In response to Andy Homer's letter (1 May, Insurance Times). How can we, particularly as commercial insurance brokers, be upbeat about insurance when talking to family, friends and business associates ...

In response to Andy Homer's letter (1 May, Insurance Times). How can we, particularly as commercial insurance brokers, be upbeat about insurance when talking to family, friends and business associates? We all know that businesses have benefited from under-priced insurance cover for a number of years, but this has proved to be a false economy when they are faced with the level of increases that insurers now demand, if indeed they can obtain cover at all.

We are constantly asked: How can businesses budget for the future? Will my company be forced out of business if even the most basic and statutory covers cannot be obtained? How can insurers justify asking for excessive premiums? What has happened to loyalty on the part of insurers when customers have been with them for many years, often claim-free?

Obviously, we appreciate that premiums have to be increased, but who was it that kept them at the unsustainable levels of the past ten years? Certainly not brokers or customers. Yes, businesses did seek ever lower premiums and brokers played their part in moving clients for the best deal, but it was the insurers who set the rates.

Perhaps the current crisis will stick in the minds of insurers and the market will not soften as dramatically as it did in the past, but I very much doubt it if investment returns start to pick up and extra capacity becomes available.