Brokers have a long way to go before they are considered leaders in innovation, according to Macquarie Business Banking’s latest Insurance Broking Benchmarking Survey.

Just 8% of respondents say they are leading the way in innovation, while 41% believe they are keeping pace with the industry.

About 45% have made changes but could do more, and another 6% fear they have fallen behind.

Less than half (44%) have mobile-friendly websites, with 41% active on social media.

The survey is an in-depth study of 200 broking businesses of all sizes across Australia, following previous questionnaires in 2011 and 2013.

“Many businesses are only just beginning to realise the potential of digital technologies, including web-based service delivery,” Macquarie says. “While three in four said they use their website for brand promotion and lead generation, only 5% of new business came via the web.

“Meanwhile, just one in 10 firms offered full quote, bind and pay capabilities online.

“That potentially makes brokers vulnerable to emerging competitive threats, including the potential for disintermediated business models from new and established providers selling direct to business clients.”

About 49% of businesses see direct sales by insurers as a key threat in the year ahead, but only 15% consider insurtech start-ups an issue, “despite signs of increasing activity”.

One in four reported a drop in revenue this year, but nine out of 10 recorded a profit thanks to “a persistent focus on controlling costs”. Some 33% achieved margins of 30% or higher.

More than one in four respondents have no plans to hire staff next year, but 51% say they are willing buyers of other businesses.

“The result is very much a seller’s market, with only one in five principals willing to even consider selling,” Macquarie says.

Brokers are optimistic about the future, with 87% expecting higher revenues next year.

National Head of Insurance Broking Eoghan Trehy says many businesses believe hardening premiums over the next 12 months will be a key factor underpinning future growth.

“While smaller businesses are focused on premium funding revenue and improving back-office efficiencies further, high-profit businesses that have already bedded down more productive workflows and tools will prioritise new client acquisition to drive higher profits.”

Click here to access the full survey.