The nationalising trend is being bucked more and more by major players in the commercial insurance industry, making professional liability insurance experts wonder if localism will be here to stay or just a passing fad.
A number of business insurance market players have been expanding their regional footprint in recent months in a bid to increase their local UK market share. It seems that, while the primary targets seem to be customers in the middle market, provincial providers also seem to be attracting Lloyd’s players with the hopes of specialising their regional offerings.
Mitsui Sumitomo, Liberty Mutual, and Axa are some of the recent firms that have made waves out in the regions. Axa Commercial’s intermediary and direct managing director, Matthew Reed, said that the firm is already conducting investigations into more possible locations around the UK that Axa could open additional branches in order to tap strong local markets.
Mr Reed said that it would be absurd to expect to trade locally without a local office presence, as the business is relationship-driven. Networking is key to Axa’s profitable growth and future trading, the managing director added.
Keychoice underwriting commercial director, Derek Findlayson, remarked that regionalisation is a growing force to be reckoned with and should not be treated as a passing fad. While it may be true that business acquired through regional brokers was historically more stable, if less profitable, the reality of the situation is that insurers have been closing branches over the past few years, Mr Findlayson also said.
Doing so was a gamble – albeit an educated one – that consolidation of broking firms was set to occur more swiftly than it has.