’We’re thrilled to see so many startup brokers flourishing under our model,’ says managing director
The Movo Partnership managing director Lee Cheesbrough has said “startup brokers have boomed” in 2023 amid an increase in the appointed representative (AR) network’s members.
In a statement released today (20 July 2023), Movo said a further 28 insurance brokers have so far signed to the network this year, with 18 being start-ups (64%).
This compared to a total of 40% in 2022.
Movo added that it had also launched 12 startup brokers in the last six months.
“Startup brokers have boomed in 2023, partly due to fallout from the recent M&A frenzy, but also because of a shift in regulation,” Cheesbrough said.
”The FCA has effectively rubber stamped the AR model and that’s had a dramatic impact.”
The FCA confirmed new rules to make firms more responsible for their ARs last year (8 August 2022).
As part of these new rules, regulated businesses are required to action enhanced oversight of their ARs – including ensuring that they have adequate systems, controls and resources – and must provide complaints and revenue information for each AR to the FCA via annual reports.
”When you consider that it takes just 12 weeks to get authorised as an AR compared to 12 months as a DA broker, not to mention that it’s around 70% cheaper, removes the compliance and regulatory burden and guarantees you an agency from day one, it’s little wonder that start-ups under the AR model has proven to be so attractive,” Cheesbrough added.
Movo is an alliance of independent brokerages operating under an AR regulatory framework.
It revealed that it now had 85 members signed, surpassing its year-end targets six months ahead of schedule.
The network now expects to hit 120 members and £100m gross written premium (GWP) by 2024, with 60% of those members being start-ups.
“Brokers are like trees – plant a seedling, nurture and support it, and branch by branch, wait for it to grow,” Cheesbrough said.
”The sub £2m GWP start up brokers are our heartland and our mission at Movo – to grow and protect the future of independent broking in the UK.
”The Movo Partnership exists to be the most cost-effective way to run a brokerage and to encourage new start up brokers, replacing the brokerages in the market that have been lost to M&A activity.
”We’re thrilled to see so many startup brokers flourishing under our model.”