Insure TV Masterclass: What’s next for Broker Personal Lines?

Mark Colegate: Hello and welcome to this Insure TV Masterclass with me, Mark Colegate. We are looking at the opportunities and the challenges for personal lines in the year ahead. To discuss the topics I'm joined here in the studio by a quartet of experts. Let's meet them. They are Jonathan Santer, Managing Director, Broker and Partnerships at Aviva. Jackie Basham, Director of Insurer Relations at Howden. Darren Walsgrove, Personal Lines Director at Everywhen, and Tim Rourke, Managing Director and Head of UK and Ireland for PPCU Consulting, part of WTW. Let's start by finding out a bit more about our panelists. Tim, tell us a little bit about PPCU Consulting and where does it fit with the personal lines ecosystem?

Tim Rourke: Yeah thanks Mark. So our consultancy business advises many Personal Lines insurers and brokers across the UK, from anything from strategic work to helping them with their kind of AI and data science. So we work across the whole range of different areas and I'm very privileged to be able to know lots of different people in the market and get sort of that broad sort of overview of what's going on in the UK.

Mark Colegate: And Darren, tell us a bit about Everywhen and what percentage of that business overall is personal lines?

Darren Walsgrove: Everywhen is a consolidation of Towergate and Ethos, the brokers that over the last five years have been purchased and are now coming together under the new brand. It's a business which is 90% commercial and 10% personal.

Mark Colegate: Thank you. And Jackie, as Director of Insurer Relations at Howden, tell us a little bit about what you're doing in the day job and what are some of those issues around personal lines, both opportunities and challenges?

Jackie Basham: Yeah, so Director of Insurer Relations. I'm very similar to Darren. I head up on the personal lines distribution for Howden. We have various pillars within the Howden group and obviously the area that focuses on personal lines is our consumer and local commercial pillar. So I work heavily in the market with insurers. I've been in the marketplace, first job straight from school. I've run my own brokerages before and also worked for other insurers. In the Howden world currently, very similar to Darren again, we have obviously lots of different brands and names coming together. Some of you will have recognised A-Plan previously, Aston Lark, a couple of our core brands which have now moved into the Howden brand. And we've been going through a very big period of change over the last couple of years whilst that's all been really occurring as well.

Mark Colegate: Thank you. So lots of consolidation going on there. John, tell us a little bit, I mean obviously with personal lines, it's a huge area. So which parts of the personal lines market is Aviva in, which bits does it want to be in?

Jonathan Santer: So Aviva currently has a very broad range of distribution right from direct, PCW in our retail business, but then also a lot through intermediated channels. So we have just shy of £2 billion worth of premium and that's in the intermediated space and that's across a range of regional broker distribution, through aggregator specialists and volume market brokers, through delegated arrangement schemes and other delegated authority relationships and obviously our bank partnerships as well. So it's a really broad range, a broad spectrum across that distribution. In terms of where we want to play, thankfully all across and we're very much committed to all of those channels that we trade in currently.

Mark Colegate: Well, I mentioned right at the start it's about challenges and opportunities. So from your perspective as an insurer, what are some of those challenges and opportunities that you see for the year ahead?

Jonathan Santer: So I think as I look forwards, the market's at a really really important point at the moment where to play on the themes of consolidation earlier, I think we're starting to see the effects of that really start to bite. And as a result of that we're starting to see, both in the insurer space and the broker space, a polarisation of those markets who are going for scale and volume to essentially reap the benefits of the economies of scale that that brings, the sort of contribution to fixed expense base or the additional data or whatever it might be. But then at the other end of the spectrum, those who are really fighting to specialise and acknowledge the fact that if you're not able to scale, you end up being in the squeezed middle which is quite an uncomfortable place to be. So I guess as I see opportunities ahead into next year, whilst that's a challenge for our individual business models, actually if we can pivot towards being able to service our distributors at whatever end of the spectrum they're at, that's a really important role for us to play for our for our partners going forwards.

Mark Colegate: Tim, can I bring you in and get your, again, just a headline level some of your thoughts around opportunities and challenges?

Tim Rourke: Yeah, I would agree with John. I mean it is a very interesting point in the market. You've got significant consolidation, you've got four very large personal lines insurers that are getting bigger. And what that means, what that means for distribution, you know, what does that mean around prices, what does that mean around, as you say, those fringe players and how they compete effectively with some very large insurers that will have expense advantages. So I think what I would be interested to see in the future is how outside of that core those different players react. And then when you look at things like GIPPS and what that does as well to prices and the fact that you might be getting more stability, what that means for aggregators, what that means for the broker channel and for the direct channel. So all of these things combined leads to a very interesting few years as the consolidation happens and beds in. And then what these organisations do once they've done that consolidation and they're ready to kind of fire on all cylinders. So I think it's a very interesting time in that sense.

Mark Colegate: Which let's stick with the consolidation amongst insurers themselves and specifically what that means for brokers. So, Darren, let's come to you on that first of all. What sort of challenges does that throw up for Everywhen?

Darren Walsgrove: It's really reduced the options for the client. You'd get difficult quotes where you'd have three or four companies fighting for that one risk. Now you get a difficult quote and it's one company. So our choices have been reduced dramatically over the last couple of years, and it has made placing risks more difficult and it's our concern, and I'm sure Jackie is exactly the same, our big concern is one more consolidation in the insurer market would have a really big effect to our businesses.

Mark Colegate: But what about to to John's point that you might, you've got some people who are doing scale and then you've got others who are doing specialism. Why is somebody not saying, "Sure, if you go to the big four, there's not as much choice but if...

Darren Walsgrove: ...you're getting a better deal because there's more business". I'm not, I'm not so sure. I think specialism is really important in our business, but what we do have to do, we have to solve everything for our clients. We have to be able to insure a standard vehicle, a non-standard property, a high net worth property. We'd love to specialise in one particular niche, but I think the way we have to work, especially for our commercial colleagues, is to be able to satisfy all their clients' needs.

Mark Colegate: Jackie, your thoughts?

Jackie Basham: I would agree with that to be fair. I mean, at the end of the day, I mean we have over 130 branches across the UK. And you don't go into a Howden branch just to buy car insurance. You go in to have all of your needs met as a client. That could be personal lines or it could be commercial, it could be other areas of the Howden pillars that we work with, like our employee benefits, it could well be life, it could be pensions, it could be mortgage advice and that sort of thing as well. And that's why we sort of focus in the branch network, local commercial. Local doesn't necessarily mean small. It means that we can fit whatever our clients' needs are. So, very similar to what you're saying, the core space in the insurer market, there are the four big players. Some of those big players don't go into the special lines that we would deal with, so you have to work with other partners. And that's it for me. It's all about partnerships with people that are looking for your particular needs, a bit like you were saying about multiple product lines and stuff. We would be very strong in the classic car market, specialist niche areas that we'd be writing in. So a core market just dealing in standard cars or standard home works, but we need other partners. And that's why Aviva works, because Aviva works well for us on private client division, which is a very big area for Howden, as well as the standard personal lines and some of the niche personal lines, which is great, because not everybody does that to be fair.

Mark Colegate: Thank you. John, if there's less competition at the core, what does that mean for pricing? Could somebody say it's great news for those that are left, you've got a sort of, if not monopolistic position, but you know, very close to a duopoly?

Jonathan Santer: I would say the competition has absolutely not abated. If anything, it's just become ever more fearsome. And whilst there are four, I mean, I'd probably say five, but yeah, four lead personal lines insurers out there now, as Jackie also alluded to, there are many more out there. It's absolutely not moving into any form of a dominant position.

So, I think in terms of prices, I've never known the market more competitive as it is now. And particularly, as we've seen both the impact of specialism and those levering of the advantages of scale and the sort of additional data and the data enrichment sources that are available, the innovation in this space just continues to thrive and thrive. And all of that added together actually still gives customers quite a lot of really sophisticated, and when I mean sophisticated, I mean cheap and tailored for their specific risk profile, gives lots of options still.

Mark Colegate: And when we're talking about this, consolidation personal lines market, is that because fewer large insurers want to be in personal lines, or is it a consequence of other M&A activity that's going on?

Jonathan Santer: It's an element of both, Mark. So I'd say first of all, I mean we, we as Aviva ourselves, have recently undertaken a significant acquisition with Direct Line Group, and that was a very much deliberate effort as we seek scale and actively look for the advantages that brings.

And I'd say, you know, we’ve seen a number of market exits, unfortunately within personal lines insurers over the last couple of years. And whilst I can't speak for them, I would say as an outsider looking in, I would say that they concluded it was not particularly commercially attractive for them to continue distributing through that channel, unfortunately, as a result of the increasing pressures that we've seen, whether it's the increased expense, the regulatory oversight, or just that fearsomely challenging rating environment where if you're going to play in the mass market distribution space, you absolutely need that scale and data to back it up.

Mark Colegate: Thank you. Tim, can I get your thoughts on that, and then let's bring in Jackie and Darren

Tim Rourke: Yeah, I would agree with John. It's really difficult to provide personal lines pricing at the level that is required by insurers, and as you say, the regulatory oversight, the challenge of data, being able to do that is very difficult, and a lot of players have left the market. I don't think that's going to become any easier. And I agree with John that the competition hasn't actually decreased. I think that it will, if anything, become more competitive, as you've got these large insurers looking to really sort of get the business on very, very fine margins, and very marginal price changes will make a big difference. So I think that's really an interesting area. So what will be interesting, I think, is what happens around the outside, the fringes, and that's not small market. That's just, you know, if you look at the broker space and the affinity space, and how that becomes more buoyant and fertile, potentially, as the core is mopped up by these very large personal lines insurers that are pricing to, you know, absolutely five decimal places. That, that's another, again, an interesting area where the broker space has an opportunity to thrive, I think.

Mark Colegate: Thank you. Jackie, let's bring you in here. We've touched on data a couple of times. You at Howden must have huge amounts of data on your client base. So how do you match that up with –

Jackie Basham: Well, obviously we have a, you know, we have a million clients. And obviously within the consumer local area where I'm working, so effectively we have a strong demographic: younger drivers, older drivers. Our book or our profile of customers generally tends to be slightly more mature clients. And we work very heavily with our partners, such as Aviva, sharing our data on our clients, so that we're able to look at some unique data that maybe Darren's business wouldn't. We would know proximity to our branches, where they would fit, how they buy, their buying habits with us, how long they've been with us, lots of different data that we would share. And then our actuarial and pricing team would work very much with John's, and together we would come up with the best quality products at the best price that we possibly could. However, going to a Howden branch to buy a policy is never going to be the cheapest, because we're all about quality. We're all about the client and we advise them. So advised sales in our world is the key area on which we focus, which again is an area for you. But fundamentally, we like to sit down, chat to our clients, and really understand their needs and requirements so that we can make sure we're fitting the best policy at the best price we possibly can, but never cheap.

Mark Colegate: So ultimately, would you say you're offering in the case of Aviva, an Aviva product with distinct Howden characteristics, or it's basically a Howden product and Aviva you've plugged in to do some of the work around the back?

Jackie Basham: It would be an Aviva product that we would be offering. However, there would be differentials on what we may be able to offer in a Howden world compared to other brokers that John may well be working with. And again, from an Aviva product, for us, that would be as I touched on earlier, private clients, high net worth, your standard car, might well be your taxis, your motor home business, and that would be through an MGA capacity area that John would be working with with other partners. So we're joined up in several different areas, but the uniqueness of our data, we would share to try and make sure that we could maximise those opportunities together.

Mark Colegate: Darren, what would they take at Everywhen, which obviously is more of a platform based than -

Darren Walsgrove: I don't think we're quite at the level of Jackie with sharing data, but we are moving in that direction. A lot of insurers want to look at our data and find bespoke ways of targeting more of our clients. And with our systems, we can adapt our premiums, we can build in rules, we can make changes but I agree with Jackie, I think if we're going to compete against the online aggregator sites, we aren't going to win on price. We need to win on service.

Jackie Basham: But we don't want to win on price.

Darren Walsgrove: No we don't.

Jackie Basham: Because we're trying to provide something completely different. 

Darren Walsgrove: We need to be price proximate. We don't need to be cheap. We just need to be able to offer the client a better service than they would get online. That is our goal.

Mark Colegate: But on that price point, how do you actually go about proving value for money rather than that you provided policies on cost?

Darren Walsgrove: Yeah, I think Jackie's point on an advised sale is important. We're here to give our clients advice. We want to make sure they're insured correctly. They've got the right product for their needs. You know, we're there in the event of a claim. If somebody needs a home visit, there's a fire taking place, people in their worst position, we can be at their house, we can be visiting, we can talk them through it. It is always helpful to have a broker in between the insurer and the client. It adds that layer of protection for the customer. And I think there's a value in that.

Mark Colegate: Tim, I wanted to bring you on this issue about the relationship between insurers, brokers, and the data and how much bespoke can you do?

Tim Rourke: Yeah, I think it's very important. It's something that has been done in the industry for many years to varying degrees of success actually, which is the relationship between the insurers and the brokers. And I think that now given the consolidation, given that the market is in this state of change, that relationship being harnessed and maximized, I think it's going to be really important. The other thing sort of following on from Jackie's point is around unique data and I think again in the world of consolidation where prices are going to really be condensed as the market sort of understands those risks, unique data might be something that is even more differentiating in terms of pricing. So it's something that I would be very interested to see how that relationship kind of strengthens in the future between insurer and broker.

Jonathan Santer: I'll come in on a couple of those points as well, actually, Tim. So firstly, building on the theme of partnership. So it's not just the unique data that is incredibly attractive for us as an insurer partner to work with brokers. That's incredibly important in terms of how we differentiate our rates, but that advice as well that is played over the top brings a different customer base to us that is particularly attractive and not one that we would necessarily be able to get through our alternative distribution channels. And on top of that, the wrap-around service that brokers provide for customers is something that really tremendously adds value and I think as part of the overall offering in partnership, that's tremendously powerful.

Mark Colegate: So Jon, given what we've been talking about these trends, I mean, how do you see the business model at Aviva evolving when it comes to personal lines? Because you almost, don't want to put words in your mouth, but it almost sounds like you're going to be a collection of specialisms rather than sort of one or two core areas of what we talked about.

Jonathan Santer: I quite like those words. That's a really good way of describing it. So one of the challenges is when you're trying to be all things to all people and you end up spreading yourself inadvertently too thin, and without real focus and bringing in experts who specialise in a particular area, it's very easy to move into a particular segment of the market and not do it particularly well. So we've undertaken quite a lot of work to really think about how we target certain segments and setting ourselves to do it properly with the right level of focus and investment and the systems that underpin that to enable us to win in those markets. So right across the spectrum of distribution, we've got trading teams who are set up to do the in-the-moment pricing, the continual iterative changes for those in the more price-fighting competitive spaces, we're set up to do that. In our schemes world, where it's slightly slower, but actually very much more about understanding those nuances of the customer, we work hand in hand with our broker partners and we're set up, across our distribution colleagues and our schemes pricing specialists, to be able to iterate our approach and develop and continually keep that proposition moving on. So just a couple of examples, but in each of the spaces we play at, we've actually got a very honed business model that underpins how we approach it.

Mark Colegate: Thank you. We've talked a lot about the consolidation amongst insurers and what that means for brokers. But within brokers themselves, are there any particular challenges that consolidation throws up? So, Darren, if you onboard some more firms onto the platform at Everywhen, how quickly can you connect up all their data so that you as Everywhen can go to Aviva or whoever and say, "This is the characteristics."

Darren Walsgrove: That is a really good point and we are making big inroads to try to get one pass system, everything together, all the data in one place because that's one of the biggest challenges: an insurer will ask us for information, we've got to go to seven different places to pull that together to get them information. So there's a really big push at Everywhen to get everyone on the same system, everybody operating in the same way. And when John needs data to ask a question, we've got that at our fingertips and we are close to that.

Mark Colegate: And Jackie, from your perspective, I mean, I'm not suggesting every broker should join Howden or Everywhen or a particular platform or network or insurance broker, but when you're having those conversations, how important is it the state of their data before you can even take the conversation any further?

Jackie Basham: Yeah, I mean, obviously M&A is very strong in our world. We look at it by various pillars within Howden Group, as would it fit commercial, is it more the personal lines brokers? We've seen with the consolidation of some insurers, more smaller brokers looking ready to sell their businesses over the last 18 months. Probably linked I'd say with, you know, regulatory requirement change has had a big impact on the people. And, you know, from our M&A team, we would go out, we would look to see - does it fit our business model? In the main an aggregated sort of broker, very price sensitive, wouldn't necessarily fit our sort of like platform. So we have a tendency to buy more local brokers who are fairly, you know, small, but again, some larger partners that we would be picking up along the path. And for us, it's all very much, they may well have an agency base of, I don't know, maybe 100 agencies because they're desperate to be placing business. Whereas from a Howden point of view, we have our key partners that we would work with. So it's all about consolidation of the broker into Howden and then Howden consolidating to our insurer partners. But the data is key. But obviously we would be very similar to you, Darren, we're advising. So as those clients move into a Howden world, we'd be touching them, we'd be feeling them, we'd be chatting to them, we'd be making sure that the data that's coming in to us from a client perspective is what we expect it to be and understand so that there's no concerns about the data being wrong when we're trying to maybe re-broke that client across our panel.

Darren Walsgrove: Yeah, I think it's slowed down for us. I think we're going through a period where we want to consolidate those businesses and get them into the Everywhen way, rather than running separate businesses around the country. And it's really important that the people in those businesses come on the journey with us and understand that we're all doing the same job. We're regional broking. We want to deliver the same things as they were delivering. We just want to make it more efficient, get better premiums from our insurers and like you said, Jackie, consolidate the books down to a sensible amount of key partners rather than lots of, when - we've all been brokers before, you would open an agency to place one risk when we started, and now we're in a position where we want to consolidate that to a few.

Jackie Basham: And like I sort of touched on about the regulatory requirements, if you have a very large panel, the amount of work involved in terms of like the product governance side of the business that we all have to get involved with, you know, which is key, but again, if you've got like a small book of business and it's a tiny amount and you can replace it to a core panel member it's the ease of process for us and I'm sure that's -

Darren Walsgrove: And you improve the pricing for the client, you improve the flexibility you can receive from that insurer to be able to give the client what they need. Yeah, it's a win for customers.

Jonathan Santer: And we've absolutely recognized that as an insurer as well. So within the, particularly that regional broking space where you see those more sub-scale brokers, it's a significant market opportunity for us, but recognizing the pinch whilst we'll continue to invest for those brokers who want to divest, we'll also be there to support. So we'll provide support and advisory services through our relationship management teams. We'll also even have a look at potentially providing a solution to pass on those customer relationships to us directly as well. So again, as we're thinking about how to respond to this, we're serving up alternative options for those brokers.

Mark Colegate: Tim, in this space, we talk about consolidation of brokers. I mean, are you seeing any particular trends or perhaps without giving away confidences, any examples of people who've done this, I'm sure particularly in terms of data, you can either do it well or quite badly.

Tim Rourke: Yeah, there's a couple of comments I'd make. One is, one of the things that I have noticed working in the industry and it seems to become more and more prevalent as the years move on is complexity. And the regulatory burden, the complexity burden around data, technology, pricing, governance, control gets harder and harder every year. And when you think about what brokers and insurers are trying to do, which is actually extremely complicated. I don't think that necessarily people realise how hard it is to actually deliver an insurance product to the population. I think that that is becoming quite difficult. So manoeuvring that, being able to be efficient and effective in that complexity, in this world of complexity that we're living in is something that I see more and more. Around data, again, there is so much opportunity with it. I think that again, it's used in varying degrees. It's not easy to get unique data or unique sort of information that's going to make an appreciable difference to your pricing. So as much as it is an opportunity, it's still really difficult to achieve. So, yeah, not easy, not easy. And that's the general sentiment that I pick up in the market, that there's no easy yards in insurance at the moment.

Mark Colegate: Thank you - just sorry, a very broad point - I hope it's not a foolish question to ask, but John, what's the difference between data that's useful rather than interesting in this space? Because everyone's got lots of data. So what really does make a difference if Howden comes to you and says X percent of our clients have got Y characteristics?

Jonathan Santer: It's a really good question which we spend as a team a lot of money trying to investigate and answer, both in partnership with the data suppliers that we have, whether it's from brokers or external data providers, but also within our analytics teams as well. So broadly speaking, we'll ingest a number of different items, it'll go through a rigorous onboarding governance process, more governance, Tim, to check that it's going to be used in a legal and morally correct way, etc, etc. And then essentially what we'll do is we'll flash that against our own data experience to see if it is genuinely predictive of future risk based on what we've seen in the past. So we've seen the strangest of correlations, particularly with machine learning tools to help us rate as well. We're able to start to see predictiveness between data items that you wouldn't have otherwise necessarily thought would be correlative. So it's a really exciting and interesting space for us. I'd also say that some uses of data, for example, might be more useful for brokers than insurers, and the age-old example might be premium finance. It's good for brokers because of the ancillary income that that revenue stream brings in when a customer buys it. For an insurer, it might represent a worse underwriting risk. So actually, we need to work in partnership to understand how use of data items like that might not compete with each other because what we're looking for are optimised models where we're actually working together to generate a more competitive customer quote that is sustainable in the long run for both of us as opposed to really fighting for each other for particular elements of the value chain.

Tim Rourke: I think that's an age old problem, John, actually, isn't it where what is profitable for brokers is not necessarily profitable for insurers and getting that harmony so that both work together feels again something that in this market where there is consolidation, there's less insurers on a panel, making sure that the ones that you do have really do gel and work together end to end.

Jonathan Santer: Absolutely, but that's again a real really pronounced shift over over the last couple of years, is that those brokers partners that recognise the fact that there is only a certain amount of value to be shared and the best way to go about creating the most competitive pricing for our customers is actually by having a grown up conversation about who's taking which part of it and who controls the various various elements of it to make it sustainable for the for the future.

Jackie Basham: I think it's very much multi-product as well. You know, we're sitting here talking, you know, maybe talking about car, home. We know a lot about our clients. They have multiple products. One of the key areas that we're, you know, focusing on as you'd expect us as a business is being able to deal with all of our clients' needs. So from a personal lines perspective into Aviva, you know, if they have a van, if they have home, if they have contents, if they have a classic car, whatever it may be. I think the data that we share about our clients is not just key about one core product. It's about the whole product offering. And I think that's an area where we could probably all get a bit closer together as an industry at the moment. And I think sometimes it's down to restraints with maybe software platforms developing that data or product offering that causes us all a, you know, maybe a little bit of pain on the go forward position. But ultimately that data, the uniqueness of a multi-product per client, per insurer would be a key thing to try and progress forward on, I think.

Mark Cosgrove: But would there be a problem from a regulator's perspective? I take your point, but if you sort of said to, let's say it's Aviva, actually I've got this client and they don't want that bit of personal lines, they do want this bit, they've got something a little bit exotic round the side but you cover that - and the regulator comes and says 'an awful lot of this business all seems to go through Aviva'.

Jackie Basham: Well obviously, we'd review our panel and obviously I think it's a bit like what Darren was saying, it's about fitting the product to the client and not everything is going to go always to one insurer and obviously we would be looking at the uniqueness of, you know, that particular client's buying behaviour, what it might need in terms of the product offering, and Aviva don't do a one-stage-fits-all, we have to - and that's the whole point of being a broker, we have to be diverse, we have to work with a panel, but I think if we look in, and particularly in like maybe the personal lines private car market, a lot of the direct writers have maybe moved forward with multi-product offerings, and I think in the broker space that is somewhat limited - 

Darren Walsgrove: It's an understatement.

Jackie Basham: Which is what I'm trying to sort of, you know, come back round to. So I think, you know, Aviva would be working on multiple car product offerings, other people would have similar products. We don't necessarily have any of that within a broker space, and the restraint is the software, so what I'm saying is, a go-forward position, I might not say to Jon right, 'it's the buildings, it's the content, it's the classic car', but if we've got a mother, father, son, grandad, multi-house offering, then I think that that's something that we could share our data on for a bit more uniqueness in the broker space.

Darren Walsgrove: And I think insurers are telling us that if they insure more than one product for a client, it has a big impact on profitability potentially. Jon, is that the case?

Jonathan Santer: No, I think this is actually another good example of a potentially competing interest. So where you own the customer relationship, the ability to look at cross multi-product holdings and the interplays between them and profiling the customer particularly from a sort of propensity to buy or a propensity to retain basis where you own that customer is a lot more powerful, so again it's another subtle differentiation between the broker environment and the direct environments where, the customer ownership sits in different spaces, it's more valuable to an insurer in one than the others. So, again going back to the point earlier around working in partnership, actually an open and transparent understanding of the value chain, what is valuable to insurers and brokers along that chain, once you start understanding that better, you can create a much more sophisticated and much more efficient pricing regime that sits around it.

Jackie Basham: And I suppose you've got to think about Aviva being diverse in the fact of, you know, we're here today to talk about personal lines, but we've touched on private clients and again, huge area of business for Aviva and their strong relationship with Howden again on commercial lines and, you know, other classes of business. So we're sharing quite a lot of data across Howden group into Aviva for our various aspects that we're placing business on. So I think the data sharing thing, whether it's just personal lines, commercial or other product lines - marine, maybe, you know, there's various things that you could look at - is key. And again, that partnership together is one size doesn't fit all. I'm not going to go to Aviva for everything because Aviva's not going to be able to fulfill all of my needs and then Aviva aren't going to want to come to maybe Howden or your business for everything because there'll be areas for example that you won't be in. A prime example on this and I'm just going to say it because I just, you know, would be young drivers, for example. You know, we all find the young driving market at the moment particularly tough. Consolidation of insurers on young drivers has probably been a problem for quite a lot of us to be fair. Aviva has a tendency to write its younger, real younger drivers through a direct model rather than a broker model, but I do appreciate you go down to, you know, certain ages, but I think that's an area for us whereas we might sit there and we might have a core piece of business that we would write with an insurer, we might have areas which we would refer to like the cold spots, which would be our younger, maybe our maturer end as well. And that's the areas that I think, you know, the partnerships with other people or Aviva or, you know, that could be closer together to be honest with you.

Tim Rourke: I think it's a good point. I think there is definitely something about how the brokers pick their segments. And so that there are just going to be areas where it's going to be extremely difficult to compete. That's not going to get any easier with consolidation and there's going to be certain segments that will just want that sort of more homogenised product. And then I think a really interesting thing about the industry is how insurers and brokers work together to pick the segments that they can be really successful in, and whether that be, clients want that additional service and that kind of TLC that you get through the brokerage, and I think that piece of work is going to be critical for success and knowing where you can play and when you can't play and being really good in those areas, I think it's going to be a -

Darren Walsgrove: I think as Jackie was saying there, as brokers who have got commercial customers, we get customers from 18 to 80, and we do need to be able to offer a proposition for all of them. I know our sweet spot, I agree with Jackie, is potentially 50 plus, is probably our place where we put business easier, but we do need a market for the 30 somethings. That is a challenge in our business. It always has been though, hasn't it? It's not something that we've ever been able to compete with. There's a particular direct insurer who was always very good at the 30 somethings, the late 20s, which Aviva works closely with now. That always took broker business from us.

Mark Colegate: We have got a couple of minutes left and we've talked through a huge amount, but actually my challenge to all of you is what haven't we touched on in this whole space that you'd like to get into the conversation? I'm going to start with you, Tim, and let's work our way quickly down.

Tim Rourke: Well, I'll be very careful in saying this, so that I um but obviously the advances that we're now seeing in AI. I think that, you know, there was the advent of machine learning and these advanced analytical techniques which John has touched on which are very useful in understanding the kind of relationships between data and risk, and they do that far better and far more forensically than ever before. I think AI is actually not just, you know, hot air. I think that we will start to see insurers and brokers meaningfully using AI, slowly but surely, in something that does actually create value. And I think that's around insight. I think that's around efficiency. I know people talk about this because, you know, AI is going to be changing the world, but I do see meaningful pragmatic value-add steps being used in the industry around AI and that's something that we should be aware of.

Mark Colegate: If you had to gaze into a crystal ball, do you think it will create more consolidation in the industry between insurers themselves and between brokers, or do you think actually this might open the market up?

Tim Rourke: No, I think it will have a different effect actually. I don't think it would impact that sort of consolidation in the market, but I think the way in which insurers and brokers will trade and operate will be will be changed eventually by AI because it will just provide insight and and things that can be done quickly and easily and the businesses will evolve to accommodate AI as well. I also think what's quite interesting is how the public will use AI, Gen AI and things like that when they're making claims or they're wanting to understand a little bit more about insurance and, you know, AI might empower the general public around, you know, their insurance dealings and I think that's another interesting area that I'll be keen to see what happens in the next few years.

Mark Colegate: Thank you. Darren.

Darren Walsgrove: I think as brokers, we need to really look at what the customer wants. I think there's a lot of times we're all, we all think we understand where this business needs to go and what we need to specialise in and what the customers want, but we need to listen to the customers. Some customers want to telephone us, some customers want to email, some customers want to use AI. And I think we just need to adapt, but also have a place for all of that. I like Jackie's model where, and Everywhen is exactly the same, we want customers to be able to come into the office, telephone us, email us, whichever way they want to transact business with us, we want to be able to deal with.

Mark Colegate: Thank you. Jackie, a final thought from you.

Jackie Basham: Yeah, so I think, you know, no change of direction here from a Howden perspective. Client is key. We're there to service our clients. It's an advised sale approach. We're there in the local market towns. We will always be there. The success of A-Plan before we rebranded over to Howden has been absolutely amazing. We're strong retention, strong quality products. I think from a client point of view, going forward, we've come out of a tough market and our clients, as everybody's clients would have been very heavily increasing on pricing. Retention strategy has been key to make sure that you retain your book and work with your partners. That's been one of our success stories. It's been tough, but we've achieved it. For me, as we go forward into next year, this year we've seen, you know, people try and maybe get some rate in. It's not been as successful as many people had hoped for. I think as we go forward into next year, I'm keen to understand John's view and an Aviva view on what he thinks the market's going to look like next year, particularly on motor and home.

Mark Colegate: John.

Jonathan Santer: Thanks, Jackie. So specifically in regards to the market cycle, we've absolutely been through a period of softening in both the car and the home markets over the last few months and I would anticipate that starting to turn into next year and certainly when I look at the claims trends, when I look at inflationary dynamics, I think that is going to be needed at some point. So from an Aviva perspective, we've very much focused on sustainable pricing to reduce some of that volatility that you might see in terms of year-on-year rate swings. And so our goal will be to manage that smoothly, but the anticipation is that rates will start to go up into next year. And other things that I would like to say, so just building on Tim's point, I thought his point around empowering the customer through use of AI is going to be really significant over the coming years. Our customers in their hands have the ability to essentially bypass potentially significant parts of our existing distribution chains. For example, how are PCWs going to be thinking, if a customer can just go find me an insurance quote and they don't need to go through a price comparison website, what does that mean going forwards? How are brokers and insurers alike thinking about optimising our models to be better found, better responded to, better interrogated by large language models and the like, to facilitate that. So that'd be really interesting. I will finish on one thing, which again we haven't really spoken about, but it is quite significant is the claims elements. So we're also seeing significant consolidation in the claims world and again, if I think about playing forwards, what that's going to mean, again, it's similar trends, it's going to be a real race for efficiency. It's going to be bringing the best of joint models together to bring the best for individual customers, whatever their needs, etc, etc. So I just have one eye out on what that means going forwards as well.

Mark Colegate: We have to leave it there. Thank you so much for watching. Just remains for me to thank our fantastic panelists here in the studio - Jonathan Santer of Aviva, Jackie Basham of Howden, Darren Walsgrove of Everywhen, and Tim Rourke of PPCU Consulting, part of WTW. From all of us here, goodbye for now.