We asked you about the changing landscape for personal lines motor. You said …
1 What proportion of your business is personal lines motor?
2 Have you seen a swing back to brokers as consumers seek better advice about the finer points of different motor policies?
3 How confident are you that the government’s crackdown on whiplash will deliver lower levels of fraud?
4 What role do you think telematics-based insurance will have in the insurance market in the next few years?
5 What has been your experience of niche motor business (such asmotor cycles, caravans, vintage cars) during the past 12 months?
6 Are you concerned that advances in technology, such as smartphone insurance applications, are a new threat to brokers?
Brokers lacking love
Our survey shows that 38% of brokers make less than one-fifth of their top line from motor.
The likes of AA, Swinton and Kwik-Fit are trading through aggregators, and making a profit by selling ancillary products and taking referral fees. Commission on breakdown cover can be as much as 60%, on legal expenses 80%, and on loss of keys 40%.
But for smaller brokers, life is tough in motor. One respondent explained how the business had changed over the past few years: “Our business started as a personal motor insurance broker, but we have seen our policy count halve in the last three years. I don’t want it back on the current terms offered by insurers - I’d want a minimum 17.5% commission.”
Our survey shows that 59% of brokers lack confidence that the government’s crackdown on whiplash will make a difference to increasing personal injury claims. Respondents also cite aggregators as the main reason for the rise in application fraud, with customers manipulating their information to get lower premiums.
Comparison websites are currently used to generate quotes by 44.1% of consumers, down from 51.4% in 2009, indicating a small swing away from aggregators.
Size of the UK motor
insurance market in 2011
Personal lines motor
market in 2011
Commercial lines motor
market in 2011
Rise in premiums during 2011
Proportion of brokers in this survey saying that personal motor is more than 60% of business