Leader: Swings, roundabouts and consolidators

And so it all begins again. RSA is pumping money into Oval. Jelf is frantically trying to raise cash. Axa is to resume feeding Bluefin. Towergate continues to spin plates. And Giles just can’t spend the dollars that it may or may not have burning a hole in its pocket. So where will it end?

In a public listing for some, in tears for others, and in a giant corporate love-in for those who can manage to put personalities to one side. “They’re all going to go bust eventually, you just watch,” says the typical broker from Grimsby, holding court and describing the 1934 market cycle. “The model is simply not sustainable and it definitely does not treat customers fairly.”

It’s a commonly held view: you’ll have heard it 56 times a week. And it’s not just our regional broker who says it, it’s everyone. Wishful insurers, market analysts, industry grandees, mouthy journalists, jealous jerks and even, dare I say it, me. But it doesn’t reflect reality. Yes, the consolidators are having a bad time like lions with sore tummies after a feeding frenzy. The economy is hurting, but it is hurting everyone. And the growth anticipated is being realigned with the expectations of twitchy investors.

But all in all, consolidators are here to stay. The personalities may change and the clients may move around a little. But super-regional brokers are to be a permanent fixture and they’re going to need to be propped up by someone. Perhaps the regulator, post-­­general election, will have a say. The market may be at full stretch. But next time the doomsayers are zapping your energy, just look at where the money is being held in this market, and be assured that things are relatively less volatile than two years ago. Albeit, not by much.

Hiscox heads the brokers’ benchmark

This week we publish the commercial lines results from our annual Broker Service Survey, the most comprehensive benchmark of insurers’ service to brokers. Hiscox has come in the top slot for its service to brokers in commercial business, closely followed by last year’s number one, Chubb, and underwriting agency Arista.

The results also showed good improvement by some insurers: AXA’s and MMA’s overall service scores improved the most compared to last year. We’ve also expanded the survey. Our commercial lines league table has been extended to 31 insurers from the 20 covered last year. For the results in full and analysis by Michael Faulkner, see pages 14-15. IT

tom.broughton@instimes.co.uk