Cardiff is a city with much to boast about. Yvette Essen visits broker Thomas Carroll which has a red dragon in its logo and a patriotic clientele that keeps the business firmly rooted in Wales

The Welsh are so patriotic they use their red dragon symbol at any given opportunity.

Thomas Carroll fits that description. As Wales' largest independent commercial insurance broker it proudly boasts a red fiery monster as part of the company logo. Even the view from its offices of Caerphilly Castle instils heritage and a sense of patriotism.

Initiatives in south-east Wales have helped stimulate the insurance market in recent years. The Millennium Stadium and Cardiff Bay have brought attention to a corner of the map that has been in decline for some years.

South Wales is now home to a thriving IT Silicon Valley, as well as an estimated 50,000 students. Blocks of new flats dwarf Cardiff city centre and the Welsh Assembly offers the prospect of independence and devolution.

About 50 intermediaries are registered in the region, broking £80m worth of premium income. Thomas Carroll has a 13% to 15% share, but plans to reach 20% in the next three years.

Despite being only 40 miles from Bristol Thomas Carroll envisages growing only in south-east Wales. It is fiercely independent.

"There seems to be a reluctance [for the Welsh] to deal with people in Bristol," says Thomas Carroll group sales and marketing director Paul Gardner. "People like to deal with someone they know is very close to them.

"If clients know they have to ring somewhere like Bolton that doesn't go down well. That is part of national pride.

"A few years ago the vast majority of insurers moved out, but now they are coming back. They've realised the importance of business in south-east Wales."

Although local knowledge is fundamental to trading in the area, many insurers have moved their claims handling centres to other cities following mergers and acquisitions. Gardner, who also sits on the council of Cardiff's chamber of commerce, says that trend will continue.

"We have always supported companies with local claims experience," he said. "It is with regret that most of the claims services we enjoy now are provided from centres hundreds of miles away. The ability to pick up a file, jump in a car and thrash out a settlement with a claims manager locally is tremendously important.

"I don't think there are any commercial claims handled in south-east Wales and I don't think it will come back."

Commercial combined insurance represents 22% of Thomas Carroll's business, 18% is property owners, 10% motor fleet and the remainder is motor trade and liability risks.

Although more than 90% of its business is placed in south east Wales through insurers like Royal & SunAlliance, Norwich Union, AXA, NIG, Allianz Cornhill and Zurich, Thomas Carroll relies on the London Market.

Gardner says 6% of risks are placed at Lloyd's or through Lloyd's service companies.

"Since 11 September we have found it difficult to place new business with Lloyd's as it is obviously concentrating on getting terms for existing clients," he says. "But Lloyd's is an important market and we will always deal with it. It is good for niche business like motor fleet market and liability."

Although a small chunk of business is placed in London, Thomas Carroll is firmly rooted in south-east Wales. It sponsors the Welsh Cricket League and South Wales Football Association. For the last three years it has raised more than £10,000 for a local children's hospice, Ty Hafan.

Group managing director John Moore explains: "We believe in putting back into the communities that have supported us for so long."

Thomas Carroll has also been appointed the Neighbourhood Watch broker for the whole of Wales, a risk that is insured by Norwich Union. It also sponsors prizes and awards promoting enterprise in Wales at the University of Glamorgan .

Moore says: "The business plan is to encourage students to think about setting up their own enterprises rather than moving to another business. Wales lags a little behind in setting up new companies."

Gardner says the future of the south-east Wales insurance market will witness further consolidation. In January it bought Cardiff brokers Cowdery & Morris and is now in discussions to acquire other intermediaries.

"If small brokers in south-east Wales do not want to go through the pains of Financial Services Authority regulation they may ask us to come and talk to them. That's one way in which we can grow."