The Covid-19 pandemic will not derail GRP’s business strategy, group managing director Mike Bruce insisted to Insurance Times.

He revealed that, while some sectors will clearly be hard-hit, the crisis could also create opportunities.

Bruce said that while some businesses would want to hunker down as the coronavirus crisis plays out, others could see it as ”an opportunity to do a disposal before any negative waves start going through the business”.

There will be “no slowing down” of the firm’s M&A strategy, which has already seen acquisitions this year, including that of Manor Insurance Services by hub broker Greens just days before the coronavirus lockdown was announced. 

Despite Manor’s large book of travel business - a sector that has been particularly badly hit by the Covid-19 outbreak - Bruce said that GRP is always careful in terms of its due diligence before making acquisitions, pointing out that “business mix” is a factor when looking to buy.

Certainty

Bruce said GRP is in a good place despite the escalating crisis, due largely to its backing from private equity firm Penta Capital as well as the impending investment from Searchlight, which is awaiting regulatory approval.

Being part of a bigger organisation in times like this can be a safe haven for many people, he pointed out. ”We bring certainty of execution, given the financial backers we have and their commitment to the market.” 

But Bruce - who is set to become group chief executive once the Searchlight deal goes through - admitted that the impact of Covid-19 was hard to predict at this stage.

”We’re probably in a similar situation as many other brokers. The impact of companies getting into financial difficulty hasn’t come through yet.”

Some sectors could bounce back quicker than others, with areas such as leisure and hotels being particularly exposed right now, he added.

”I tend to try and see the positives. We have gone from virtually no one working from home to all of our 1,600 employees working from home within two and a half weeks.

”We need to think about how we run our business and how we interact with customers.

”The crisis has forced us to think differently and be more innovative. We can be more efficient and agile in terms of how we engage with our customers than we were before.” 

No virus impact - yet

Bruce continued: “I imagine a lot of March renewals were already in the market getting processed before this happened. We, and many of our peers, had a strong month with no virus impact whatsoever.

”We just have to make sure we’re supportive as possible to customers in their hour of need so when we come through this they’re still there and we’re still there acting as their broker.”

Coronavirus notwithstanding, the broking group has a clear and “boring” strategy, which Bruce aims to continue when he takes up his new role.

”M&A is a key part of what we do. Then when we buy a business, we have a proven ability to grow it organically. We aren’t planning on changing that twin-track approach,” he said.

”Our plan is essentially ‘more of the same’.”

Huge opportunities

Bruce said there are still ”huge opportunities” within the UK broking segment.

”We’ve built our network of hub businesses who are in turn tasked with completing small bolt-ons to build local connectivity in the market,” Bruce explained.

That part of the strategy will continue, he said, while GRP has also invested on the underwriting side with the acquisition of several MGAs. This method will also continue.

The other strand of GRP’s approach is wholesale broking through its Lloyd’s business Lonmar. There he sees growth coming from strategic hires rather than through acquisitions.

”Each business has a clear plan for growth. We’ll continue to do the things we’ve been doing very well for the last three to four years.

”On one level this sounds dull, but we’re in a nice position because we’re not reliant on doing one huge headline acquisition or on any big technology change,” he said.

Nevertheless, there are still areas where the business could improve, Bruce admitted. ”We aren’t complacent. We’re the most restless management team I’ve ever been part of in terms of questioning what we’ve done and looking to do better.”

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