As its restructure brings a return to comparison sites, can Zurich convince the market it knows what it's doing? Meanwhile, the RSA pecking order has its own reshuffle
This lunchtime, Zurich announced that it is returning to the aggregators.
Under today’s announcement, which involves 149 job cuts across the Swiss insurer’s UK operations, Zurich will offer motor and home insurance on comparison sites. Endsleigh, which increasingly looks like Zurich’s web-based arm, will take over direct sales and service.
The return to the aggregators is the latest in a string of announcements from Zurich, kickstarted by last December’s shake-up of the companys UK GI management structure
It‘s probably too early to judge, but this restructuring has not so far translated into improved performance. Zurich UK’s GI operating profit was down 16.7% in the first quarter of this year compared to the same period last year from $48 (£30m) to $40m, including an underwriting loss of $8m. These results followed Zurich’s decision to scale back its exposure to unprofitable motor business last year.
Brokers’ diminished faith in the company was reflected by its slippage from 11th to 24th in last year’s Insurance Times Broker Service Survey.
Today’s announcement, coming so soon after the company’s withdrawal from the aggregators last year, smacks of a certain amount of indecision within Zurich.
Karl Bedlow, who was handed control of Zurich’s personal lines and direct business as part of December’s restructure, said today that the company’s “total commitment to the broker market ... remains a fundamental priority. To underline the point, he reassured the company’s intermediary partners that Zurich’s “commitment to personal lines brokers won’t be affected by this development”.
But out in broker land, there will be some raised eyebrows.
Brown edges ahead
Adrian Brown’s elevation to the RSA group board is a feather in the cap for the company’s UK executive director.
Brown’s appointment will be seen as deserved recognition for his hand in turning around RSA’s UK operations, which had a reputation as a basketcase less than a decade ago.
It also means that he is back ahead in the RSA pecking order of his erstwhile commercial managing director Paul Donaldson, who won a seat on the group executive committee following his May promotion to a worldwide role.
FSCS claims trebled
And the payment protection insurance scandal is finally crystallising in the form of cold hard cash, the Financial Services Compensation Schemes annual report shows. Figure buried away in the report show that the volume of claims to the FSCS has more than trebled over the last year.
What will be most galling for brokers is that just 102 of the claims related to non-PPI complaints – one more than last year.
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