Zurich Personal Insurances is threatening to deal directly with an Essex broker's clients after cancelling his account on cost grounds.
The Chelmsford-based IBRC member, who wants to remain anonymous, said ZPI have told him they no longer wanted his personal lines business because it fell below their required minimum of £20,000 per annum.
He said the decision came as a bombshell after many years of trading as a ZPI agent and despite achieving a high retention rate for the mix of household and motor business.
The broker is further alarmed that ZPI have apparently informed him they would contact his clients directly, unless he was able to find another broker to take on his personal lines business before September.
“This is just the way things have changed since Zurich took over Eagle Star two years ago,” he said.
ZPI spokeswoman Wendy May said it was not the insurer's policy to cull accounts that fell below £20,000.
“The cancellation is part of our on-going broker relationship management.”
She said it aimed to work with brokers suffering low levels of business to boost their accounts by offering marketing and other support.
It is only as a last resort that it considers cancelling an account. “At the end of the day, if business volumes fail to increase and the account remains unviable, then we will take the step of cancelling that agency.”
May said brokers in this position would be encouraged to pass the business to another broker, or place the account with another insurer.
If brokers are unwilling to proceed with either option, ZPI would offer to contact the brokers' clients direct on renewal of their policy.
May explained: “We feel we have a moral obligation to offer our customers the opportunity to do business with ZPI.”
However, she stressed this only happened in exceptional circumstances and clients would not be approached by Eagle Star, its direct writer.
