Towergate chairman Cullum encourages expenses transparency for direct insurers
Broker commission transparency will become “in-evitable” in the UK insurance market, but direct insurers must disclose their expenses, Towergate Partnership chairman Peter Cullum said this week.
Speaking at a panel discussion at the Biba conference, Cullum said Towergate believed mandatory commission disclosure would be introduced into the market.
But he insisted that full transparency was needed across the industry and called on direct writers to disclose their marketing spend to make it a level playing field for all companies.
He said: “[Broker commission transparency] will be inevitable and will happen over time. Insurers should also be transparent with their expenses as there are huge inefficiencies with expenses.”
His comments came as the panel, which also included AIG president Martin Sullivan, Dennis Mahoney, chairman of Aon Global, and Lloyd’s chief executive, Richard Ward, faced questions about the future of the insurance market.
The panel warned that insurers would lose business to the capital markets if they failed to drive out operational inefficiencies and respond to customer demand.
Mahoney said: “Capital markets are more volatile but they are deeper and more liquid. They are a threat to insurers who need to get rid of their inefficiencies.”
Cullum added: “Insurer’s expenses are still too high. They need to change their models.”