Weekly briefing: 6-12 May

While a great deal of attention has been focused on Manchester for this year’s Biba conference (click here for our full coverage) and the planned merger of Biba and IIB, there has been plenty going on elsewhere.

The long-awaited results of the ultimate holding company of the Giles group are out, and they’re not pretty. The company’s after-tax loss worsened £37.1m for the year to August 2010, the bulk of which is down to hefty interest payments. The real difference between the two years, however, was caused by a decision to shorten the goodwill amortisation period, which effectively doubled amortisation charges compared with the 2008/09 year of account. The company expects these charges to be higher in future periods as a result of its decision, so this could continue to be a drag on results.

A Brightside for RAC?

Perhaps the most surprising story of the week, however, is that broking group Brightside has emerged as a contender to take over RAC, which Insurance Times revealed Aviva is planning to sell.

It is thought that Brightside will enlist the help of private equity firms and banks to take over the company, which analysts estimate is worth around £600m. Brightside is pitting itself against five private equity firms.

When brokers underwrite - and vice versa

Lockton International’s new managing general agency, which we revealed last September and have been watching with interest since, has received approval to start writing from the FSA. It will initially write only Lockton business, but later plans to accept business from third-party sources. But just as brokers are pushing more into underwriting, it seems underwriters are pushing back, as highlighted by by esures move into broking.

Where Lloyds leads …

After Lloyds Banking Group broke rank and put up a £3.2bn provision to cover compensation for mis-sold payment protection insurance (PPI), it was only a matter of time before its peers in the banking world followed suit. Barclays was next, with a £1bn provision, followed closely by RBS and HSBC.

The banks’ revelations have sparked concerns of a hike in the FSCS levy on brokers, which is sure to ruffle a few feathers.

Cooper Gay gets a GRIP

Almost as controversial as FSCS levies are brokers’ attempts to earn additional remuneration from the underwriting community by offering them services. We revealed this week that Cooper Gay has launched a pricing database, along the lines of Aon’s GRIP and Marsh’s MarshConnect service.

However, Cooper Gay’s fledgling offering has not yet reached a stage where the broker can charge underwriters for access. Even so, we should expect more brokers to follow suit.

Phoenix from the flames?

RBS Insurance has been in the headlines a lot over the past week. While the insurance unit is no stranger to being the centre of attention, this time it is for all the right reasons. RBSI returned to profitability in the first quarter of 2011 after four consecutive quarters of losses.

While RBSI is not out of the woods yet, it is clearly heading in the right direction. Continuing the theme of resurgence, RBSI’s commercial broker unit NIG launched a new brand and NIG First, a club for selected brokers.