Brakes off on proposition convergence

If insurance were likened to an organisation that sends ambulances to the bottom of a cliff when people fall off, risk management would be the fence at the top of the cliff preventing it in the first place. And in brokers' quest for the Holy Grail of adding value for clients, many are currently expending a lot of effort trying to help clients build such defences with risk management.

For fleet specialist THB UK, it has a Hadrian's Wall of a task in helping fleets fend against the fact that driving is the second largest cause of accidents at work and, according to Health & Safety Executive figures, 23% of all work-related accidents involve a vehicle.

These and other alarming facts have prompted a raft of legislation and regulation in recent years all designed to dent these startling statistics, make travelling by road safer and ultimately save lives. The result is a regulatory framework that is stiffer than ever, however, businesses generally have been slow to acknowledge and implement the requirements. This signals not only an opportunity for fleet fence makers but the chance to offer a broader range of risk management and health and safety services to clients to complement risk transfer.

To this end THB UK is undergoing an expansion programme that includes the imminent acquisition of a specialist health and safety business. This will see Andy Hawkes become chief executive officer of THB UK to oversee the expansion, while Glen McCully will become managing director of THB Risk Solutions and John Harley the managing director of THB Risk Management.

The acquisition will extend THB's risk management proposition to include a range of health and safety offerings including workstation safety, stress, ergonomics, manual handling and fire risk assessments. The company, which also provides driver risk assessments, has worked with THB to assess many of its clients' fleet drivers prior to the acquisition and this existing relationship has led to the acquisition process.

This, like THB's risk management division that grew its top line by 51% last year, will sit alongside insurance, but not exclusively, as Risk Management managing director John Harley explains: "While often companies buy our risk services if insurers are prepared to sponsor it, the realisation that firms have a legal duty of care has seen a growing demand for our solutions regardless of insurance premium funding. Our approach has been built up around white label partnerships that are used or endorsed by a number of the top insurers. We also provide a white label service to leasing company GE to provide a duty of care programme to leasing clients."

Hawkes says another driver for a wider approach is the blurring of the lines between occupational road risk, risk management and health and safety. "This blurring is why we are looking at the whole area and is also why it is logical for us to make an acquisition to enable us to move from pure road risks into full health and safety support and services," he adds.

He continues: "If you look at where THB UK is focused, its core strengths are in the areas of distribution and in the current distribution-led climate there's plenty of capacity at present. The Risk Solutions (schemes) business has built a broader range of products in the past 12 months and will continue to provide offerings to the regional broker market and also to offer capacity providers with product innovation and a distribution capability." THB Risk Solutions managing director Glen McCully adds that this year the business will have around £60m of gross premium flowing through it and that its product range has gone from three core products to seven in the past 12 months.

Commenting on its targets, Hawkes says: "We'd expect in the next three years our premium income to hit £100m, partly driven by the hard market and partly by the additional products. We've just revamped and relaunched our core historic product, Fleet UK, and we now incorporate the use of fleet risk audits as a value-add to clients with it. We really are driving occupational road risk management into the Fleet UK product that is the result of a ten-year relationship with Zurich. We're also looking at new offerings for the fleet market in terms of how we can bring risk management alongside the insurance aspects."

Commenting further on THB in the context of the issues facing fleets, Hawkes says: "We see the blending of insurance and risk management as a vital recipe for future success. Having the insurance schemes business alongside the risk management expertise is a good proposition in the marketplace ensuring significant mutual growth opportunities, but the world of occupational road risk has evolved greatly from what it was three or four years ago. Then, it was about driver training for economic and moral reasons. What's happened is that there has been an imposition of legislation, and the duty of care issues that exist for running a fleet now have grown significantly. THB fits into that as a fleet insurance specialist, a fleet risk management specialist and a fleet health and safety specialist. We look to sell more products to existing customers above anything else."

Hawkes concludes: "As a business we are, like others, looking to grow organically and by acquisition, and we offer a broad range of specialities to our broker and insurer partners with the UK operation."