Giles’s Brendan McManus should know better than most that insurance is about the numbers
Everyone loves a cliché, and ‘insurance is a people business’ is up there with the best of them. But as the stagnant economy lingers on and businesses have no choice but to focus on the bottom line, is it really true? Sure, deals are done over dinner and a handshake, and personal relationships are key to the insurer-broker dynamic – but that’s only the beginning of the story.
Take Brendan McManus, interviewed this week. Yes, he goes into Giles with a lot of goodwill from the market. That will open doors, and win him the ear of any insurer boss he wants. But what then? As a former underwriter himself, McManus will know that the power of personality can only go so far. So it’s interesting to see that, under his auspices, Giles is pulling together the numbers on its ROI over the past five years, ready to have some serious,evidence-based conversations with insurers.
How those conversations go will depend on what McManus’s numbers show, and what he’s able to promise and prove. The underwriter-turned-broker approach is more traditionally associated with Towergate, and is arguably the key reason behind the larger consolidator’s success.
As the row between Aviva and Broker Network showed a few weeks back, any deal can fall apart if either side starts to feel that the numbers don’t add up. You’ll have heard this one before, but insurers are once again looking at broker commissions, especially among the consolidators, and asking: are they value for money?
Numbers dictate in the M&A world too, where for all the speculation about a ‘consolidation of the consolidators’, there’s one simple truth: it ain’t going tohappen until the finance is available and the numbers add up.
Because, when it comes to the crunch, insurance is a numbers business.