Stuart Reid speaks out as the insurer-owned broker celebrates 18 months and prepares for a rebrand.
In thinking what to write, I took time to reflect on what has been an outstanding first 18 months for our company, particularly for those who work within Venture Preference (VP). Each came from a fiercely independent business and most from a sizeable consolidator. For any of us to have been bought by an insurer, especially to be one of the first to have been bought in such a way in the UK, was a monumental change.
With rapid growth, even by acquisition, retention of staff and clients remains of paramount importance. It has therefore been extremely important that the messages we give both internally and externally are simple, straightforward and followed. This we have done and our success in this area is a testimony to those who work within VP, and shows that the independent message has been received and proved, despite the cynics that abound and who shout very loudly.
Difficult decisions have to be made in any business and, in particular, in a company that has so rapidly brought other independent businesses together. Ensuring that overall management lines are simplified and easy to understand by all was a key early priority and has promoted a feeling of security for all.
Communication has also been vital and, having personally visited over 50 branches in the past three months, has meant that I for one feel that I have as comprehensive an overview of the business as I can, something we all felt was imperative before any future plans could be considered.
One result of these travels has been developing an understanding of how diverse a business VP has become, and realising that a ‘one size fits all’ approach is not necessarily the best way forward. Certainly, the geographic footprint, achieved in the main by the purchase of Smart & Cook, is something that we realise is a powerful strength, and we are very proud of the mantra we use, “National voice, local accent”.
Insurers have been extremely supportive, after some initial shock, with all of them at least giving us the opportunity to prove what we said at the outset about our independence. Eighteen months on I am happy to report that we have done exactly as we said we would.
Much remains to be done. Integration activity within the business will increase, not least the launch of the long awaited brand. Acquisitions will continue. Competition will change as other insurers continue to acquire and the smaller consolidators attempt to buy each other before their money is restricted.
“Difficult decisions have to be made in any business and, in particular, in a company that has so rapidly brought other independent businesses together.
We will continue to invest in our network and franchise offering as new brokers appear, and the smaller ones can benefit from the buying capacity and service levels of the large.
The FSA may cause massive consternation with its review of commission disclosure. It should not be under-estimated quite what a threat any changes may mean to all that we do. Despite some cynics’ comments it is not simply a fear that commission will go down. Disclosure undermines the very way our business works and will increase cost for the consumer (yes it will!).
At these times of rising costs for us all, I find it somewhat strange that the FSA feels the necessity to embark on this issue, yet again, when ultimately it is the consumer who will pay. Insurers find it difficult to cope with service issues now: how bad might it be if, with a broker competing on commission, it feels it can no longer issue insurers’ documentation or settle/deal with claims?
So the future has challenges, not least guessing when rates might go up. However, as always our industry remains dynamic and exciting – who ever said insurance was boring?
Stuart Reid is chief executive of Venture Preference.