UK Personal Insurance Broker Survey 2009

Published by: Datamonitor

Published: Nov. 6, 2009

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

List of Figures

Figure 1: More than a third of brokers identified personal lines insurance to constitute the largest proportion of their turnover

Figure 2: 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 3: The majority of brokers do not intend to sell their business within the next two to three years

Figure 4: Around one third of brokers have been approached by a consolidator over the last 12 months

Figure 5: A significant proportion of brokers stated that they had been contacted by Swinton

Figure 6: A quarter of brokers are considering acquiring a fellow broker over the next 12 months

Figure 7: Only 9% of brokers are considering joining a network in the next 12 months

Figure 8: Direct insurers and aggregators were viewed as the biggest threat to brokers' business

Figure 9: Only 4.7% of brokers partner with an aggregator

Figure 10: More than 60% of brokers stated that they had a company website

Figure 11: Online sales only account for a small proportion of total revenue

Figure 12: Only one third of brokers that do not have a website plan to develop one

Figure 13: 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 14: Allianz and Zurich were cited as the two best insurers to deal with

Figure 15: Excellent claims handling and rapid query response are valued the most by brokers

Figure 16: About 20% of respondents cited RSA and Aviva as two insurers that have the opportunity to improve their service level to brokers

Figure 17: Poor service and inflexibility were the major reasons behind broker dissatisfaction with their insurer partners

Figure 18: FSA regulation and compliance continue to be a concern for most brokers

Figure 19: Complying with FSA regulation cost a third of brokers more than 10% of their annual turnover

Figure 20: Around 40% of brokers perceived the impact of FSA regulation to be positive on the overall general insurance industry

Figure 21: Only 22.7% of brokers are satisfied with the level of work required to meet FSA regulations

Figure 22: More than half of brokers found insurers helpful in supporting them to meet compliance with FSA regulation

Figure 23: Just under half of brokers expressed that they would like to receive more support from their insurance partners in helping with FSA regulation

Figure 24: The majority of brokers have reviewed their costs in response to FSA regulation compliance

Abstract

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

• 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.

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