A matter of opinion

Tony Lancaster, chairman and CEO of Groupama Insurances
1 Are you in favour of the Chartered Insurance Broker title?
Yes. This is a very positive development for the intermediary sector and one that can only be good news for the insurance industry as a whole.

Chartered status is well understood by the public and demonstrates the highest possible standards of expertise and professionalism.

2 Do you think the industry needs further regulation?
We should be under no illusions about the intention of the GISC to be an effective and rigorous regulator of the general insurance industry.

I believe that we were the first insurer member to receive a compliance visit from the GISC auditors. This lasted for in excess of four days and was extremely thorough at all levels throughout the UK group.

The GISC regime is not a soft option. It is already applying a stern test of compliance.
I have no doubt that over time this will be tightened and that the intention is to "raise the bar" continually.

3 What do you see as the biggest threat to broking in the future?
The statistics seem to suggest that the intermediary market remains in pretty rude health - at least for the moment.

However, there is clearly danger in resting on laurels here. There is definitely life in the direct writers yet and the good ones have clearly benefited greatly in the recent repositioning of rates in personal lines.

They also seem to be far better at containing their expenses and have the technology and innovation to respond quicker to change.

In a market where price is such an important element, I think this will mean tough times ahead for intermediaries specialising in this area and this may be accelerated further by the requirements of the GISC. I suspect that solvency requirements and succession problems may lead to further consolidation and numbers are likely to continue to fall.

We should also not forget the growing impact of what is termed the new competition, the power of brand and the likely effect of the internet and interactive TV.
I also think that reduction of choice caused by insurance company consolidation will remain of significant concern to the insurance broking community.

4 There are approximately 10,000 independent intermediaries in the UK. How many do you think will exist in ten years' time?
I suspect the numbers will reduce substantially. I have seen estimates that numbers will fall to well below 1,000 firms and, considering the speed of change, consolidation and the likely impact of regulation - this seems a reasonable figure.

Ken Wallace, intermediary business director of Norwich Union
1 Are you in favour of the Chartered Insurance Broker title?
It's not the title that is important but what it represents. It is demonstrating performance and technical standards, but it will have to be properly marketed with sufficient PR to ensure it is meaningful in so far as the public is concerned.

2 Do you think the industry requires further regulation?
I think we need to give the GISC a chance and ensure it is properly implemented. European legislation may demand more statutory regulation in the future and so there may not be a choice.

3 What do you see as the biggest threat to broking in the future?
Issues such as succession, internet, direct writers and reduced agencies are a threat to the broking community and I would add emerging markets. The most important aspect is that brokers themselves clearly understand market segmentation and only deal with those clients who fit their particular business model.

4 There are approximately 10,000 independent intermediaries in the UK. How many do you think will exist in ten years' time?
It is impossible to give a figure and the only guarantee would be that it would be wrong. There would definitely be fewer independent intermediaries and undoubtedly handling different types of insurance and more sophisticated customer propositions. I believe the overall number would be significantly down on the current level.

Andy Homer, chief executive of Axa Insurance
1 Are you in favour of the Chartered Insurance Broker title?
Yes.

2 Do you think the industry needs further legislation?
No. The GISC is sufficient.

3 What do you see as the biggest threat to broking in the future?
Broker consolidation.

4 There are about 10,000 independent intermediaries in the UK. How many do you think will exist in ten years' time?
There will be less than 1,000 brokers by 2006.

Dennis Mahoney, chairman and CEO of Aon
1 Are you in favour of the Chartered Insurance Broker title?
We would be in favour. For the rest of the profession the title "chartered insurance practitioner" was clumsy and failed to differentiate the role of brokers from other insurance professionals. The new title represents an improvement in the standing for the insurance broking professional, allowing those outside the profession to see the comparison with other chartered professionals.

2 Do you think the industry needs further regulation?
No, I don't believe so. We support the GISC model of regulation and believe the personal and commercial codes, coupled with the adoption of rule F42, should afford adequate and effective protection to the insurance buyer.

3 What do you see as the biggest threat to broking in the future?
From a London/international market perspective, I believe the biggest threat could come from not harnessing technology to improve the efficiency of processes within the market and to deliver a better level of service to clients.

4 There are approximately 10,000 independent intermediaries in the UK. How many do you think will exist in ten years' time?
5,000.

Andrew Torrance, general manager of Allianz Cornhill
1 Are you in favour of the Chartered Insurance Broker title?
Yes. The title will denote an enhanced level of professionalism, above and beyond what will be required by the GISC. It will also encourage people in the industry to develop themselves professionally, a concept that we at Allianz Cornhill have fully embraced with the launch of our new underwriting academy.

2 Do you think the industry needs further regulation?
No. Despite the Independent debacle, I do not believe the industry needs further regulation. What we do need is better identification of potential trouble spots, followed by focused regulatory action. This can be achieved within the existing framework.

3 What do you see as the biggest threat to broking in the future ?
So long as clients value their services, I see the role of the broker as assured. I therefore do not see succession planning or insurer consolidation as fundamental threats. Direct writers and infomediaries provide more fundamental challenges as they provide clients with a different offering. The challenge for brokers is to convince clients that what they offer is more attractive.

4 There are approximately 10,000 independent intermediaries in the UK. How many do you think will exist in ten years' time?
2,500 independent intermediaries, with a further 2,000 appointed agents.

Ken Carter, chief executive of Jardine Lloyd Thompson
1 Are you in favour of the Chartered Insurance Broker title?
Yes.

2 Do you think the industry requires further regulation?
Rather than further regulation, I believe better or a different focus of regulation for the UK general insurance industry is necessary. The relatively new GISC (of which we are a member) aspires to regulate all UK intermediaries to a common set of standards, but by doing so it should properly understand some of the practical difficulties that will be created for its members. For example, the over-protection of UK consumer interests can have a detrimental impact on the ability to transact and service commercial business, both here in the UK and overseas.

Effective regulation relies upon proper monitoring of compliance, with established rules and practice codes, and ensuring that sound and prudent management is in place. The right balance must be struck between more invasive auditing and self-certification.

3 What do you see as the biggest threat to broking in the future?
The lack of ability to adapt to the changing needs of the clients. In this regard we are taking advantage of the opportunities that a changing market and technology present to build on our present position in the industry. Notwithstanding change, successful broking will still be all about adding value for clients.

4 There are approximately 10,000 independent intermediaries in the UK. How many do you think will exist in ten years' time?

Due to reducing margins and changes in distribution, I would probably expect no more than 40% of the current intermediaries to still be in existence in the year 2011

Mary Francis, director general of the Association of British Insurers
1 Are you in favour of the Chartered Insurance Broker title?
Professional qualifications are always valuable. For intermediaries, a title like this shows their clients they have invested time and effort in attaining high standards of knowledge and expertise.

2 Do you think the industry needs further regulation?
No. The selling of general insurance is now well regulated. More red tape would bring extra costs for consumers. The last thing we need, as we move over to the new GISC regime, is to add further administrative layers.

3 What do you see as the biggest threat to broking in the future?
Change brings with it opportunities as well as threats. There will always be a role for the high levels of service provided by intermediaries, and it's down to individual firms to make sure that they are flexible and adaptable enough to innovate and compete with new developments in the market. Even in personal lines business, for example, where the direct writers - and now, increasingly, the internet - have made strong inroads, there is enormous scope for intermediaries to add value.

4 There are approximately 10,000 independent intermediaries in the UK. How many do you think will exist in ten years' time?
We'd put the total number at nearer 5,000 now. In ten years' time, the broader industry trend for consolidation may have had an impact on this sector, too. But the firms that are successful over the long term will be the ones that adapt to take advantage of new technology and changes in the market, and use them to offer the best possible service to clients. And that's as true for the one-man bands as it is for the huge corporations.

Paul Spencer, UK chief executive of Royal & Sunalliance
1 Are you in favour of the Chartered Insurance Broker title?
In full support. We need a more professional and highly trained industry interfacing with the client and this would provide a good benchmark.

2 Do you think the industry needs further regulation?
The industry as a whole is already heavily regulated. The GISC is a further example of how we should be able to show that we can regulate ourselves in keeping the protection of the policyholders' interests at heart.

3 What do you see as the biggest threat to broking in the future?
The GISC has already contributed to a major reduction in company agency bases .Larger brokers are growing by acquisition, particularly in the personal lines market. Brokers need to be re-evaluating what they are offering when the customer has so much choice.

4 There are approximately 10,000 independent intermediaries in the UK. How many do you think will exist in ten years' time?
Fewer than 1,000 intermediaries, but still servicing broadly the same share of the total market.

Paul Asplin, managing director of DAS
1 Are you in favour of the Chartered Insurance Broker title?
I am very supportive of the role that the CII plays in raising standards within the insurance industry and, in particular, promoting the need for individual training and qualifications. I feel that the new Chartered Insurance Broker title is a further positive development and sits well alongside the Chartered Insurer title that has been available for some time. Just like other professionals, I think it important that brokers have the opportunity of demonstrating individual professionalism.

2 Do you think the industry needs further legislation?
More and more regulation is probably no answer to any problem. For the broking profession, the real changes will now be brought about by the GISC. If the GISC works properly, then further regulation is probably not required. However, it must be obvious that, if for any reason GISC fails, then the government will probably have little option but to regulate the activities of all insurance intermediaries. For this, and many other reasons, I would have thought that intermediaries would do well to support and embrace the GISC.

3 What do you see as the biggest threat to broking in the future?
It is my view that for the foreseeable future brokers will have an important role to play in insurance. Brokers continue to dominate the commercial market and provide good solutions for millions of customers in personal lines as well. Of course, direct writers, the internet and so on are always a threat, but brokers have already responded well to these. It seems clear, however, that there will be continued consolidation in the broking market. The GISC will prove to be a catalyst for this as many smaller brokers will simply choose to leave the market, as compliance may not be economically viable.
However, taking all the factors into account, I believe that the most important reason for a reduction in future broking numbers will be the insurers themselves deciding that they require fewer independent intermediary agencies. This may arise because of consolidation among insurers, or simply a decision that fewer independent intermediary agencies are required.

4 There are about 10,000 independent intermediaries in the UK. How many do you think will exist in ten years' time?

I am sure that there will not be 10,000 independent intermediaries in the UK in ten years' time. Clearly, there is already a significant trend towards a reduction in numbers and, although I suspect that we will continue to see new specialist brokers emerging, I would have to assume that over a ten-year period the number of independent intermediaries will fall to at least half of the current total and possibly as low as 25%. This does not, however, necessarily mean that the volumes of business controlled by independent intermediaries will fall in the same proportion - indeed, I would be very surprised if this were to happen.

George Nixon, chairman of the British Insurance Brokers' Association
1 Are you in favour of the Chartered Insurance Broker title?
I am very much in favour of the Chartered Insurance Broker title. Chartered titles carry credibility and are recognised by the public generally as professional qualifications. Under past regulation in the IBRC regime, it was possible for an individual to register and carry the title "registered insurance broker" but this had no profile with the public. Attempts to establish a replacement register by self-appointed registrars have no credibility or value. The Chartered Insurance Broker title, earned by examination and awarded by the Chartered Insurance Institute, is the way forward for individuals.

2 Do you think the industry needs further regulation?
I am in favour of good regulation, provided that it is applied consistently and sensibly.
I think that the most important issue at present is to get existing regulation to work well, rather than introduce more. The FSA is getting a lot of criticism for its failure to foresee the Independent problem. I doubt that more regulation is needed, as the FSA probably has enough powers - it is more likely to be a question of the way that they apply those powers and the quality of the resources at their disposal to carry out the task. When fully implemented with rule F42 in place, the GISC will be a major improvement in the regulation of general insurance.

3 What do you see as the biggest threat to broking in the future?
I believe that brokers have terrific opportunities to prosper in the future. Clients in general are more sophisticated than ever in their buying behaviours and require high quality, professional advice.
The internet and other technological developments, correctly applied, enable brokers to enhance their service to clients. There are many challenges facing brokers, but that is not exclusive to brokers and is the case for any profession or industrial sector.

The biggest threat to the future of any broking firm is its own failure to understand the challenges, to change their own business model and to focus clearly on its business objectives and on the value that it adds to the clients in its chosen market sectors.

4 There are approximately 10,000 independent intermediaries in the UK. How many do you think will exist in ten years' time?
Some consolidation is inevitable as GISC regulation, backed by rule F42, will shake out those that cannot meet the required standards. There will also be mergers and takeovers but this activity often spawns new ventures as well as eliminating old ones. I would not want to guess at a number in ten years' time, but I do not agree with those that envisage there being only 500 in three years' time. I would expect there still to be thousands rather than hundreds in that timescale.