Daily briefing: Wednesday – Rural monopoly set to crumble

As a rule, NFU Mutual has flown under the radar of the rest of the insurance industry. The insurer, which specialises in rural insurance for farmers, has been pigeonholed. But don’t be fooled! According to the 2010 Insurance Times Top 50 Insurers, it is in fact the 16th largest player in the market, just behind QBE and in front of household names such as Fortis, Brit, Esure, Groupama and Legal & General.

Which makes our exclusive story that its 2010 profits plummeted by 57% year-on-year all the more interesting. The insurer also made an underwriting loss of £150m in the year, deteriorating from an £118m loss in 2009.

The company blamed weather-related losses and personal injury claims for its losses, as well as lower investment returns. These are problems felt across the market, but have apparently hit NFU particularly hard.

Hitherto, the insurer has had a practical monopoly on insurances for farmers – and that’s not just land related. There’s fleet, liability, related personal insurances; a potentially lucrative pot. Competitors are already scenting an opportunity – Primary Group’s Rural Insurance, for example, is talking of ambitious expansion plans.

There’s an opportunity here for brokers, too. NFU sells its non-life insurances through tied agents who traditionally have been many farmers’ sole point of contact. If the monopolised market opens up, there’s a whole new segment of clients fresh to the broking sector. Watch this space!

AXA’s next steps

AXA’s commercial chief Amanda Blanc continues to implement her master plan, today announcing the UKs eight branch managers. Empowering the regions to make connected underwriting and sales decisions has been a key part of Blanc’s plan from the start, and she will be pleased to have all her soldiers lined up and ready to go into battle. There have been numerous high-profile departures from AXA in the last couple of months – as well as arrivals – and the insurers now needs a period of stability for its new management team to bed in and the market to start talking about its performance and stop talking about its personnel.

All change at Heath Lambert

Talking of personnel, more news from Heath Lambert, whose new parent company Gallagher has reshuffled the board. This is only to be expected in the wake of the acquisition, and the two companies will be working out their new structure for some weeks.

Ellen Bennett is editor-in-chief.