In last week’s Sunrise Exchange News we reported comments by Lumley General Insurance CEO David Matcham on the subject of brokers’ independence.

Mr Matcham says he intended the comments to refer only to brokers’ work in the small and medium-sized enterprise (SME) market. We have established that the question which prompted his comments referred to the SME market. We apologise for the confusion.

Mr Matcham said that in dealing with SME business, brokers aren’t as independent as they used to be, with many relying on agent-like agreements with insurers.

“The dynamics are changing… and I think brokers are becoming tied agents of insurers,” he said. “They’re no longer giving advice, they’re no longer broking the business; it’s just going down a channel.

“For insurers you have either got to build a strategic alliance with a broker and be part of his panel, or you retreat out of that market, or you compete with it and you start up a direct line, which is also what’s happening.”