Post Office Management Services will initially handle travel insurance but could expand to other products
The Post Office has brought some of its broking activity in-house following the creation of a new business entity, Post Office Management Services (POMS), which will place travel insurance directly with an insurer.
This move means the Post Office will no longer use Aon to place travel insurance policies in its name.
Both companies came to a mutual agreement to end their travel insurance partnership when their contract came to an end at the end of 2014.
Capacity for POMS will be provided initially by insurer Great Lakes, a subsidiary of Munich Re.
Post Office head of insurance and POMs general manager Paul Havenhand told Insurance Times the business was in talks with other insurers about providing additional capacity.
Havenhand said the move had been driven by the company’s commitment to give policyholders a more consistent customer journey. It will also enable the company to create and own its own products.
He added: “We want to create an operational environment that will enable customers to have one point of contact as opposed to having different businesses to contact.
“The structure we are putting in place means we will have multiple underwriters by the end of this year. We own the product design and structure. We can go to market and ask underwriters to write products on our behalf.”
The broker has created 75 additional jobs in an existing call centre in Glasgow to handle its sales, customer services and complaints.
POMs is also planning to hire up to 25 people by the end of the year to support the growth of its Post Office travel insurance book and other new business.
Home and motor insurance are among the other types of cover that are sold under the Post Office brand.
Havenhand said the new business model gave the company the capability to place insurance in house for other products.
“We have existing contracts with suppliers who provide us with broking and administration services,” he added.
“Whilst those suppliers are adding value and there is a fair apportionment of value to those businesses, there is an opportunity for them to still be involved.”
POMS chief executive Nick Kennett added: “This is a big step for Post Office Travel Insurance as we create a new business, Post Office Management Services, to provide our new travel insurance products.