Why a Network
In recent years the overall number of Insurance Brokers has been in decline.
Brokers have tended to be privately owned businesses; mainly founded before 1985. The Principals of these firms have now reached – or are reaching – retirement age.
Unsurprisingly, when these individuals are approached by larger firms with a view to acquisition, they are often open to the suggestion and – in the first round of mergers – their old offices and the local staff can remain in place.
However, we are now into second and third round ‘consolidations’. The original acquirer is purchased by an even larger broker; who is then bought by a bigger one! Local presence and client servicing can then be sacrificed in the interests of regional centres and rationalisation.
The client-base and the staff are thus being bought and sold more than once. So, the outcome of this sort of ‘consolidation’ is that nobody quite ends with what they signed-up for.
The upside of ‘consolidation’
Insurance in the UK – beyond the realms of private car and simple home/travel/pet insurance – is still predominantly arranged through brokers; and so it should be, because brokers represent the interests of the client in the best light to the multi-national corporations that are the insurers.
Generally, the larger the broker is, the better the deal they can achieve for their clients and for themselves; and the better the level of service they and their clients receive from those insurers. This is simple bargaining power and economies of scale etc.
An equitable sharing
It is incumbent upon the broker – and required by the FSA – that the benefit of any muscle they may have is shared with the client. TEn firmly believes that one of the things the client most needs and desires is proximity of service and the ability to deal with the professional advisor of their choice.
In respect of this re-introduction of choice – and in other aspects – the TEn approach runs counter to the prevailing trends in the market.
So why a network?
Since 1985 (and until TEn emerged) the number of start-ups in the broker market had reduced to a trickle. Firms that have been ‘consolidated’ have not been replaced by new entrants; the next generation has not been able – for a variety of reasons – to emulate the entrepreneurship of the one that went before.
TEn was established to level the playing field for smaller local brokers and broker start-ups; and for the clients who preferred to deal with them. Consequently, we have the arrangements with insurers, as would a large national broker, which our membership has access to.
TEn also provides a range of back-office services to its members, as any Account Executive within a larger broker would expect to have. Therefore, any client can choose to deal with a local broker; without compromise.
see here
the network of brokers
Appointed representatives
In the parlance of the Financial Services Authority, we are deemed an Appointed Representative Network and the brokers who have joined us are our Appointed Representatives.
What this means is... that TEn is the entity that is “authorised and regulated by the Financial Services Authority” and the Appointed Representatives are in turn regulated by TEn, having been appointed to represent us in respect of our arrangements with insurers etc.
