How can schemes transform brokers into ‘trusted advisors’ for UK SMEs?

Many SMEs feel underserved by the financial services sector.

According to the SME Financial Services Tracker Report by Saffron Building Society, which polled 502 UK SMEs in May 2024, 60% of respondents think that major banks put larger businesses first, while 50% believe that financial services providers do not understand their businesses or its unique needs.

Brokers, however, are one component of the financial services market looking to plug this service gap through the provision of insurance schemes.

Christopher Barclay, chief commercial officer at Superscript – a shortlisted firm in Insurance Times’ Schemes Broker of the Year category at the 2024 Insurance Times Awards – noted that brokers are in a unique position to play an essential role in supporting SMEs throughout their entire insurance journey by tapping into broker schemes – assisting with everything from policy acquisition to claims resolutions.

He told Insurance Times: “Broker schemes can offer cover that goes beyond traditional insurance products, emphasising a relationship driven approach rather than a purely transactional one.

“This means brokers serve not only as product providers, but as trusted advisors. By adopting this dual role, brokers can deliver the value that SMEs require.”

Barclay confirmed that although there are many scheme propositions in the market that cater for UK SMEs, there is much more that can be done to “truly meet the needs of UK SMEs”.

Sector specific

The primary way that broker schemes can support SMEs is by providing tailored and innovative insurance propositions, according to Toby Clegg, chief executive at broker Clegg Gifford – another Schemes Broker of the Year finalist for 2024.

John Dawe, delegated partnerships director for MGAs and schemes at insurer RSA, agreed with Clegg.

He added that often, schemes are marketed by a particular trade body or a specialist scheme broker, showcasing precise cover that is needed by a specific trade sector – including cover for legal expenses.

“It’s those types of things that you will never find in a typical SME product,” he pointed out.

Examples here include schemes insuring early year education settings, such as children’s nurseries, which require cover for the loss of Office for Standards in Education, Children’s Services and Skills (Ofsted) registration, or medical practitioner scheme customers that receive legal defence costs cover in relation to fitness to practice cases.

RSA works with broker Leisuredays to provide a scheme insuring holiday parks, Dawe said. This aims to help around 4,000 of these venues to identify and mitigate flood risks.

Through this scheme, RSA claimed it has been able to maintain insurance cover for holiday park owners at stable, competitive premium levels, achieving a “91% client retention and a nine out of 10 average claims service rating”.

Adding value

Superscript’s Barclay added that supporting British SMEs is not just about insurance products, however – broker schemes should also encompass value-added services, such as legal and tax advice.

For him, broker schemes can only back SME growth if brokers invest in deep vertical expertise and immerse themselves in in their “clients’ communities to understand their unique environments and challenges they face”.

He elaborated: “The most effective schemes are those where brokers have field specific expertise at every level, including claims management.

“This level of understanding ensures that brokers can provide tailored solutions that go beyond the basics, forming strong, trust-based relationships with their clients.”

Superscript strives to develop this end client understanding through the use of its artificial intelligence (AI) platform, called the Real Time Scorer (RTS).

Analysing customer behaviour to “understand their needs in milliseconds”, the RTS aims to enable the delivery of personalised support for SMEs.

So far, the technology has been achieving results for Superscript – Barclay said that since the RTS’ implementation, 90% of the broker’s customers who had received an insurance quotation have “made a purchase the same day” and that “10% more customers complete a purchase using RTS”.

Barclay added that Superscript has achieved 50% year-on-year growth through its focus on SME clients.

Technology refresh

Barclay is of the opinion that many broker schemes designed for SMEs that are currently available in the market should be refreshed to align with the specific demands and expectations of today’s SMEs – he feels that many schemes lack the efficiency and responsiveness that modern SMEs require.

This presents an opportunity for brokers to become more relevant by using technology to better understand their customers and remove outdated manual processes from the customer journey.

With automation, AI and data analytics, brokers can provide “quicker solutions that respond to customer needs far more effectively than traditional methods that might take six months to a year to implement”, he explained.

Differentiation

The end goal for an SME focused broker scheme should be to create a centre of excellence by packaging together different products, services and propositions that address a customer’s niche.

This could include putting together seminars with end customers and brokers in particular trade sectors, or it may involve bringing in a legal team to protect customers when faced with a crisis management situation.

For example, Superscript partnered with Checkatrade – a UK-based website and app that connects consumers with qualified tradespeople – in January 2024, to develop consumer applications that identify customers, personas and types of risk in order to support the businesses that Checkatrade serves.

Barclay said: “This is not a transactional approach – it is relationship driven and designed to accompany the business on a 12-month journey, not just when the policy is purchased.

“By integrating technology and maintaining close relationships with our partners, we ensure that SMEs receive proactive, comprehensive support.”

According to statistics published by the Department for Business and Trade in October 2024, there are around 5.45 million SMEs in the UK today.

Therefore, effectively tapping into sector specific niches and technology to forge thoughtful broker schemes catering for various offshoots of this demographic could prove to be a lucrative move – for both broking businesses themselves and the UK economy, as insurance cover can give small businesses the confidence to stretch their wings.