What did you have for breakfast today?

Thumbnail image for Thumbnail image for liz blog icon.jpgI'm going to tell you something you don't know about me. Happy Gilmore is one of my all time favourite films. There are a variety of reasons why this is the case but one particular exchange never fails to make me chuckle. Evil, power-hungry McGavin attempts to intimidate Happy by informing him that his quest for victory on the greens is futile as, being the reigning golf champ, he regularly eats pieces of sh*t like Happy for breakfast. Non-plussed, Happy replies in mock alarm: "You eat pieces of sh*t for breakfast?" which leaves McGavin open-mouthed and looking rather foolish.

Why am I sharing this with you? Well because the subject of breakfast, the most important meal of the day, was used by Towergate mogul Peter Cullum to illustrate his main point when speaking at Insurance Age's inaugural  E-broking event this week.

Never one to beat around the bush, Mr Cullum warned the broker audience that if they continued to adopt a relatively laissez-faire attitude towards e-trading then the big bad aggregators would come and "eat their breakfast before they got up in the morning".

The relationship between brokers and aggregators is not a million miles away from the rivalry between Happy Gilmore and McGavin - a tenuous link I know but they certainly both wanted to win the title.

Since the birth of direct writers, comparison sites have fought equally hard to make their mark in the personal lines arena and have consequently made life extremely painful for brokers. They have used technology to give the people what they want - no fuss insurance in the shortest possible time.

But this may all be about to change (not that anything happens that quickly in the insurance industry but allow me a bit of drama if you will).

As a rather emotive thread on our broker forum suggests, the FSA's move to get "less soft on aggregators" may finally go some way in tipping the balance back in favour of the humble broker.

Brokers have long criticised the aggregator business model which, it could be argued, flouts TCF by dishing out assumption-based contracts which let's face it are unlikely to be read let alone understood. If the FSA starts to question what the difference is between advice and arranging then aggregators may be left in a rather uncomfortable position.

And even if change doesn't come from the top down, insurers are starting to change tack. When faced with aggregator loss ratios that are 50% worse than intermediated sales, it is little wonder that certain providers have been eating a slice of humble pie in an attempt to win back broker favour in personal lines.

So the big question is, will brokers get to eat their bacon and eggs? It is a tricky one as the current situation could go one of two ways. It may mean that brokers enjoy a renaissance in personal lines which allows them to sleep in and still have time for a full English. Alternatively the pressure may result in comparison sites working even harder to adapt and maintain their hold on the market.

 If it were up to me, I would probably still set the alarm.

 

 

 

 

 

 

 

 

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