Large regional brokers and niche firms seen as best-placed to survive the recession
Brokers remain upbeat despite the recession, according to a survey by insurer MMA.
More than two-thirds of brokers who attended MMA’s recent series of broker roadshows said they felt their business had fared better than they expected during the recession.
Fifty-eight per cent said they thought the insurance sector would emerge stronger from the recession, compared to 18% who thought it would be weaker. Sixty-one per cent did not see any signs of economic recovery yet, while 27% did.
When asked which types of brokers were best positioned to survive the recession, the most popular answers were smaller commercial brokers and large regionals. Specialist and niche firms were also singled out as most likely to fare better in the tough conditions.
There was support for rate hardening, provided insurers work with brokers on this. Twenty-nine per cent of brokers believed that premium rates are already hardening, while 36% said they were not. Among those who did believe rates are hardening, motor fleet, motor trade and liability were the most commonly cited classes to be benefiting from this hardening.
Brokers also felt that if rates failed to harden this year, the impact on the market would be significant, triggering loss of revenue, preventing growth, and having a detrimental effect on staff morale and retention.
MMA commercial director Derek Plummer said: “Overall, the mood of brokers we met around the country was more upbeat than we might have expected. When the dust finally settles on this unstable economic period, we may well see a much more robust insurance broking sector emerging, particularly with the local independents.”