Insurance brokers believe that changing distribution trends present them with both their biggest challenge and their greatest opportunity, new research reveals.
The research, What British Insurance Brokers Think, shows that new distribution trends such as direct writers, the internet, and the creation of �Super-brokers� through the acquisition of firms are the big issues facing UK brokers.
Published today, the research was commissioned by leading, specialist insurance market Lloyd�s and conducted with the British Insurance Brokers� Association (BIBA). It surveys a range of brokers� opinions on current opportunities and challenges within the UK industry.
It also found that more than 80% of brokers believe that maintaining profit throughout the insurance cycle is still the greatest challenge for the insurance industry on the whole.
Other key findings include:
brokers are spending more of their time dealing with increased regulation and becoming more internet-savvy. Almost 90% of those questioned said that they were actively addressing increased regulation, and three quarters were dealing with the challenges posed by the internet;
more than three quarters of those questioned said that the growth of �Super-brokers� was the factor most likely to change the UK broker market in the next 18 months; and
brokers feel that they have adequately addressed the key issues of client money, contract certainty, and conflict management, although they feel more work needs to be done.
Julian James, Director, Worldwide Markets at Lloyd�s, said:
�This research gives a clear indication that, to be successful, brokers need to tackle the challenges of changing distribution trends and embrace the opportunities they present. It also shows, quite rightly, that maintaining profitability throughout the insurance cycle remains a key industry challenge.
�At Lloyd�s, we work closely with brokers, BIBA, and the London Market Insurance Brokers� Committee to address these issues, while the market�s strategic plan aims to ensure that Lloyd�s remains the platform of choice throughout the insurance cycle.�
Eric Galbraith, BIBA Chief Executive, said:
�This survey confirms that the broking and intermediary channel is responsive to change, recognises the challenges and opportunities that exist and continues to be innovative. The impact of the market cycle on intermediaries and their customers, consolidation and other changes in distribution, regulation and technology all provide continuous challenges and opportunities.�
The full research report can be seen at: www.lloyds.com/research It was carried out among UK brokers earlier this year at the BIBA conference, Making a Difference.
BIBA � the British Insurance Brokers’ Association � is the UK�s leading general insurance organisation. It represents the interests of insurance brokers, intermediaries and customers, and has partner members from leading companies in the insurance industry.
There are currently 163 accredited Lloyd�s brokers. Brokers bring business to the Lloyd�s market, taking a particular risk they want covered around the market to try to find the best price, terms and conditions.
The research was carried out by Acritas Research Ltd. It involved 117 impromptu interviews with UK brokers at the BIBA 2006 conference.
The LMBC is a trade body, representing the interests of Lloyd�s brokers operating in the London and worldwide insurance and reinsurance markets. Its members are responsible for handling in excess of �25bn of premiums through the London Market and many billions more across the World. They generate some �2bn of invisible earnings to the UK economy each year./p>