Norwich Union (NU) is set to sell insurance to small businesses direct over the internet.
Tim Rolfe, NU's director of distribution development, explained that a test would start next month selling four products: self-employed products, professional indemnity, residential buildings and office packages.
He explained that the cover would be available as a click-through on NU's website and that it would be priced to match NU's offerings through brokers.
He added that any unfulfilled inquiries on the website would be diverted to local brokers.
Rolfe said that the move was designed to match the expectations of customers. "Our research discovered lots of people surfing the web after hours, looking for insurance for their businesses," he said.
"Throughout the test group, 65% of all commercial insurance inquiries took place outside of normal business hours," Rolfe added.
The move echoes that of Royal & SunAlliance (R&SA), which started selling insurance for small businesses (with turnover less than £1m) through its More Th>n site in January 2004. Both AXA and Zurich sell insurance direct to businesses. The AXA Direct business, based on a regional sales force, is reputed to be one of the best performing parts of the AXA business worldwide.
Last month, Datamonitor revealed that 56% of small and medium sized enterprises would buy their insurance direct. And a senior insurance company manager added that his company's own research revealed that more than 20% of businesses would like to buy their commercial insurance direct.
In response to broker concerns, NU argued that the service was aimed at very simple cases with premiums in the low hundreds of pounds. Rolfe argued that the traditional segregation between commercial and personal lines was turning into a segregation between advised and non-advised cover.
"Brokers add more value by concentrating their efforts on clients who require bespoke cover," he added. "After all, we sold the Hill House Hammond business back into the broking community," said Rolfe.
"If the demand for e-trading is there it will only affect a minority of business," he added.