DNA Insurance’s directors Alf Costa and Danny Imray tell Andrew Pearce why broking is still all about meeting clients face-to-face and how their specialism in non-standard motor has helped it thrive
▶ How did you both get into broking?
Alf: My journey was quite simple, I left school at the age of 16 and my first job interview was with a local broker. I’ve worked on both sides of the fence, for brokers and insurers, so I know how insurers think and why they do things.
Danny: When I left school I wanted, believe it or not, to be a barristers’ clerk. After numerous interviews it didn’t work out and I saw an advert in the Evening Standard for an insurance broker. It was an offshoot of Allen & Allen in North London. I didn’t know anything about insurance, I just went in for the interview and said: “I’m going to be the best salesperson you’ve ever had and I’m going to beat all the people you’ve got.” The lady actually believed me and liked my enthusiasm, so she gave me a job.
▶ DNA has is now 10-years-old, how was it established?
Danny: We’d been putting the business plan together for a number of months and decided to make the jump. It was quite a nerve-wracking experience because I sold my BMW convertible for a rusty Rover 214, which cost me about £200 and I also re-mortgaged my flat. I was 28, so that was everything, but to me it wasn’t going to fail because I don’t fail at anything. In the worst-case scenario if I had to live in a caravan I would live in a caravan. [Yet] in our first year of trading we wrote gross premium of £2.5m.
▶ What are DNA’s main lines of business?
Danny: We started out in car and van and, as we grew, we moved into private and public hire taxi insurance. We wanted to grow all of them aggressively. [But] we then decided to consolidate. We shut down car and van so, for the last four years, 90% of our income has been delivered by taxi and motor trade. It was right at the time to move down to two products but now we want to branch out again. Our main lines moving forward will be private car but niche market non-standard, so Japanese imports, young and convicted drivers. You can’t be all things to all people, there’s enough business out there to concentrate on the niche markets.
▶ How have you developed your specialisms?
Alf: It’s a combination of head-hunting via the usual routes of using agencies and people that you know in the market place. The reason we downsized was because in order to run a scheme you need people that specialise in these fields to move the product forward. It was finding the actual staff that can say ‘I’m good at this’ which was difficult. Now we’ve got a good team of people that specialise.
▶ What’s the ethos of the firm?
Danny: Without trying to be cliché-ridden, treat people how you expect to be treated. Insurance is still a people-based industry so, although you’re doing a lot of business on the phone and internet, the three most important people in our lives so to speak are insurers, customers and staff. Without staff looking after the customers and looking after the insurers you don’t have anything. We like to play and work hard so we encourage staff to have a laugh. We don’t want them to sit there like robots. Although we run a call centre-type environment everyone is a human being.
▶ Have you been affected by falling private car rates?
Danny: The market has always been tough, even 10 years ago people said you can’t make money in car insurance. Insurers have been programmed to say the rates are too cheap. The rate is what it is and that’s why we don’t want to chase the market. There is competition with the direct underwriters and we wouldn’t be able to compete. But direct underwriters don’t like the modified vehicles. They are not keen on convicted drivers, so rates for those non-standard niche markets are considerably higher and it enables us to have a more bespoke approach.
▶ What are the key ingredients to healthy insurer relationships?
Alf: It’s having regular discussions and meetings with them, understanding what they’re looking for and demonstrating what we can do for them. The key word is communication.
▶ Are you looking to expand into other specialisms?
Danny: Our growth stagnated over the last few years, and we are currently running at about £10m gross written premium. I would like to see us double in size over the next two years. We’re moving into new areas. We haven’t written real car [policies] in any anger for a while and the growth will come from car, van and property owners. We’re heavily committed on the property owners’ side. We see a lot of growth in that area as it’s got good retention rates. We’re also looking to work on cross-selling. If you look after a guy who has one van in his business then he gets two, three or four vans, you’re his natural person to deal with. Off the back of that there are commercial tie-ins for liability insurance, so there’s a lot of synergy.
Alf: You’ve got to give customers a reason to be loyal. If a client has got four or five polices with you then the aggravation of changing will be more compared with those clients with only one policy.
▶ What is your approach to social media?
Danny: [It’s] something we’ve been behind on but we’re now launching social media platforms where customers can interact with us. I’ve got every account going but [until now] I’ve not been a great fan. I’m a bit old school, I like to talk to people either face-to-face or over the phone.
▶ How important is your claims service?
Danny: Massive, we had some negative feedback [on a web forum] so I put a statement on there saying: “I’m the director and we’re a genuine company with genuine reasons to help customers – this is my mobile number and this is my email so before you do anything ring me. Let me fight [for you]. I will speak to one of our managers.” That’s helped us retain business and win new customers.
▶ How do you counter motor fraud?
Danny: We ID and credit check people. We don’t do buy online and we retain the right to write business as it enables us to weed out the fraudulent cases. We are part of a fraud group on motor trade along with [the likes of] Swinton, Covéa and Bollington. We meet up in Manchester every two or three months and chat about any fraud elements.
▶ Has motor fraud increased?
Danny: In the product lines that we do fraud is declining. Insurers and brokers are as switched on to fraud now as they’ve ever been. It’s been highlighted so much that everyone’s working a lot harder to combat it.
▶ Do you talk to customers every time before placing policies?
Danny: That’s something we may change in the future on low-risk products, but we will choose them very carefully and speak to our insurers beforehand to get their opinion. It’s inevitable that more products will be bought online so we want to be geared up to do it but not necessarily straight away. That’s why we’re building systems in the back end so that, if we need to, we can make the change without being light years behind.
▶ Which insurer do you rate the most?
Danny: Tradewise is one of our biggest accounts. In the beginning there was a bit of butting heads with procedures and there was a lot of conflict, but through communication and working with people you can build something that’s successful.
Some insurers can sometimes get the wrong impression of who you are and how you operate maybe from what they’ve heard or read. But, if you give people an opportunity, it enables the relationship to thrive. Some insurers can be too quick to say they don’t want to deal with you – ‘you’ve had one bad year and you’ve lost us money’.
If you’re married to the same woman for a long period of time, you’ll have rows and fallouts. It’s about working through the ups and downs. If you work through the bad times, when the good times come it works well.
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