Broker Network chief tells insurers to reduce admin costs.

Broker Network chief executive Grant Ellis has called on insurers to reduce the overall cost of distribution before slashing brokers’ commissions.

Ellis was responding to insurers that have declared they will fight against consolidators demanding increased commissions.

Aviva-owned Norwich Union has said it would rather lose business than pay sky-high commissions to the consolidators.

Ellis added that the commercial market was in desperate need of more efficient processes.

He said that commercial insurance had not moved on in over 30 years, unlike the personal lines markets, which had seen costs fall significantly.

“If brokers were making excessive profits that would be a fair and reasonable thing to say. I don’t see brokers making excessive profits anywhere and I think it would be much better to look at the overall costs of distribution,” he said

Ellis urged insurers to address their own fundamental failings in relation to administration.

Meanwhile, Broker Network has announced that its Associate membership scheme has signed up 23 brokers, with a further 20 applications expected within the next six weeks.