of standard policies
TWO North-west professional           Nigel Wallis, a partner with     CLASSIC and collector car                                                 in the marketplace; Compare
firms have joined forces to         O’Connors, said: “Insurance        insurance specialist Hagerty                                              enables users to measure the
offer a one-stop service to         brokers are facing a period        International has announced                                               quality of policy features
insurance brokers.                  of massive change with             plans to expand its role as an                                            against each other; and Aequos
   Legal adviser O’Connors          consolidation gaining pace         underwriting agency to the UK                                             Online holds information
and corporate finance adviser        and insurers and IT providers      broker market.                                                            on more than 4000 general
Ford Campbell Corporate             moving in on brokers’                 Angus Forsyth, managing                                                insurance products from over
Finance have begun work on          traditional territory.             director of Hagerty International,   Forsyth: open for brokers.           500 providers.
an integrated initiative to help      “There is a relatively limited   said: “When we launched our
broking firms achieve value          window of opportunity,             company we envisaged some            our partners can work with           D&O manslaughter cover
for their business during the       perhaps 18 months, for broking     business coming from the broker      us safe in the knowledge their       Novae Insurance has launched
current trend of significant        firms to take advantage of the      community, but the response          client portfolio will not be         a new directors’ and officers’
consolidation within the            market dynamics and strike         has been overwhelming. This          threatened.”                         liability policy to coincide
insurance market.                   the best deals.                    has encouraged us to design and         The firm, which currently          with legal changes relating to
   Major consolidators in the         “Volatility within the market    implement a simple, streamlined      underwrites Allianz’s classic        workplace deaths. The policy
sector include Towergate,           presents some realisable and       system to enable our affiliates       car scheme, said brokers can         provides defence costs for cases
Jelf, Oval and Aon, who have        substantial opportunities.         to use our services and earn         expect levels of commission          of corporate manslaughter. Jon
been involved in a number of          “Fo rd Campbell and              commission while concentrating       ranging from 7% to 12.5%,            Morgan, its regional unit head
acquisitions during the past        O’Connors have a proven            on their core business.              dependent on premium                 of financial lines, said: “Many
year. Insurers have also been       track record of advising              “We specialise in classic         income volumes as well as full       believe limited liability status
active in buying brokerages to      on      insurance-related          car insurance and do not offer       underwriting, marketing and          will protect them from being
secure their route to market.       transactions.”                     a range of personal lines, so        technical support.                   sued. It won’t.”

                                                                                                                                                           1 MAY 2008 BIBA DAILY
4         NEWS

Arista opens online doors
COMMERCIAL               lines                trading platform will now                                                                 The products currently            brokers have really embraced
underwriter Arista has opened                 provide instant access to                                                               available online are trades         online trading with us since
its online trading platform to                Arista’s package products                                                               and professionals — which           we launched in February and
the entire UK independent                     for the whole independent                                                               provides quotes for 300             have enjoyed the significant
broking market following a                    broking community.                                                                      trades and includes cover           benefits it provides.”
successful trial, subject to                     The platform is designed to                                                          for temporary employees                Arista is a commercial
acceptance criteria.                          give brokers access to instant                                                          and bona fide subcontractors         insurance provider specialising
   Arista currently works with                package quotes with the                                                                 — and property owners.              in property, liability and motor
nearly 200 registered brokers,                ability to review and amend                                                             Arista’s other package              classes of business. It was
which can trade both online                   if required.                                                                            products are due to go live         launched in 2006 by Mr Earle
for package products and                         In addition, a statement                                                             online shortly.                     and deputy chief executive
access the complete product                   of facts for all contracts is                                                             Commenting on the roll-out,       Lyn Carslake.
range via Arista’s regional                   emailed to brokers instantly                                                            chief executive officer Charles         Brokers wanting to trade
office and home-based                         and policy documents are                                                                Earle, said: “Arista’s approach     online with Arista can apply
underwriter network.                          issued immediately via email                                                            is all about saving brokers         for an agency at www.arista-
   The roll-out of the online                 when the quote is accepted.                          Earle: brokers embracing online.   time and money. Our existing

                                                                                                                                      WIN A WINEHOUSE
                                                                                                                                      Bexhill-based Bureau Insurance Services,
                                                                                                                                      which insures people with criminal

                talk to the
                                                                                                                                      records, is giving away an original

                                                                                                                                      painting of Amy Winehouse. The insurer
                                                                                                                                      commissioned the work to represent a
                                                                                                                                      second chance after becoming involved
                                                                                                                                      with prison arts charity the Koestler Trust.
                                                                                                                                      The artist is ex-offender Dean Stalham,
                                                                                                                                      winner of two Koestler awards.
                                                                                                                                         Chris Jordan, managing director of
                                                                                                                                      BIS, said: “We cover property that has
                                                                                                                                      been flooded or suffered subsidence
                                                                                                                                      and people with criminal records. We
                                                                                                                                      insure people and property that can’t
                                                                                                                                      get insured.”
                                                                                                                                         The business card raffle is on stand
                                                                                                                                      L27. Graeme Trudgill, BIBA’s manager
                                                                                                                                      of technical services, will draw the raffle at about midday tomorrow.

                                                                                                                                      No more penalties with
                                                                                                                                      DFI new claims product
                                                                                                                                      ONLINE auction-based                claims and associated vehicle
                                                                                                                                      insu rance service fo r             repairs have traditionally
                                                                                                                                      commercial fleet Direct Fleet        made this type of commercial
                                                                                                                                      Insurance has added a free          insurance complicated and
                                                                                                                                      claim and accident handling         costly to manage — but DFI is
                                                                                                                                      product to its site.                set to change that.”
                                                                                                                                         The new service means               DFI will be on stand M14.
                                                                                                                                      all brokers using DFI will
                                                                                                                                      no longer incur charges for
                                                                                                                                      processing insurance claims or
                                                                                                                                      through the repair of damaged
                                                                                                                                      vehicles. The DFI site will also
                                                                                                                                      allow brokers to monitor the
                                                                                                                                      stage of each individual claim
       At DAS, we’ve been underwriting our own award-winning                                                                          as it is processed.
       legal expenses insurance products for more than thirty years.                                                                     The company claimed
       That’s thirty years of experience and thirty years of making                                                                   that in its first six months
       our own decisions without having to refer them to an                                                                           of trading it has seen more
       underwriter.                                                                                                                   than £4m of premiums put
       If you want to ask a question about legal protection from                                                                      up for competitive bidding
       someone who can actually give you an answer, come and                                                                          on its site. Almost 50 brokers
       talk to us at STAND K7.                                                                                                        have registered and its panel
       T 08456 665 464 E                                                                                             of fleet insurers includes
                                                                                                                                      Brit, HSBC, Axa, Allianz
       DAS Legal Expenses Insurance Company Limited is authorised and regulated by the Financial                                      and Zurich.
       Services Authority.
                                                                                                           www.   das           Paul Samways, director
                                                                                                                                      of DFI, said: “The penalties
                                                                                                                                      incurred in the handling of fleet    Samways: claims charge removed.

 Some might struggle with
 forward thinking…

                                                     But our eye’s on the future
The insurance market is changing
fast and brokers need their business
partners to rise to the challenge.

That means offering easy access to a
full range of user-friendly commercial
products that can put them in the
driving seat - with quick quotes,
guaranteed premiums, immediate cover
confirmation and swift document issue.

So at Groupama, we’ve optimised
our commercial product range for
electronic trading. From comprehensive
tradesman’s covers right through to
small fleets, property owners and the
usual packages - our brokers can find
what they need at Optima Online –
our innovative broker extranet.

And if they prefer to access our services
through imarket – they can log on
there too – with the bonus of end to
end connectivity with a growing
number of software houses.

So for a switched on approach to SME
business keep an eye on the future –
with Groupama.

Groupama Insurances 24-26 Minories London EC3N 1DE
Telephone: 0870 850 8510

Authorised and regulated by the FSA                             Future Focused

                         Rules of engagement
       The Financial
Services Authority’s
      regime for the
                                 BRITISH rule-makers take         conflicts. Subsequent informal       The paper also brings delegated
   insurance sector              a somewhat ‘enthusiastic’        discussions highlighted that the    authorities, managing general
  has been in place              approach to compliance,
                                 compared to what I have
                                                                  work already done by many UK
                                                                  intermediaries in identifying
                                                                                                      agents and work transfer from
                                                                                                      insurers into the debate.
     for three and a             witnessed elsewhere in Europe.   and managing conflicts                 We continue to believe a
                                 Take the current debate in       — including putting formal          market-led solution is not only
       half years yet            the UK regarding conflict        processes in place to disclose      achievable but desirable, and
                                 management and transparency.     commission upon request and         we are working hard to bring
   regulation is still             At the recent BIPAR            being more transparent in terms     the ingredients of a possible
                                 (European Federation of          of business agreements — puts       solution together. But in the
   a major headline              Insurance Intermediaries)        these firms well ahead of most       meantime the FSA’s 25 June
       driver, writes            meeting in Madrid, my
                                 British Insurance Brokers’
                                                                  of their European counterparts.
                                                                  It also underlined the dichotomy
                                                                                                      deadline for replies is fast
                                                                                                      approaching. Let me take this
     BIBA chairman               Association colleagues gave      of the Financial Services           opportunity to once again
                                 a presentation on how UK         Authority’s more principles-        implore you to formally respond
   Derek Thornton.               intermediaries are managing      based regulatory approach on        to the FSA if you have a view.
                                                                  the one hand, and the ‘threat’ of   Please take the time.
                                                                  mandatory commission
                                                                  disclosure on the other.            TCF workshops
                                                                     While in Madrid I was also       During the winter, BIBA
                                                                  able to listen to the views         successfully ran nine treating
                                                                  of Karel Van Hulle, head            customers fairly workshops
                                                                  of insurance and pensions,          around the UK. Nearly 300
                                                                  internal markets and services       members took the opportunity
                                                                  at the European Commission.         to hear the FSA explain in
                                                                  Mr Van Hulle’s unit holds           more detail about both culture
                                                                  responsibility for the Insurance    and management information,
                                                                  Mediation Directive, and he         and the very positive feedback
                                                                  left the audience in no doubt       is certainly encouraging.
                                                                  that now was not the time for       This response, coupled with
                                                                  “revision” of the IMD. Despite      the high number of hits
                                                                  pressure from certain European      on the ‘BIBA guide to TCF
                                                                  Union states, the directive needs   management information’ site
                                                                  time to bed-in before a full        lead me to believe our members
                                                                  review of effectiveness can take    are taking this subject very
                                                                  place and before any revision       seriously and cracking on with
                                                                  could be contemplated. In the       implementation ahead of the
                                                                  meantime, a review of how the       FSA’s year-end deadline.
                                                                  IMD has been implemented will          Like me, I’m sure you have
                                                                  be carried out.                     noticed the increasing amount of
                                                                                                      TV advertising space taken up
                                                                  Broker transparency                 by insurance price comparison
                                                                  The discussion paper DP08/2 by      websites. BIBA’s interest in this
                                                                  the FSA has widened the whole       arena must not be confused
                                                                  debate about transparency           with a luddite approach.
                                                                  and conflict management. The         We are 100% in support of
                                                                  paper sets out six objectives       innovative technology that
                                                                  the regulator is focusing on        assists distribution, but there
                                                                  to achieve its overall goal of a    are enough issues at play
                                                                  more efficient and competitive       here to create the potential for
                                                                  market. Many intermediaries,        consumer detriment and I am
                                                                  I am sure, will argue the UK        pleased the FSA is taking an
                                                                  commercial insurance market         active interest. This completes
                                                                  is already competitive but          an impressive hat-trick for
                                                                  firms do need to consider the six    BIBA’s motor committee, which
                                                                  outcomes in any formal reply        has had notable additional
                                                                  they submit to the FSA.             successes in reducing uninsured
                                                                     These six objectives contain     driving and the introduction of
                                                                  a mixture of the old and the        electronic motor certificates.
                                                                  new, adding weight to the              Finally, what issues might
                                                                  belief that the draft paper         we be writing about in 12
                                                                  is widening the scope of the        months time? The FSA recently
                                                                  debate. They include disclosure     announced it will be reviewing
                                                                  of the total commission paid to     the client money rules and
                                                                  intermediaries throughout the       publishing a consultation paper
                                                                  chain, clear information about      early in 2009. The Client Assets
                                                                  the intermediary’s services         Sourcebook rules have always
                                                                  and the breadth of search           proved a fertile ground for debate
                                                                  undertaken, the capacity in         and no doubt this consultation
                                                                  which the intermediary is           paper will provide me with
                                                                  acting and the standardisation      material for next year’s
                                                                  of the disclosure information.      conference daily.               ■
                                                                                                            COMMENT — BRAND                7

                                                                                                                    At a time when
Battle of the brands
THE brands                                               is worth        including reassurance borne
                                                                                                                    insurers are
                                                                                                                    changing or
                                                                                                                    abandoning some
we recognise                                             nothing if      out of brand familiarity.
and favour say
much about us
                                                         you do not
                                                         offer the
                                                                         Surely you might offer the
                                                                         choice, providing the insurers
                                                                                                                    of the most well
as individuals,                                          product         keep some of the familiar                  known brands in
but is our                                               required        brands alive. This would
view of them                                             or are too      result in increased confidence              the sector Mark
affected if                                              expensive.      for the insured, higher premium
we buy them indirectly or           Brand is a differentiator when       to the insurer and better                  Winlow examines
by the intermediary which           all other things are nearly equal,   business for the broker.
delivers them? I believe            be that price, cover or terms.          Perhaps the travel agent will           the value of
insurers are missing a trick in
the personal lines insurance
                                    Many of my contemporaries
                                    tell the same story of trying
                                                                         offer you executive class seats
                                                                         next time you call.           ■
                                                                                                                    insurers’ brands
market and weakening the            to get insurance for a son                                                      to brokers and
broker proposition.                 or daughter who is a newly           Mark Winlow is director
   Imagine you are a successful     qualified driver — they can          at LECG                                    their clients.
insurance broker with the time      only get cover from an insurer
and the funds for an exotic         they’ve never heard of or, more
holiday. You approach a travel      likely, the insurer they have
company that offers the type        heard of is too expensive.
of holiday you seek and they
quote a very good price.            Temporal reputation
   On further enquiry, you          Third, a brand’s reputation is
find that the airline you will       temporal and, as a result, will
be flying with sounds dodgy          have varying effects in different
and unfamiliar. Would you find       customer segments. My children
out how much extra it is to fly      will be most familiar with
British Airways or Virgin? If       brands such as Sheilas’ Wheels
it is not too expensive, would      or Churchill — assuming they
you choose the better-known         are still around when they come
carrier? What if the travel         to buy insurance.
agent repeatedly suggested the         However, brands can endure
unfamiliar airline? Would you       once they become familiar.
conclude that they did not care     As a young buyer of general
about you as a client?              insurance, the sensible choices
   The analogy is simple,           for me were long-standing
but insurance is more               insurers like Royal Insurance,
complicated isn’t it?               Sun Alliance, Commercial
                                    Union, General Accident or
Overall performance                 Eagle Star. Some of the life
First, insurance can be             insurers did a bit too, Norwich
purchased through a number          Union and Prudential for
of channels. You can go direct      instance. Virtually all have
to an insurer on the phone;         gone and it was announced
you can access a broker’s           on Tuesday that the Norwich
website; you can even buy           Union name will also now be
travel insurance on your mobile.    ditched and replaced by Aviva.
Strong brands exist in more             People of a similar age to
than one distribution channel       me will continue to buy
and reputation in one will affect   insurance for decades to come
performance in another.             and would continue to be
   This was recognised some         reassured by familiar names.
15 years ago but, back then,        Surely, all that past brand
several insurers sought to          investment is worth something?
weaken the links between their      The Prudential obviously
consumer direct and broker          thought so when it ‘rented’ its
offerings. New brands, such         brand to Churchill.
as The Insurance Service from          A broker should be well
the Royal, were introduced.         positioned to understand
   Second, a strong brand           the policyholder’s needs,
My mother-in-law recently decided to change her household insurer.
For many years, she had renewed her policy with a well-know affinity
organisation. This year her premium had been increased again                    Enjoy a relaxing Indian head
prompting her to consider changing.
   She had been targeted by a number of organisations, one of which             massage and watch our new
was a broker that offered her a much cheaper premium. However,
she did not know the insurer and preferred to use a brand she knew.             TV commercial at Stand E16    
In the end she paid a slightly higher premium for one of the more
traditional and longer-standing insurer’s products.
   Oh, the brand she rejected? AIG – never heard of them!

                                                                                                                         1 MAY 2008 BIBA DAILY

               The price is wrong
                                                                                                             We’ve just seen a shift in
                                                                                                          the law regarding corporate
                                                                                                          manslaughter, with personal
                                                                                                          penalties — including a
                                                                                                          jail sentence — a realistic
                                                                                                          threat for managers. Good
              The insurance sector has a real                          An economic downturn
                                                                    would hit the insurance sector
                                                                                                          brokers, working with
                                                                                                          insurers, will have flagged
         opportunity to influence the future,                        hard. If the business world is        this already and recommended
                                                                    suffering there will be pressure      appropriate action — because
          asserts Laurent Matras, managing                          on prices. Some buyers may            that is the kind of service
                                                                    not even make it to renewal,          clients appreciate and are
           director of Groupama Insurances.                         while others might have to            prepared to pay for.
                                                                    downsize operations and,                 In an era of economic stress,
                                                                    inevitably, their insurance           the last thing companies need
GOOD news is in short supply.       are tough times ahead with      requirements too.                     is to be struck by a problem
It has been said that if you laid   the threat of recession            Grimmer still is the fact most     that could have been prevented.
all the world’s economists end      looming in the US, and the UK   classes of business insurance         A crisis that could have been
to end, they still would not        adjusting to an economy no      are already at the lower end          averted in times of plenty
reach a conclusion. But most        longer fuelled by a booming     of the cycle. Hardening prices        can become insurmountable
commentators agree there            housing market.                 should be on the horizon but          when circumstances are less
                                                                    market feedback suggests              benign. The ne ed for
                                                                    all there is in prospect is           prevention is, therefore, more
                                                                    continued weakness — and              pressing than ever.
                                                                    that is a worry.                         That is not to say business
                                                                       In the small to medium-sized       leaders will roll out the red
                                                                    enterprise sector increased           carpet for us. They have
                                                                    competition from direct sales         lots on their plates, and we
                                                                    will not help and, if new             will have to work harder
                                                                    players buy market share with         than ever to get our value
                                                                    unrealistic prices, it really could   argument across. It comes
                                                                    be a summer of discontent.            down to convincing them we
                                                                       But I am not offering a            are not pushing a sale but
                                                                    counsel of despair. The               providing support to help
                                                                    broking sector has a great            them weather the storm.
                                                                    opportunity to influence                 It is also the case that
                                                                    tomorrow and create a viable,         financial directors intensely
                                                                    sustainable market that works         dislike the insurance cycle.
                                                                    to the benefit of all.                 They want to plan ahead with
                                                                    If we do not drag prices                               knowing how
                                                                                                                           their costs
                                                                    off the floor soon it is                                will move in
                                                                    going to be crunch time.                               the next five
                                                                                                                           years. They do
                                                                       The key is to shift                not want a bargain-basement
                                                                    policyholder perceptions of           premium this year if it means
                                                                    insurance. No-one wants to            a doubling next year and
                                                                    pay more than they have to for        another ride on the roller-
                                                                    something that is mandatory,          coaster the year after.
                                                                    or effectively so, and with no           At Groupama, robust
                                                                    perceived benefit. We must            technical pricing is the bedrock
                                                                    influence opinion so buyers            upon which we build, and
                                                                    recognise the value of the            surely brokers’ clients should
                                                                    protection we offer and accept        expect nothing less from
                                                                    it demands a fair price.              other insurers too?
                                                                       Let us stop marketing                 Financial         directors
                                                                    insurance as a product that           understand insurers must
                                                                    merely safeguards a business          balance the books but we have
                                                                    if something goes wrong.              to continue to educate them to
                                                                    We need to emphasise the              understand claims costs are
                                                                    positive role we can play in          rising and that there is less
                                                                    making them more efficient,            of a turn to be made on our
                                                                    more compliant and more               investments. Frankly, if we do
                                                                    successful. We need people to         not drag prices off the floor
                                                                    think of insurance as a service       soon it is going to be crunch
                                                                    that makes things go right.           time — and you only have to
                                                                       That means shifting                look at our banking friends to
                                                                    the spotlight from the                see what that means.
                                                                    indemnities that are the                 So it is up to us. Cheap is
                                                                    cornerstones of a policy.             cheap and always will be.
                                                                    The real focus should be on           The market needs to work
                                                                    areas of added value, such            together to influence, inform
                                                                    as health and safety, legal           and educate customers
                                                                    and HR advice, and business           to value what we have to
                                                                    continuity — the issues               offer and to ensure that
                                                                    businesses lose sleep over.           the price is right.          ■
Behind the scenes
support for your
household business…
•    Dedicated account management

•    Regional broker offices

•    High standard of claims and customer service

•    Flood command team

•    Marketing expertise

•    Flexible underwriting

…from Legal & General, a team you can rely on.
    (Just a few of whom you can see here!)

Our service is great, how good is yours? To find out,
please come and see us at stand G8 at this year’s
BIBA conference in Glasgow.

For more information on our products and services, please
register at

This is not a consumer advertisement. It is intended for
professional insurance intermediaries and should not be
relied upon by private customers or any other persons.

Legal & General Insurance Limited.
Registered in England No 423930.
Registered office: One Coleman Street, London EC2R 5AA.
A member of the Association of British Insurers.

Q17088 02/08 H88579
10        ROUNDTABLE

                                                                      l-r: Carole Lowe, John McLaren-Stewart, Charles Earle, Andrew Tjaardstra,
                                                                      Neil Campling, Darren Wills and Maggie Cowing.

             2008: fresh water
   Stand F21

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                                                                                         brokers money ...
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              See our new commercial online quote facility                               our regional underwriters, our
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  ·                      markets, then we should talk.

                                                                                                            ROUNDTABLE                         11

                                             Nine months on from the 2007 floods, an objective picture
                                             is developing of the catastrophe’s devastation — and the
                                             industry’s subsequent reaction. Andrew Tjaardstra chairs a
                                             roundtable to discuss its impact, as well as find out what
                                             lessons, if any, can be learnt to better prepare the sector.

                                             ANDREW TJAARDSTRA:                GUEST LIST
                                             The first topic for debate
                                                                               Andrew Tjaardstra (chairman), editor, Professional Broking
                                             today will be the summer
                                             floods of 2007. What do you        Neil Campling, managing director, Barnett and Barnett
                                             believe has been the overall
                                             impact of the floods in terms      Maggie Cowing, loss adjusting services technical director,
                                             of both costs and your clients?   Cunningham Lindsey
                                             Are there any positives we can    Charles Earle, chief executive, Arista
                                             take from the experience and
           Roundtable pictures: Joy Ekpeti

                                             what improvements, if any,        Carole Lowe, regional director East, Jelf Insurance Brokers
                                             can be made?                      John McLaren-Stewart, chief executive, Alliance corporate risk
                                                                               management; British Insurance Brokers’ Association board member
                                             MAGGIE COWING: Now
                                                                               Darren Wills, claims planning and performance manager,
                                             that it’s nine months down        Groupama Insurances
                                             the line, sometimes it is easy
                                             to forget the huge scale of       normal monthly June claims           but that we were still reeling

                                             the floods and that it was         — I’m sure that experience           from the damage when the
                                             a one-in-150-year event.          is reflected by others. When          July ones hit.
                                             There were something like         focusing on what went well
                                             55 000 individual premises        and what could have gone             CHARLES EARLE: It is also
                                             affected and more than 60 000     better, we have to remind            worth noting this was the
                                             claims generated in a short       ourselves of the massive hit         biggest property damage
                                             period of time. Certainly, we     the insurance industry took;         occurrence since the Second
                                             found we had 10 times the         not just from the June floods,        World War.                        >12

                                                                                                                              1 MAY 2008 BIBA DAILY
      12         ROUNDTABLE

                                                                                                                                         PA Photos
       Flood losses and GI profits 2007                                                                                                               Tewkesbury, Gloucestershire: widespread
                                                                                                                                                     chaos last summer due to flooding.
       Insurer                                              2007 losses                                        GI Profit H1
                                             Jan                 June                     July             2007              2006
       Norwich Union                       £60m                £175m                   £165m              £269m            £561m
       RSA                                  n/d*                £55m                    £65m               £51m              £95m
       Royal Bank of Scotland Insurance            £250m (for total weather losses)                       £255m            £324m
       Halifax Bank of Scotland GI         £20m                 £60m                    £70m              £107m            £163m
       Zurich                                n/d               £198m                   £129m                  n/d               n/d
       Axa                                         £115m for Jan/June                  £130m               £83m            £124m
       Legal and General GI                 £8m                 £40m                    £30m          £52m loss               £2m
       Allianz Insurance                            £50m for Jan/June                   £35m           £105.4m             £102m
       Hiscox UK and Europe                         “Losses within expectations”                          £6.6m           £17.8m
       Brit Insurance                        n/d                 £8m       “Slightly less than            £8.5m           £30.4m
       Ecclesiastical                              £114m for Jan/June                      TBC           £28.7m           £27.8m
       Fortis                                n/d                £24m                       TBC                n/d               n/d
       Lloyds TSB                                   £45m for Jan/June                   £45m               £59m            £114m
       Co-operative Insurance                  £55m (for total 2007 weather losses)                           n/d               n/d
                                                                   *not disclosed   Source: Post Magazine; figures as of September 2007
      MAGGIE COWING: It is                JOHN MCLAREN-                               CAROLE LOWE: It can also
      really important that we            STEWART: What the                           be difficult to get these people
      learn the lessons though.           floods did do was to                         into the affected area; there
      It was unprecedented                create an economic spike.                   are logistics problems to think
      and perhaps it took us by           All of a sudden there’s a                   about as well.
      surprise because of the             big rush of tasks to
      sheer scale of it, but              complete and I’m not sure                   DARREN WILLS: One of
      everything we now know              we can ever be prepared for                 the things we saw, which the
      about climate change                that. You cannot have, say,                 loss adjusting community
      suggests it won’t be                100 spare builders just                     did particularly well, was
      another 150 years before            waiting around in case                      community events organised
      it happens again.                   another occurs.                             by adjusters in areas affected

                                                                                                                                                             by the floods. They tried to
                                                                                                                                                             manage public expectations
      I sometimes wonder which would be worse: to concentrate on getting a few                                                                               and provide policyholders
                                                                                                                                                             with a timeline, as well as
      clients seen quickly so their claims are completed, but the others suffer; or                                                                          inform them there was a
      to spread the builders and contractors out to do half a job for everyone and                                                                           shortage of suppliers and
                                                                                                                                                             explaining the drying out
      slowly get everyone sorted around the same time. McLaren-Stewart                                                                                       process. Some of this good
                                                                                                                                                             work got lost [in the media]
                                                                        The subject at hand: John McLaren-Stewart,                                           behind one or two bad events
                                                                        left, and Charles Earle.                                                             that rose to the surface.

                                                                                                                                                             JOHN MCLAREN-
                                                                                                                                                             STEWART: Shouldn’t all
                                                                                                                                                             this be task-force controlled
                                                                                                                                                             though? It is a big issue
                                                                                                                                                             and yet the insurers are
                                                                                                                                                             expected to carry out loads
                                                                                                                                                             of different things; talking
                                                                                                                                                             to loss adjusters, talking to
                                                                                                                                                             the clients. Also, the builders
                                                                                                                                                             have to do their bit because
                                                                                                                                                             what we are seeing in the
                                                                                                                                                             national press are a few
                                                                                                                                                             rogue builders operating
                                                                                                                                                             after the floods. I wonder
                                                                                                                                                             sometimes which would be
                                                                                                                                                             worse: to concentrate on
                                                                                                                                                             getting a few clients seen
                                                                                                                                                             quickly so their claims are
                                                                                                                                                             completed, but the others
                                                                                                                                                             suffer; or to spread the
                                                                                                                                                             builders and contractors out
                                                                                                                                                             to do half a job for everyone
                                                                                                                                                             and slowly get everyone
                                                                                                                                                             sorted around the same
                                                                                                                                                             time. The most important
                                                                                                                                                             thing of course is to ensure
      BIBA DAILY 1 MAY 2008
                                                                                                                                                                                                                 ROUNDTABLE                        13

                                                                                                                Andrew Tjaadstra
                                                                                                                puts the questions.

                                                                                                             your clients feel safe and                              one loss adjuster who worked                       understand the reasons for
Estimated insured losses                                                                                     comfortable.                                            with the one insurer; brand                        the insurer choosing to do
Estimated insured cost of the three events in 2007. Insured losses were                                                                                              issues were not a concern                          that, once that loss adjuster
estimated at more than £3bn.                                                                                 DARREN WILLS: To be                                     because the reputation of                          has reached their capacity…
Month                   Event                                            Cost to insurers                    fair, the Association of                                the whole industry was on
                                                                                                             British Insurers did a lot of                           the line. I thought everyone                       CHARLES EARLE: Yes, I
January                 storm Kyrill                                     £350m                               work in terms of ensuring                               co-operated quite well.                            would say that any loss
June                    North floods                                     estimated £1.5bn                    consistency in how the floods                                                                               adjuster should work for
July                    South and Midlands floods                        estimated £1.5bn                    were handled across the UK.                             NEIL CAMPLING: Our claims                          anyone in that area who
                                                                                                                                                                     guys were telling me that                          needs them.
The vast majority of these losses will be property related, including business                               CHARLES EARLE: The                                      they did run into problems
interruption, although motor and liability losses are also expected.                                         industry quickly learnt it                              when an insurer had only                           MAGGIE COWING: At
Source: S&P July 30 2007                                                                                     was not the case of using the                           one loss adjuster. While I can                     one stage there was a mood
                                                                                                                                                                                                                        among insurers where
                                                                                                                                                                                                                        they said ‘why don’t we
2006 gross premium written as % of UK total                                                                                                                                                                             allocate different areas
                                                                                           Allianz          Aviva UK         Axa Insurance             Royal and Sun                 Zurich Insurance                   for different loss adjusters?’,
                                                                                         Insurance                            Group (UK)                 Alliance                  Company (UK Branch)                  but it never really took off.
                                                                                                                                                                                                                        I’m not sure whether it
Insurance financial strength rating                                                           A1               Aa3                   Aa3                        A3                               A1
                                                                                                                                                                                                                        would have been practical
Retail/personal            Property                                                            7%                18%                 11%                         14%                             16%                    to do and maybe that is
                           Motor                                                               8%                17%                   8%                        15%                             18%                    a lesson for the future.
                                                                                                                                                                                                                        If we could do some pre-
                           Other                                                             21%                 15%                 41%                          3%                               1%                   planning, rather than trying
Commercial                 Property                                                          15%                   9%                16%                         18%                             16%                    to do it on the hoof; if we
                           Consequential loss                                                  3%                  1%                  1%                         2%                               2%
                                                                                                                                                                                                                        could get some kind of
                                                                                                                                                                                                                        measure with everyone
                           Liability (employers, public and                                  11%                   6%                11%                         14%                             23%                    signing up, it would be great.
                           product, and professional indemnity)                                                                                                                                                         But the proposal was left late,
                           Motor                                                             16%                   7%                  6%                        17%                             15%                    so it was doomed to failure.
                                                                                                                                                                                                                        However, they did attempt it
                           Other                                                             16%                   3%                  4%                         8%                               7%
                                                                                                                                                                                                                        via the property groups and
Marine, aviation and transport                                                                 3%                  0%                  1%                         6%                               0%                   the ABI.
Treaty reinsurance                                                                             0%                25%                   1%                         3%                               2%
Source: UK FSA returns form 20A
                                                                                                                                                                                                                        CHARLES EARLE: I think
NB Aviva UK consists of aggregated GWP figures for legal entities Aviva International Insurance (all), Norwich Union Insurance Ltd and Gresham Insurance Company Ltd. Treaty business relates to internal proportional   that would be worth doing,
reinsurance of Group UK business that be eliminated on consolidation. Internal treaty business consists of Accident and health (11%), motor (46%) and property (31%)                                                    especially as floods are likely
Line of business descriptions: retail property — cat 160; retail motor — cat 121-123; retail other — cat 111-114, 181-187; commercial property — cat 261; commercial consequential loss — cat 262; commercial
liability — cat 271-273; commercial motor — cat 221-223; commercial other — cat 263, 274-284; marine, aviation and transport —cat 331-350; treaty reinsurance — cat 610-700                                             to happen again.               >14

                                                                                                                                                                                                                                  1 MAY 2008 BIBA DAILY
      14        ROUNDTABLE

<13                   This really could be an opportunity for brokers. The
                    negative criticism we have heard has generally been
               about service, not whether or not the insurer will pay the
                 claim. It is the speed of service and the communication
                     side where brokers can show their worth. What the
                experience has brought to the fore for the public is that,
                 for the first time, they are realising what it is they really
                                                  want from their insurers.
                                                                            Maggie Cowing

           Building a
           Premium Finance Solutions
           that work for you.                      future                                   Cowing: flood resources were over-stretched.

                                                                                            MAGGIE COWING: One
                                                                                            of the issues that came out
                                                                                                                                DARREN WILLS: The natural
                                                                                                                                expectations of people
                                                                                            of the floods was resources          nowadays, when they make
                                                                                            were clearly overstretched.         a claim, is that it will all be
                                                                                            There just aren’t enough loss       sorted in a matter of weeks,
                                                                                            adjusters; we found ourselves       but the nature of the flooding
                                                                                            bringing in loss adjusters from     meant that the timeline for
                                                                                            other parts of the country, and     claims was beyond most
                                                                                            even other parts of the world,      clients’ expectations.
                                                                                            and there still weren’t enough.
                                                                                            It was the same with builders,      CAROLE LOWE: Customers
                                 Personal and Commercial   Non Recourse Options             alternative accommodation           just weren’t prepared for an
                                 Lines Premium Finance                                      and drying companies, so            eight-month wait.
                                                                                            there was a lot of prioritisation
                                                                                            going on. Unfortunately, for        NEIL CAMPLING: Exactly,
                                                                                            every priority person at the        which is why communication
                                                                                            top, there is always going to be    is so important. Clients need
                                                                                            someone at the                      bite-sized reports to reassure
                                                                                            bottom whose claim is going         them and show how their
                                                                                            to take a little longer. The        claim is progressing.
                                                                                            biggest lesson that came out
                                                                                            of the floods was the need for       MAGGIE COWING: What
                                                                                            good communication. Brokers         a lot of insurers are doing
                                 Integrated EDI            Tailored Funding Solutions       need to communicate with            now is reviewing their supply
                                 Premium Finance
                                                                                            insurers and their clients to       chain arrangements and one
                                                                                            manage their expectations           of the points made was that it
                                                                                            — as far as I saw, that worked      was rather disjointed at times.
                                                                                            during the floods.                   You would have contractors
                                                                                                                                turning up to a repair a
                                                                                            JOHN MCLAREN-                       house that was still being
                                                                                            STEWART: Of course, talking         dried out and homeowners
                                                                                            to your clients is fundamental      receiving replacement
                                                                                            at a time like that.                washing machines before
                                                                                                                                their house had been repaired.
                                                                                            MAGGIE COWING: Yes,                 Perhaps it would be good
                                                                                            even if you only say to the         to have a single point of
                                                                                            policyholders ‘I’m sorry, but       contact on the claim so that
                                                                                            it is going to take at least        the loss adjuster acts more
                                                                                            another month’, at least you        as a project manager, rather
                                                                                            have told them something.           than just another part of a     >16

      BIBA DAILY 1 MAY 2008
our racecar challenge.
how will you shape up?

Find out when you come and see how we’re shaping up
Pop along to stand A12, and you’ll meet the people who know what’s what – about how
we’re facing the challenges of 2008, our newly available RAC products and our exclusive 110 club.
And talking of challenges, why not come and set a cracking pace in our racecar tyre change?

we know what’s what
Issued for use by insurance intermediaries only. This information has not been approved for use with customers.
Norwich Union Insurance Limited. Registered in England No. 99122. Registered Office: 8 Surrey Street Norwich NR1 3NG. Authorised and regulated by the Financial Services Authority.
      16        ROUNDTABLE

<14      Brokers can feel                                                                                                           speed of service and the
                                                                                                                                    communication side where
         a bit helpless in                                                                                                          brokers can show their
      [flood catastrophe]                                                                                                            worth. What the experience
                                                                                                                                    has brought to the fore for
        situations as you                                                                                                           the public is that, for the first
            cannot really                                                                                                           time, they are realising what
                                                                                                                                    it is they really want from
          do anything for                                                                                                           their insurers.
         the client — all                                                                                                           CAROLE LOWE: Brokers
          you can offer is                                                                                                          can make sure insurers meet
             reassurance.                                                                                                           their clients’ expectations
                                                                                                                                    and that those expectations
                                                                                                                                    are realistic. It is important
                                                                                                                                    to get the communications
                                                                                                                                    between the client, broker
                                                                                                                                    and insurer right very
                                                                                                                                    early on.

                                       Talking points: Neil Campling listens to Darren Wills.                                       CHARLES EARLE: It is as
                                                                                                                                    simple as explaining to
                                                                                                multi-faceted claims resolving      the client ‘there’s been a
                                                                                                process. On the management          massive flood across most
                                                                                                information and IT side,            of the country and because
                                                                                                we learnt that a lot of the         of that, there is a shortage
                                                                                                communication could be              of builders’. You need to
                                                                                                improved — perhaps we               tell them exactly what is
                                                                                                could get to the stage where        happening.
                                                                                                brokers and insurers can go
                                                                                                online and see our portfolio,       MAGGIE COWING: One
                                                                                                detailing exactly where             thing we could reflect on
                                                                                                everybody is with the claim.        when it comes to personal
                                                                                                If we had a similar incident        lines policies of private
                                                                                                tomorrow, we’d still encounter      individuals, is that it is not just
                                                                                                a big resource problem. What        about the money with them.
                                                                                                we need to ask is how to            It is often a hugely stressful
                                                                                                make the most of the IT and         event they have been through
                                                                                                technology available, so we         and there may be an amount
                                                                                                can get the best out of all         of depression and anxiety.
                                                                                                the contractors.                    Perhaps we should have
                                                                                                                                    someone looking at the more
                                                                                                ANDREW TJAARDSTRA:                  human side of flood losses.
                                                                                                What can insurance brokers
                                                                                                do to help?                         CHARLES EARLE: The
                                                                                                                                    industry as a whole should
                                                                                                JOHN MCLAREN-                       recognise that something
                                                                                                STEWART: Brokers can feel a         extraordinary has happened
                                                                                                bit helpless in these situations,   and [in the eyes of the public]
                                                                                                as you cannot really do             it should actually appear to
                                                                                                anything for the client — all       care about it.
                                                                                                you can offer is reassurance.
                                                                                                                                    CAROLE LOWE: More
                                                                                                DARREN WILLS: Yes, some             could have been done to
                                                                                                brokers want to become              work alongside local
                                                                                                more involved in the process.       authorities too.
                                                                                                When a big event like this
                                                                                                kicks off it is difficult for        CHARLES EARLE: Yes, and
                                                                                                the insurer to ascertain how        better communication with
                                                                                                involved the broker wants to        utilities companies so we
                                                                                                be though.                          could tell clients when they
                                                                                                                                    would have clean water again.
                                                                                                NEIL CAMPLING: And some             These things are completely
                                                                                                brokers don’t want to be            outside insurers’ control.
                                                                                                involved at all.
                                                                                                                                    NEIL CAMPLING: I just
                                                                                                MAGGIE COWING:                      wanted to end the discussion

                        0845 602 5809
                                                                                                This really could be an             on a positive note. Overall,
                                                                                                opportunity for brokers.            we found the insurers to be
                                                                                                The negative criticism we           very flexible about authorised
                                                                                                have heard has generally            repairs and that has to be
                                                                                                been about service, not             commended in light of the
                                                                                                whether or not the insurer          difficult circumstances the
                                                                                                will pay the claim. It is the       industry was under.          ■

                                                                                                See tomorrow’s BIBA Daily for part two of this special roundtable
                                                                                                with a focus on MGAs
      BIBA DAILY 1 MAY 2008
                R emember, i

                                                             e  cogs
                                                   that ke


                                                                           ig w                   g.
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                                                                                                                                                                                      1 MAY 2008 BIBA DAILY
20         POSTSCRIPT

 Today at a glance: Thursday 1 May
09.30 - 10.00    Opening address: Derek Thornton, BIBA chairman
                 Eric Galbraith, BIBA chief executive
10.00 - 11.15    Influencing tomorrow panel: Professor Stephane Garelli, Dr Noreena Hertz, Hon James Rubin
11.25 - 14.10    Exhibition/Lunch
14.10 - 15.00    STREAM ONE: Motor insurance issues                     STREAM TWO: The psychology of              STREAM THREE: Online threats Harry Croydon,
                 Barry Smith, Fortis                                    persuasion Phillip Hesketh                 Coverpoint/James Harrison, Insurancewide
15. 00-16.00     Refreshment
16.10-17.00      STREAM ONE: Managing tomorrow’s risks Dr Alan          STREAM TWO: Dealing with pressure          STREAM THREE: Listen to the customer Tony
                 Punter/Alex Hindson Aon Global Risk Consulting         Lucy Beresford                             Tarquini, Celerant Consulting
17.30            Exhibition closes.

        A little taste of
        Scotch courage
                                                                                                                                           Above: Andy Hawkes — THB is 40
                                                                                                                                           years old and hippy to be at BIBA.

Legal and General: didn’t Wii                                                                         Above: thanks to Lorega the event
have a lovely time at the                                                                             was mooosic to brokers’ ears.
BIBA party.                                                                                                                                Above: could this be the last
                                                                                                                                           showing for the NU brand?

    Right: Orange Wednesday on
                the Iprism stand.

Big bang theory: brokers were
marching to the same tune this year.

                                                                                                      Getting in a lime pickle: not a drop has passed my lips yet — honest.


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