Brokers are "outraged" at letters sent by Zurich to small and medium-sized enterprises (SMEs) inviting them to renew direct with the insurer.

One broker, who was given a copy of the letter by a client, claiming it could "go direct to Zurich and it could cost you less", said the practice was "outrageous".

"They are directly attacking brokers' business," he said.

A spokeswoman for Zurich said that since January 2003, the company's three-year old business insurance direct division has written to SMEs inviting them to renew direct with Zurich.

She said that Zurich generates SME prospects to write to by "buying databases of SME businesses, which also includes renewal dates".

The spokeswoman said the lists were cross-referenced against Zurich Commercial customers to ensure that it did not write to its own customers.

She defended the practice saying that some SMEs wish to buy their insurance direct over the internet and

Zurich was catering to these businesses.

"All we're doing is saying this is another option you have," she said. "Zurich has always been very clear that we're a multi-channel operation."

Insurance Times' research partner, Datamonitor, has released a new report into SME purchasing behaviour.

The report, Targeting SMEs in UK General Insurance 2004: A Unique Insight into the Purchasing Behavior of SMEs, is available to buy from the Research and Statistics section of the Insurance Times website. Click here for more details.