Cheshunt might seem an unusual location for a company that insures West End musicals, but it is on target for a premium income of £4m and 150 broker clients. Christine Seib report

Every morning as workers swarm from the commuter belts into London, Paul Byrne and Frances Stacey drive the other way. Their office is on the outskirts of Cheshunt, Hertfordshire, in an 18th century building that used to be a theological college owned by Selina, Countess of Huntingdon.

It overlooks a leafy park. The walls are tasteful lilac and technicians are scurrying around, laying cables for Stacey's new office. On the second floor, their meeting room is lined with glossy, framed posters of top West End musicals.

It's a long way from the fax, phone, computer and printer they started with in Byrne's front room two and a half years ago. Byrne & Stacey Underwriting (BSU) started operating on 19 January 2000 and, by the end of that year, it had 100 brokers and a gross premium income (GPI) of £436,000. By the end of 2001 it had 150 brokers and £2.45m GPI. It expects to exceed its 2002 target of £4m GPI by at least £500,000 and to have taken over adjacent offices to accommodate its expansion.

BSU specialises in personal accident, travel, medical expenses and entertainment insurance. Cheshunt might seem an unusual location for a company that insured Cats, Phantom of the Opera and Notre Dame de Paris, but it has an entertainment pedigree. Victoria Beckham, aka Posh Spice, grew up in this Hertfordshire town and her parents still live in a mock Tudor mansion a few streets from BSU's offices. David Beckham's red Ferrari is often parked near BSU's local, The Prince of Wales.

Byrne learned his specialties at Anthony Kidd Agencies, where he first met Stacey, who joined from Compass Underwriting. After getting a binder from Gerling, they left to set up their underwriting agency with only their own funds and a spare room in Byrne's house to operate from. They targeted independently-owned regional commercial brokers - and made sure they gave them what they wanted.

"Those brokers have 1% of their total turnover in personal accident and travel so we have to make dealing with us so quick and easy that they don't have to think about looking anywhere else," Byrne says.

"Once we've done that, we have to get them to be proactive and up-sell personal accident and travel to their commercial clients.

"It's a slow process of building up trust and providing what we say we will."

This has meant developing, mainly in-house, a website (www.bsultd.com) that can give a quote within one minute. This is perfect for 90% of their business and gives them more time to work on the bespoke policies needed by the other 10%.

Byrne says BSU's classes of business have not been hit by the rate hikes experienced by most other lines.

"We're not under pressure to raise rates 100% or 200%," he says.

"Our average increase this year is between 10% and 15%."

Byrne says the underwriting profitability of BSU's classes of business was relatively steady as well.

"We're lucky we write a predominantly UK sterling book of business and, in the absence of any major shock losses, it's profitable," he says.

"Obviously, I'm biased because it's all we write. There's also a great emphasis on liability, partly because of the legal requirement. But the most important part of any business is the people within it," he says.

"Why you'd ensure property and ignore the people within it is a mystery to me. We're constantly trying to get the message across that people are as important as property."

Byrne says brokers often ask BSU to branch into other classes of business, such as liability, but he says he will continue to refuse until he and Stacey are "comfortable with hiring someone who is an expert, and letting them develop it".

He knows that service is key to retaining his clients. He claims that documents are sent out within four days, every policy is checked by a senior underwriter, there is no automated switchboard and calls are returned within 30 minutes.

He doesn't want to lose these personal touches that a small agency is good at. But his agency won't stay small. He says it's likely BSU will outgrow its current offices in a year or two.

However, Byrne is confident they'll stay in the area, where most of his staff live 10 minutes from the office.

"Our business is spread far and wide around the country, but here we're close to London and all the major stations and airports, as well as the M25," he says.

"As we grow, the challenge will be to persuade people to work slightly out of London, rather than travelling in.

"I know what I prefer."