Broker schemes data reveals the lines with ‘consistent growth in earning value’

The overall premiums earnt by broker schemes increased by 18% period-on-period in the most recent data, according to the latest Insurance Times Schemes Index, which covers the period between 1 July and 1 December 2024. 

That was according to Adam Bishop, chief executive of broker schemes software provider SchemeServe, which provides the data for the index from its platform. 

The previous Insurance Times Schemes Index, published in September 2024, indicated a “slightly improved trading period” and a partial recovery in premiums earned for brokers. 

This iteration of the index has shown a continuation in this trend of recovery, with 21 of 27 measured lines showing percentage increases in commission earned for brokers. 

Bishop added that, of those 27 lines, 18 also saw first premium commission increases when compared to the previous six month period, while a different selection of 18 lines also saw renewal premium commission increases. 

He also noted that premium values percentage rises were largely in line with increases in commission earned in this period of analysis, which he said was “establishing something of a trend”. 

When the previous index was published, Bishop told Insurance Times that the rate of increase in commissions earned had outstripped the rate of increase in premiums, so a return to largely equivalent increases represented what “should be expected”. 

Top performing schemes 

Comparing the second half of 2024 to the same period last year, the schemes lines that saw the largest increase in commission percentage were commercial combined, motor trade and commercial property owners. 

The commission brokers earned from commercial combined lines increased 33% year-on-year, equivalent to an uplift of £1.24m.

Motor trade schemes also saw a 27% rise in commission on SchemeServe’s platform, which equalled a £129,853 total uplift.

Commercial property owners schemes rounded up the top three schemes year-on-year, with commission increasing by 26%. In this line, however, actual premiums earned only increased by 6% over the same period, indicating a faster rate of increase in commissions not tied to premium increases. 

This was not the case in commercial combined or motor trade schemes, where 30% and 16% increases were closer to the rate of increase in commissions earned. 

In the previous Insurance Times Schemes Index, this top three included commercial combined and commercial property owners schemes, but motor trade was edged out by an impressive rise in commission from SME package schemes. 

In this iteration of the index, SME package schemes still saw an appreciable year-on-year increase of 11%, placing it in sixth below the top three and excess of loss liability and combined liability schemes. 

Bishop added that while percentage increases in commission value for SME packages schemes was slower than some other lines, this type of scheme actually saw one of the largest increases in total commission value. Brokers operating on SchemeServe’s platform earned an additional £766,349 when compared to the same period in 2023.

When looking at the last six months of 2024 in comparison to the first half of the same year, a different set of business lines occupied the top three for broker commission earned. 

Period-on-period, the largest earner of broker commission was pubs and clubs schemes, which saw a 44% increase equivalent to £521,187. 

Pubs and clubs schemes were followed by household schemes, which saw an increase of 43%, and caravan and trailer schemes, which saw an increase of 39%.

Across both year-on-year and period-on-period comparisons, Bishop noted that commercial combined, SME package and commercial property owners schemes had shown ”consistent growth in earning value and a reliable growth in income” for brokers. 

He added: “On the platform, the overall premium increase across all schemes averaged over 18% period-on-period, which represents growth well above general inflationary indexes.” 

Cyber in the red

Commissions earned by brokers operating cyber schemes showed the first signs of a readjustment in the previous Insurance Times Schemes Index, falling year-on-year by 3.4%, which was equivalent to a decrease of £16,838. 

This trend has solidified and accelerated in the newest data, with commissions earned falling by 48% year-on-year. This equalled a fall in actual commission earned of £245,642, making cyber lines the worst performing line by far.

The poor performance of cyber schemes is only compounded by the period-on-period data, which showed that the second half of 2024 was 46% worse for commission earned than the first half.

When digging further into the data, this fall in commission for brokers is shown to be reflective of major price adjustments – while premiums earned period-on-period fell by 53%, the amount of broker schemes for this line actually increased by 318, which was an increase of 8%. 

Commission from renewals also fell by 65%, while commission from first premiums only fell by 33%.