Insurer follows Aviva in return to the comparison websites
Zurich has joined Aviva by performing a U-turn and returning to the aggregators, while cutting 243 job roles, including 149 redundancies.
The Swiss-based insurer axed its aggregator venture Zurich Connect in December, but has been attracted back by hardening rates and the chance to regain market share with what it claims is a more competitive and vastly improved model.
Endsleigh will carry out sales, servicing and premium collections for Zurich’s aggregator business.
Aviva will also return to the aggregators in the coming weeks, while also keeping its direct arm.
Deloitte partner Ian Clarke said the name of the game on price comparison sites was stripped down, simplified products and customer queries answered by automated response rather than expensive staff costs.
“You have got to have a 10%-12% expense range, whereas at the moment, the business model is still up in the 20s,” he said.
Zurich personal lines director Karl Bedlow stressed the insurer was totally committed to the broker channel, adding: “The problem that brokers have with aggregators is with the competition they provide; it’s not about Zurich being on aggregators.”
However, Zurich still faces a battle to convince personal lines brokers. One broker boss said: “It doesn’t make any sense. If they’ve had a kicking in the last five years, I can’t see how it will be different this time around.”
The majority of the 149 redundancies will be in Cardiff. Bedlow said the decision to axe jobs would be “difficult” for staff, but added that the business had to constantly change and adapt to market conditions.