Brokers optimistic despite economic gloom
Insurance brokers are upbeat about future growth prospects despite gloomy economic conditions, according to a new survey by Macquarie Relationship Banking.
Its annual Road Ahead Insurance Broking Industry Survey found 86% of brokers expect at least moderate growth this year, with 27% anticipating growth in excess of 15%.
The survey involved 171 insurance broker members of cluster groups Austbrokers, IBNA and Steadfast, as well as a number of independent brokers.
Macquarie Relationship Banking Division Director Paul Cilia says a predicted increase in premium rates may explain brokers’ optimism.
But several factors may yet impede those growth prospects. Brokers say the three biggest threats to growth are the parlous state of the economy (24%), declining premiums (24%) and staff resourcing (22%). Last year only 6% were concerned about the economy.
Brokers also revealed considerable interest in diversifying their businesses. Some 29% registered interest in taking on an underwriting agency, while financial planning (28%), mortgage broking (19%) and accountancy ventures (7%) were also mentioned.
And they’re acting on their instincts, with 57% of brokers saying they have made some form of business acquisition during the past year. Another 44% of respondents say they have been approached to sell or merge their business.
Mr Cilia says service, price and specialisation “will largely determine how well brokers chart current conditions”.
The survey shows authorised representatives are becoming widely accepted in the broking community. Some 71% of those polled would consider taking on an authorised representative and almost 40% respondents do so currently.
Brokers also expect consolidation of the industry to continue, with 81% of those polled predicting broker numbers will decline by 2010. And 83% expect fewer insurers to remain in the market.
Its annual Road Ahead Insurance Broking Industry Survey found 86% of brokers expect at least moderate growth this year, with 27% anticipating growth in excess of 15%.
The survey involved 171 insurance broker members of cluster groups Austbrokers, IBNA and Steadfast, as well as a number of independent brokers.
Macquarie Relationship Banking Division Director Paul Cilia says a predicted increase in premium rates may explain brokers’ optimism.
But several factors may yet impede those growth prospects. Brokers say the three biggest threats to growth are the parlous state of the economy (24%), declining premiums (24%) and staff resourcing (22%). Last year only 6% were concerned about the economy.
Brokers also revealed considerable interest in diversifying their businesses. Some 29% registered interest in taking on an underwriting agency, while financial planning (28%), mortgage broking (19%) and accountancy ventures (7%) were also mentioned.
And they’re acting on their instincts, with 57% of brokers saying they have made some form of business acquisition during the past year. Another 44% of respondents say they have been approached to sell or merge their business.
Mr Cilia says service, price and specialisation “will largely determine how well brokers chart current conditions”.
The survey shows authorised representatives are becoming widely accepted in the broking community. Some 71% of those polled would consider taking on an authorised representative and almost 40% respondents do so currently.
Brokers also expect consolidation of the industry to continue, with 81% of those polled predicting broker numbers will decline by 2010. And 83% expect fewer insurers to remain in the market.