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The Personal Touch: talking Personal Lines

Dan McNally, our Group Insurer and Products Director, is talking Personal Lines and how a combination of Member feedback and analysis of the industry led to the launch of our dedicated Personal Lines panel – and what brokers can do to stand out from the crowd.

Price

Whilst the majority of our Members have a bias towards Commercial Lines, I know from speaking to Members that Personal Lines remains a crucial part of their businesses and will undoubtedly remain so as community based brokers. It’s the ‘community’ dimension of their portfolio that perhaps makes us such a fascinating segment of the market in today’s personal lines marketplace.

Much of insurers’ activity and investment appears to have been upon product, price and proposition that is focussed purely upon the end customer. In spite of this, if Members sit down with an insurer they will often tell them that regional broker business is more profitable and stickier at renewal.

So what are the barriers, and how can they be overcome?

Software house constraints

In my experience, there’s a lot that can be done to streamline the software house screens and make it easier to compare product specifics on a customer’s behalf. Trying to extract data from multiple extranets can be extremely time consuming, and it seems that aggregator sites are leading the way in terms of user friendly technology. This in turn drives the focus on price that insurers worry about.

Reflecting brokers’ value

In the past, the ability for insurers to respond to the huge value that smaller brokers offer with bespoke work has been inhibited by system constraints and backlogs of work. Unfortunately, large volumes of business take precedence which leaves smaller brokers at the back of the queue, despite their rich value in ensuring accuracy and reducing fraudulent activity.

Cost of tailored product delivery

Insurers have to pay significant costs to build a branded product for a sub set of brokers on each software house, even if it is more or less a duplicate of their standard offering. Further costs are then incurred to maintain the separate versions of each product. Add to that the additional internal time and resource, and it is little wonder they are less keen to do so in such a competitive market where margins are narrow.

This has led to more focus on solutions like Insurer Hosted Pricing (IHP) where insurers can effectively make the changes themselves with less cost and delay straight into their core products, however more work needs to be done to progress this.

Market change

The most obvious example in the motor market in recent years is the changes on Ogden and the discount rate. This effectively threw insurer reserving and pricing into the air and all resource had to be diverted to deal with the change.

When considering other important, but distracting, factors like GDPR and IDD, it is unsurprising that the personal lines market sees relatively small amounts of bespoke offerings – it simply does not have the resource left to do it.

Strength in numbers

Our Insurer Partners have strong propositions and are committed to working with us to really focus on our Member’s businesses and reflect the value that they bring. Some of these insurers are long standing partners, and some of them will be new to our Members, as we know they want us to refresh the panel as the market changes.

Our partnership with Markerstudy is now up and running and we’ll be making announcements on new product offerings from Sabre and Midas as they roll out across the membership; so, expect to see lots of progress on our Personal Lines panel this year. ​

To find out more about the benefits of becoming a Broker Network Member, please get in touch by emailing info@brokernetwork.co.uk or calling 0344 346 0946.

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