We bring you the full story behind the long-awaited Provident acquisition, and expose endemic corruption in emerging countries
The motor market is the one to watch this summer. Riding high on the back of price hikes, the market is buzzing with renewed energy, and everyone wants to get in on the act. Witness Covea’s long-anticipated acquisition of Provident, finally completed this week, and Zurich’s plans to return to the road in the second half of this year. With RBSI also on the growth trail, it’s going to be a bunfight.
Which is why distribution is so key to growth in this market. Over at Ageas, fresh from the acquisition of Castle Cover and Kwik-Fit, chief executive Barry Smith would no doubt agree that, in a business where profit margins are often just a hair’s breadth, the combination of manufacturing and distribution is the key to a winning formula. Small wonder then that Covea, which already owns broker Swinton, saw an opportunity.
• Wake up and smell the coffee, justice ministers. It’s all very well sitting in an ivory tower and decreeing that no money should change hands off the books, but as IT Investigates reveals this week, the reality of doing business overseas is very different. In brutal terms, if brokers want to set up shop in countries such as Russia, they have to grease a few palms. We can flinch all we like, but it’s how business is done there. Under the Bribery Act, this means brokers are technically forced to break the law if they wish to open up in these jurisdictions – and under the new guidance, directors could face jail for doing so. It’s a risky business. Perhaps staying home in the UK and western Europe is looking a little more attractive now?
• Some welcome news this week: the FSCS levy is not going to be quite as high as anticipated, because PPI claims haven’t reached quite the predicted peak. Well, not yet anyway. Only full reform of the system will protect brokers – and Insurance Times will keep running the Fair Fees campaign to demand it. Sign our petition at insurancetimes.co.uk/backfairfees.