Broking to the future: Hayes Parsons’ managing director James Woollam tells Insurance Age why encouraging young people into insurance and investing in technology are key for the sector
▶ When was Hayes Parsons first established?
Hayes Parsons has been around since 1964. I led a management buyout in 2015. We have over 50 years of history and experience and some clients who have been with us for almost the whole period of time. But in many respects we feel like a company that is only four or five years old, so I think we’ve got the benefits of both.
▶ How has the firm grown since then?
Over the last five or six years we’ve doubled in size. A lot of that’s through organic growth. We’ve been quite successful at growing the business and we’ve done that through really understanding client wants and offering a client proposition that encourages lots of customers to come to us. Last year, we made our first acquisition and that was a really exciting point for us, helping us to reach the next stage of our development. We bought a managing general agent that does boat insurance, Admiral Marine.
▶ Do you think marine is a growing space?
As a business, we’re very into specialising and we like to find areas that we can really get under the skin of and fully understand. We have to really know what they’re doing, what their risks are and work very closely with insurers who understand those risks. We have a few different specialisms within the business – one of those is the marine side and, when we came across Admiral, it was a very natural choice to acquire them.
▶ Which insurers provide the best service? How?
We have a panel of insurers that we work with – some are better than others. Our concern at the moment is that, whichever insurer it is, whether it’s one that we’ve got a relationship with or not, there seems to be a real move away from offering personal service in the regions.
We get pushed to big hubs and online. That move towards the online side of business is much more to do with cost than it is to do with providing a good service and that is to the detriment of both brokers and clients. Yes, we have insurers that we work closely with, but whoever those insurers may be, I think there’s a service issue.
We’re very into specialising and we like to find areas that we can really get under the skin of and fully understand
▶ How do you think the industry could improve?
There’s an ongoing challenge with getting young people into the industry and, whilst there are some companies talking about ways to get young people in, I don’t believe we have actually managed to crack that yet. If you compare us to other industries such as solicitors and accountants, we haven’t yet sold a compelling story about why insurance could make a really good career.
In terms of the online side, at the moment, insurers are using technology online and digital to cut costs – it’s not being used to provide a better service. In order to really understand what that means, we need to look outside of insurance and look at other industries like the airline industry where the online offerings are in a different league compared to insurance.
▶ Do you think education is the right way to go to entice more young people to the market?
That’s a good step – it’s positive. However, fundamentally, we’re actually driving too far towards qualification and not selling our industry as a compelling, exciting, really important industry for young people.
While some people are making advancements in this, you still don’t go to schools and colleges and hear people talk about wanting to go into insurance. You get an awful lot of people in insurance who say the words ‘I fell into insurance’ – I’m one of those, and we look around and smile at that adage, but I don’t see that as a positive. I want to hear people say ‘the reason I came into insurance is because of the opportunities I was given, its importance to the UK economy and because you can go into insurance and really make a difference’.
▶ What’s your opinion of the Financial Conduct Authority (FCA)?
The FCA has a lot of challenges. A lot of our regulation comes from Europe now, and Europe has a different regime to us. They don’t have the broker system that we do, so a lot of the regulation doesn’t feel relevant to the independent broker. That creates significant burdens on the smaller firms, which is a challenge. I don’t see much of the regulation that comes through the FCA really protecting consumers, which is what it should be doing.
▶ What are your thoughts on unrated insurers?
Hayes Parsons, as a specialist insurance broker, will not use unregulated insurers – we think that’s the right thing to do for our clients. Having said that, I do understand, particularly in the current market, that there will be some incidents when you have to use unrated providers. When that happens, it is incumbent on the broker to explain why and what the implications are. The real issue is when that explanation does not happen.
Brokers that use unregulated markets pay the same reglatory fees as those that do not. Those businesses that are willing to use unrated insurers should be paying more, but that would require either our trade organisations to stand up and say that, or for the FCA to make those rules.
I want to hear people say ‘the reason I came into insurance is because of the opportunities I was given, its importance to the UK economy and because you can… really make a difference’
▶ What networks and/or bodies are you part of?
We’re a member of the British Insurance Brokers’ Association (Biba) and we’re chartered, so obviously we have a relationship with the CII.
I’ve seen a lot of change for good in Biba in the past few years. They are definitely upping their game in terms of the work that they do and the assistance that they give brokers. My frustration with them is that I feel that there should be a way of gold-plating the brokers doing things the right way or a disciplinary process for those that aren’t doing things properly.
▶ How do you plan to digitally transform in the future?
We want to use technology to mean that our clients have different channels to speak to us and be able to talk to us 24/7 if they want. Hayes Parsons announced two months ago that we were partnering with a technology company on the next stage of digital transformation to offer quote and buy systems to our clients. It will be much more than just a basic transaction – we want it to be able to assist and pre-empt their questions and also help with risk management.
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