UK Personal Insurance Broker Survey 2009

UK Personal Insurance Broker Survey 2009 published by Datamonitor in November, 2009. This report consists of 26 pages and the price starts from US $ 2795.

Introduction

Abstract

Introduction

Datamonitor' s personal insurance broker survey analyses the opinions of 150 brokers covering their views on opportunities for growth as well as threats to their business, their experiences of working with different insurers and their attitudes towards regulation. The brief also offers insight into the factors which drive broker satisfaction and examines brokers' attitudes towards consolidation.

Scope of this research

• Information on the prevalence and the drivers of the broker network model.
• Insight into the level of satisfaction brokers have with their insurance partners.

Research and analysis highlights

While consolidation activities have been largely discouraged by the current recession, a significant proportion (36.0%) of respondents stated that they had been approached by a consolidator over the last 12 months.

Direct insurers and aggregators posed the largest threat to respondents, with 75.3% of brokers stating that direct insurers were the largest threat to their business, while a further 71.3% of respondents cited aggregators.

Key reasons to purchase this research

• Gain an insight into broker attitudes towards the greatest threats in the market.
• Understand broker appetite for acquisitions and future consolidation.
• Gain a greater understanding of the issues facing personal brokers in the UK.

Table of Contents

DATAMONITOR VIEW

• CATALYST
• SUMMARY

ANALYSIS

• Many brokers felt the proportion of their business made up of personal insurance would change in the next two to three years
  • More than a third of brokers stated that their revenue was primarily derived from personal lines insurance
  • Almost half of brokers expect a change in the proportion of their business dedicated to personal lines insurance
  • Around half of respondents believe that their personal lines business will grow in the next two to three years

• A third of brokers claimed they have been approached by a consolidator but most do not intend to sell their business within the next two to three years
  • Brokers are reluctant to sell their business within the next two to three years
  • Around one third of brokers claim they had been approached by a consolidator over the last 12 months
  • Out of respondents that had bean approached by a consolidator, 22% stated that they had been approached by Swinton
  • A quarter of brokers are considering acquiring other brokers in the next 12 months
  • Only 9% of respondents are considering joining a broker network in the next 12 months

• Direct insurers and aggregators pose the biggest threat to brokers, while more brokers have their own websites
  • Direct insurers and aggregators are still seen as the biggest threat to brokers' business
  • The majority of brokers do not currently partner with an aggregator
  • Over a third of respondents do not currently possess a website
  • The majority of respondents made less than half of their sales through the internet
  • A large proportion of brokers that do not have a website have no plans to create a website in the future

• A large proportion of brokers value ‘excellent claim handling' and ‘rapid query response' , and indicated that Allianz, Zurich and Fortis are particularly good to work with
  • Brokers are generally satisfied with their insurance partners' services
  • The majority of brokers think that Allianz, Zurich and Fortis are good to work with
  • Brokers value ‘excellent claim handling' and ‘rapid query response' the most
  • Brokers identified RSA and Aviva as insurers with the most opportunity to improve their service levels
  • Poor service from insurers remains a key concern among UK personal brokers

• Regulation and compliance continue to be important to brokers, with FSA regulation costing most brokers up to 10% of their turnover
  • More than half of the brokers surveyed intend to pursue organic growth, while regulation and compliance is a top priority for many brokers
  • Compliance with FSA regulation costs most brokers up to 10% of their turnover
  • Brokers hold mixed views towards the benefits of FSA regulation
  • The majority of brokers perceived the amount of work required to comply with FSA regulation is excessive
  • Brokers are generally happy with insurers' help in meeting FSA requirements
  • Less than half of brokers stated that they required more support from insurers
  • The majority of brokers have reviewed their costs and growth strategies in response to extra costs from FSA compliance

APPENDIX

• Methodology
• Further reading
• Ask the analyst
• Datamonitor consulting
• Disclaimer

FIGURES

• Figure: More than a third of brokers identified personal lines insurance to constitute the largest proportion of their turnover
• Figure: Just under half of brokers felt the proportion of their business made up of personal insurance would change in the next two to three years
• Figure: The majority of brokers do not intend to sell their business within the next two to three years
• Figure: Around one third of brokers have been approached by a consolidator over the last 12 months
• Figure: A significant proportion of brokers stated that they had been contacted by Swinton
• Figure: A quarter of brokers are considering acquiring a fellow broker over the next 12 months
• Figure: Only 9% of brokers are considering joining a network in the next 12 months
• Figure: Direct insurers and aggregators were viewed as the biggest threat to brokers' business
• Figure: Only 4.7% of brokers partner with an aggregator
• Figure: More than 60% of brokers stated that they had a company website
• Figure: Online sales only account for a small proportion of total revenue
• Figure: Only one third of brokers that do not have a website plan to develop one
• Figure: More than two thirds of brokers stated that they were ‘satisfied' or very satisfied with the level of service received from their insurer partners
• Figure: Allianz and Zurich were cited as the two best insurers to deal with
• Figure: Excellent claims handling and rapid query response are valued the most by brokers
• Figure: About 20% of respondents cited RSA and Aviva as two insurers that have the opportunity to improve their service level to brokers
• Figure: Poor service and inflexibility were the major reasons behind broker dissatisfaction with their insurer partners
• Figure: FSA regulation and compliance continue to be a concern for most brokers
• Figure: Complying with FSA regulation cost a third of brokers more than 10% of their annual turnover
• Figure: Around 40% of brokers perceived the impact of FSA regulation to be positive on the overall general insurance industry
• Figure: Only 22.7% of brokers are satisfied with the level of work required to meet FSA regulations
• Figure: More than half of brokers found insurers helpful in supporting them to meet compliance with FSA regulation
• Figure: Just under half of brokers expressed that they would like to receive more support from their insurance partners in helping with FSA regulation
• Figure: The majority of brokers have reviewed their costs in response to FSA regulation compliance

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