Graeme Trudgill, BIBA CEO, talked openly and honestly to Mike Keating about the key challenges impacting the broking community in the first episode of the MGAA’s brand new podcast series.
Regulatory communications gap
At the top of Graeme’s agenda, which can also be said for much of the rest of the insurance market, is regulation. In his view, the last six months have been an “incredibly tough spell with regulation”, with brokers now having to find ways to demonstrate to the FCA that they are providing fair value to customers, and that broker commissions can be justified, especially at a time when premiums have been rising.
At the heart of Graeme’s concerns are that the regulator simply does not have a true understanding of the incredible role that brokers do, and the work they put in, often in very difficult circumstances – such as in the wake of Covid and Grenfell, when premiums in some markets skyrocketed. BIBA’s mission now is to put a real focus on addressing this communication gap with the FCA, to ensure the regulator has “a better understanding of general insurance brokers and intermediaries, which includes MGAs of course, because they play a really important role in matching clients needs with the insurance that allows them to transfer their risk”.
Graeme’s views are, he emphasised, backed up by BIBA’s membership. The message coming out of BIBA’s recent ‘tour of the regions’, during which Graeme spoke to over 700 brokers, was resoundingly that any future regulation must be “balanced and proportionate” and that the FCA needs to provide more guidance and commentary around how regulation will affect business and exactly what is required in terms of reporting.
MGAs to the rescue
The conversation then turned to partnerships with providers and the positive role that MGAs play, especially when they ‘step up’ in markets when traditional insurers pull out, including personal lines. Graeme explained that “when capacity is withdrawn, brokers look for new opportunities and new names and new partners, and MGAs have absolutely stepped up to the mark, so a huge well done to them.” Fundamentally, he added, “our members want a number of things, including good, long-term capacity.”
BIBA’s CEO was also candid about the service challenges being seen from traditional insurers, particularly with insurance personnel increasingly working from home, resulting in brokers having to wait longer for responses to their queries and to get access to decision makers. Graeme did note however that there was at least now a clear recognition of the improvements that needed to be made and a clear desire from insurers to make them. “What I would say is that in the main they’re very competitive, they want to do better, and they recognise what their challenges are and how they can improve – which they have been doing.”
MGAs, however, he said, have continued to offer a fantastic service, offering a more tailored service to brokers, which has, of course, been a major draw. The bottom line for Graeme is that “what MGAs have managed to wrap up together is a good service proposition, good capacity to cover non-standard risks and fill the gap where other insurers have pulled out.”
You can listen to the full episode here – https://mgaaconversations.podbean.com/
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