Markerstudy chief outlines challenges over salary expectations and broker telematics

Smart Driver Club Insurance was a telematics broker, with its own insurance panel, when Markerstudy acquired it in 2019.

Wall, pictured, who joined in March last year as head of non-standard reporting into Gary Humphreys, was given the task of looking at the business and assessing its development potential.

He concluded the telematics market was ‘really tough’ right now for brokers.

Not only do brokers have to pay the price comparison sites an arrangement fee, they have to reduce their own commission to then lower premiums and win the customers.

This means the margin brokers are working on is very challenging.

He added: “We just thought the commercials did not make sense to try and compete in that area. Everybody in the industry knows the motor market is not easy right now and trying to get commission is a challenge.”

As a consequence, Wall said the Smart Driver Club Insurance brand has been passed from his non-standard team to the group’s broking division.

Wall was previously chief executive of Fresh from 2018 to 2020. 

Recruitment

Following his appointment by Markerstudy, Wall initially planned to recruit 12 staff to develop non-standard home and motor. 

However, he discarded the target amid recruitment challenges and now intends to focus on existing staff. 

“We had to knock it [finding a team of 12] on its head immediately because of salary expectations. We must focus on who we have already because if your people are good and you lose them, then it is difficult and costly to replace them,” he said.

“We are trying to use the technology and the people within the group that are already here to make this work. I did bring in a couple guys and we’re using the existing underwriting team with Markerstudy and the existing people within the retail division to help with our offerings.”

Wall said it was a challenge to find people who understood non-standard insurance and telematics.

He added: “The two staff members I did bring in have got around 50 years combined experience in telematics and non-standard. Non-standard business is not something you can sit someone in a classroom for two weeks and expect them to be ready.”

Perfect storm 

Wall said the aim this year was to remain profitable amid ‘perfect storm’ market conditions. 

He said: “In 2023 we just want to make sure that we write sufficient policies and be a profitable business.

“Pricing sensibly for customers is also a challenge that we want to focus on. It is the perfect storm at the moment because you are at a time where insurers’ combined operating ratios are as bad as I have ever seen in 40 years and you are asking people to pay a rate that they don’t have the money for.”

He said striking a balance between the customers’ interests and profitability was the key. 

“The customer comes at the heart of all things we do, but the business has got to make money too. That is the reality unfortunately, customers have got to be happy but also the people who carry the risk,” he concluded. 

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