Insurer announces variable commission plans for SME
Zurich's UK commercial business has announced plans to offer variable
commission rates to brokers placing small and medium enterprise (SME) cover online.
Head of market management for Zurich's UK commercial business David Smith said that by offering brokers the ability to choose the level of commission they earned, Zurich was giving its brokers a better chance at retaining and winning
business in what he described as "a highly competitive market".
Smith said: "Brokers' workload in winning or retaining business varies considerably. The facility to select a commission level that reflects the value added by the broker, in a manner that is transparent to the customer, reflects this."
Under the plan, brokers can choose from a number of commission rates ranging from 0% to 20% for SME property and 0% and 12.5% for SME motor risks.
Smith said the initiative built on Zurich's launch last year of varying commissions on motor business handled through software houses.
The move follows an admission by Zurich that, despite building a sizeable account, it has neglected SME business in recent years.
A spokesman for Norwich Union (NU) said it was also considering a similar plan to offer brokers a choice of commission levels for SME business transacted online.
“It's something we're looking at, but we haven't made any decisions yet,” the spokesman said.