Primary General boss Tim Rolfe says broker market consolidation is not hampering the underwriting company’s growth.

Given the rate of consolidation in the broker market, one would be forgiven for thinking underwriting company Primary General would be under pressure.

With small brokers being the core market for Primary’s commercial lines products and the larger brokers’ unquenchable thirst for acquiring their smaller rivals, the prevailing dynamic must surely be bad news for Primary.

But Tim Rolfe, chief executive of Primary Broker Services Holdings, the parent of Primary General, and its sister company, agricultural underwriting specialist Rural, insists not.

Rolfe rejects the suggestion that the company’s target market is in decline. “The number of smaller brokers has not changed a great deal,” he says, adding that consolidation has happened at the top end of the market.

Rolfe describes the broker market as a pyramid with a large number of small brokers at the base and a smaller number of larger brokers at the top. It is the top portion of the pyramid that has, in the main, been gripped by consolidation fever, he says.

He says smaller brokers are still flourishing but are struggling to get the high level of service they need from the major insurers.

“That market place [smaller, independent brokers] is underserviced. There has been a lack of focus by insurers on the independent brokers that have struggled. Some of these brokers are staunchly independent and are growing,” he says.

“Our entire strategy is focused on that group of smaller brokers. It’s about having the right commission arrangements, service and advice. Also, we have doubled the number of products in the past eight months.”

“We moved into the relationship with RSA very quickly. It was a matter of weeks. [In hindsight] we should have taken a little longer.

Primary General and Rural are actively trading with currently around 500 brokers and Rolfe expects the number to grow, along with the penetration of Primary’s products into each broker’s business.

Rolfe highlights the recent trend of disenchanted brokers leaving the consolidators to set up on their own. “They are concerned about getting agencies and compliance. We think they can provide a great service to customers. We provide three simple things: great access to underwriters – who you can speak to – which is key to brokers; good service; and exclusivity,” he says.

Product pipeline
This year has already seen Primary General launch a contractors’ policy, taking its product portfolio to 10. It is also set to launch its first financial lines product, a professional indemnity and directors’ and officers’ liability product, at the end of the month. This will be backed by a Lloyd’s syndicate.

Rolfe is excited about the move. “It is of real interest to me. It could be the start of other financial lines products for us,” he says.

The past year and a half has seen many changes at Primary General. Rolfe himself has been in the top job for only four months having been promoted from chief operating officer last December after the sudden departure of Jonathan Davey.

“There has been no change in our strategy or plans as a result and we move on accordingly,” is all he will say about Davey’s unexpected decision to stand down.

Primary General was launched in January 2007 following the merger of underwriting agencies Primary Broker Services and ATD General, creating a business writing £100m in annual premiums.

A new management structure was subsequently created to support its regional office network. It now operates in five main regions: London and the South East, the Midlands and the South West, the North East, the North West, and Scotland and Northern Ireland.

“There has been no change in our strategy or plans - we move on accordingly.

“It is about developing services that fit,” says Rolfe. “Our distribution strategy is set. We are now adding new products and services. Getting established among that [target] group of brokers is the priority. We now have a good policy range, service and teams of people. It’s been a lot of hard work over 18 months to bring it together.”

During that time, Primary suffered the public and embarrassing setback of losing its major binding authority deal with RSA. The insurer terminated the deal two years before it was due to expire. Norwich Union swiftly stepped into the breach to take over from RSA.

What did Primary learn from this episode? Rolfe says: “We moved into the relationship with RSA very quickly – it was a matter of weeks. [In hindsight] we should have taken a little longer.”

Rolfe is, not surprisingly, at pains to stress the strength of Primary’s relationships with its other carriers, which include AXA, NU, MMA and AIG. He says Primary’s relationship with AXA – its largest capacity provider – is stable.

“We have built our relationships with insurers on transparency, a focus on underwriting and hard work,” he says.

Looking forward, a key area of focus is developing Primary’s e-trading capabilities. Its e-trading platform, Primary General Online, already offers commercial package, tradesman and contractors covers. Rolfe is keen to expand the product range and functionality of the system.

“Dealing with traditional package policies can be time consuming and costly – and therefore not profitable – for brokers. We are working to get more of our product range on the platform with full functionality,” he says.

Primary General timeline


Tim Rolfe appointed as PBS Holdings (PBSH) chief executive.

Jonathan Davey quits as chief executive of PBSH.

RSA pulls out of binding authority deal with Primary General; Norwich Union steps in.

Primary General launched, following merger of ATD and Primary Broker Services. Richard Pitt appointed managing director of Primary General.

August 2006
Pitt appointed managing director of Primary Broker Services.

July 2005
Tim Rolfe appointed chief operating officer of PBS Holdings.

December 2004
PBS Holdings created as holding company for Primary Groups underwriting businesses.

December 2002
ATD General acquired by PBS parent, Primary Group.

April 2002
Primary Broker Services begins trading.