As MMA joins the other big insurers backing with the aggregator model this year, is there any way to lessen the pain for brokers?
Here we go again.
MMA, backed by wealthy French parent Covea, plans to launch an aggregator with £20m marketing backing.
Yes, it makes good business sense, as Swinton, Provident and MMA can gobble up market share on their own aggregator, while also attaining all sorts of valuable information about how the model works.
But it will be disappointing that a broker-only insurer group is effectively sleeping with what many brokers view as the enemy.
That means that Aviva, Zurich (both of whom are returning to price comparison sites) and MMA Group are all this year stepping up their commitments to the aggregator model.
More market share will slip away from brokers, many of whom lost volume in personal lines motor to last year’s huge rate rises.
A soothing balm to brokers’ wounds would be the introduction of ‘best pricing’, the concept of narrowing the price difference between broker and direct as much as possible.
Aviva successfully introduced this strategy last year. Another insurer joining in would be warmly welcomed.
Zurich consolidation talk
There are more rumours of insurance consolidation, this time in the form of talk of Zurich offering £17.2bn to buy Aviva.
It’s a long shot, as Zurich, which is in the middle of its Solvency II preparations, would probably need a rights issue to generate the cash.
But what it does show is that there is expectation in the City of consolidation at some point in the UK insurance market.
Once Solvency II is out the way in a year or so, expect to see more talk of insurance takeovers.
Insurance consolidation has been a long time coming.
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