Axa has cut commission levels on employers' liability and road risks insurance.
The base level of commission will be cut to 7.5% from May 1. Axa said this was a result of poor underwriting experience, which had increased pressure on expenses.
But Axa's commercial and intermediary lines director, Mark Cliff, claimed that with inflation gradually pushing premium rates up, the effect of the reduced commission would be mitigated by increased premium income.
But one broker, Jenner Baldock, reacted angrily to the decision, saying: “Does this man not realise that inflation also pushes up the overheads of running a brokerage, in wages, computer running costs, postage, stationery and every other consumable?
“There is not a great deal of competition for this type of business between insurance companies and Lloyd's syndicates, and it should not be difficult for them to price the risk properly without slitting the throats of their supporting brokers.”