With reference to the letter by L. Tucker of Cornwall ("Errors means brokers' quotations are beaten," 28/10/99), we totally agree that with today's technology, companies should be able to keep claims data which can be accessed by other insurers. But we wonder in the current climate whether insurance companies are at all interested.
Recently we submitted a quotation to Axa Insurance Company in Glasgow. This case, which was held by us, was also sent in by another broker, but the client only disclosed two claims in the last five years when there were in fact two further incidents in the previous twelve months representing some 60% of the premium income.
These were deliberately missed out by the client and although we brought this to the attention of Axa, they still accepted the risk at normal terms. This has only encouraged the client to withhold information with other policies and has now formed the opinion that claims experience is irrelevant.
It is sad to see the state the insurance industry has got into and we wonder if there is a place for the honest client and broker when a simple "moment of forgetfulness", deliberate or not, can save the client a lot of money and also lose business for the broker. Much of the blame must go to the company for supporting the company's clients.
DB Alison and Partners
Dangers of Screentrade
I, and hundreds of other Misys users, have no enthusiasm for the success of Screentrade (Insurance Times "Interactive broker sites could rewrite the future of the industry", 18/11/99).
For more than ten years we have been obliged to pay excessive charges to Misys and have, for all practical purposes, been locked into agreements for supplies and services on which we are now totally dependent. Now, it is clear that these charges were not re-invested in developing "the system", as we were told, but used to develop Screentrade. We were being overcharged in order to finance the introduction of a threat to our very existence.
I also understand that when the users formed Countrywide it was to enable the high street broker to compete with the new entrants in the marketplace but clearly when Misys bought up Countrywide, it was not quite as they stated, to enable them to develop EDI products, but rather to provide a launch platform for Screentrade.
I also remember hearing their chief executive, when addressing a user group meeting, clearly state that it was the Misys promise not to take investment from an insurance company in order to retain their complete independence, and later, when they bought up a local brokerage, it was simply to give them a better understanding of a broker's needs. How true.
Will they now sell the software to a bank or a supermarket chain? Or will they launch their own insurance company to underwrite the Countrywide account?
Or will they perhaps share the profits of Screentrade with those of us who have struggled to finance its development? It could help supplement our dole money until state pensions can be drawn
They could at least waive the £600 plus annual membership fee to remain members of Countrywide. The time is long overdue for an enquiry at government level into the activities of these monopolisic software houses before it is too late for the independent intermediary and for customer choice.
Name and address with editor
Folgate still in motor market
The article in the November 18 edition of Insurance Times, "Folgate to axe 30 personal lines staff in cost-cutting move", needs clarification.
As in any prudent organisation, Folgate Insurance is undertaking a review of its operations. This is to ensure Folgate is structured to meet the needs of a changing market, particularly in light of the increased use of technology. One of the review's objectives is to increase the standard of service to our broker and intermediary partners. As a broker-only insurer, we recognise that we will achieve our corporate objectives only if our service's quality matches the competitiveness of our products.
Folgate is also embarking on a radical realignment of its business mix; this has operational implications too. As your article mentions, from next year, we intend to expand our commercial lines business. Currently, we are a predominantly personal lines insurer and, to expand our commercial lines business, it is necessary to recruit externally where existing internal experience is not available. Therefore, it is necessary to realign our staffing levels between our personal lines and new commercial lines divisions. Regrettably, this means that a number of existing positions will no longer feature in our restructured business.
Your article also refers to Folgate withdrawing from the motor market two years ago. In fact Folgate has continued to write motor business (which currently accounts for around 15% of our total business) for brokers in Northern Ireland and for selected scheme and affinity brokers.
To ensure brokers continue to be represented by companies like Folgate, it is essential that we continue to adapt our business to ensure we continue to remain competitive and meet the needs of brokers.
It's time to end the in-fighting
With regard to your article of 11/11/99, "Insurance companies are more popular than brokers", the responses to the research can hardly have been of any surprise.
Considering the amount of money that is spent by insurance companies, banks and building societies on advertising, I am amazed they do not have even greater penetration.
What, if anything your article shows is that insurance brokers collectively should be letting the public know what wonderful value we offer, rather than the continual in-fighting between IIB, ISC and the myriad of predecessors. Perhaps we should be concentrating our efforts in this area.
Take your head out of the sand
Congratulations on bringing to the fore this important matter (Insurance Times, "IBRC moves closer to mass expulsions", 18/11/99). Brokers must put their houses in order in readiness for the GISC who have, however, admitted that their target date for admissions (February 2000) is unlikely to be achieved. Grandfathering will not be available to firms who have been expelled for breaches of their statutory duty as to do so will reflect badly on the perceived intentions of the GISC to present a well-regulated regulatory body.
I recommend everyone involved in insurance to get a copy of the consultation document and write to the GISC with your views. The rule book is not yet written and minds are not yet closed, but if you put your heads in the sand don't be surprised if you get a kick up the **** when the GISC becomes functional.
Anthony Hall ACII
Internet not the end of jobs
On 11/11/99 you published an anonymous letter which claimed that the internet will result in redundancies, due to it replacing personal contact.
The internet doesn't replace personal relationships. It adds value to them in the same way that telephones and fax machines are now essential business tools, because they give clients more ways to get in touch with you.
The real difference is that, on the internet, size isn't important. The internet world is a fast-moving place, and because smaller brokers tend to be more nimble, they can adapt to this new world quicker than their larger counterparts.
Far from being the end of small brokers, the internet could actually be the making of them – at least of those small brokers who realise the potential of this revolutionary technology.
I accept that the internet will result in job losses in certain areas. It doesn't take a genius to figure out that if you've realised you're starting to lose clients to the internet you need to either embrace this new technology or suffer the consequences.