Personal lines sustainability debate flares up in Glasgow

The first Professional Broking Roadshow, held in Glasgow, was not without controversy as delegates strongly objected to comments by Phil Scarrett, Norwich Union's director of regional business North, that some intermediated personal lines were unsustainable.

In the question-and-answer session, several brokers made the point that, if this was the case, it was for artificially imposed reasons.

Scarrett, after answering a separate question, went back to the theme of his speech about the changing face of distribution. He said: "Brokers need to identify where they can add value and perhaps consider if they should pull out of some personal lines altogether."

This comment drew gasps from some delegates, and Julie Ross of Crosbie & Jack was the first to take him up on the point. She said: "The retail rules for intermediaries are different to those governing direct. Direct is just required to provide a price, not advice, and I fail to see how the regime has created a level playing field. How can the Financial Services Authority regulate those that do not take into account customers' needs?"

Jim Jordan of Nelson Jordan Insurances also said: "With the arrangements we have, we can often beat the direct price for a customer who then benefits from our service as well. The problem is being admitted to the playing field to compete in the first place."

Eric Galbraith, chief executive of the British Insurance Brokers' Association, responded by saying brokers should demonstrate how to add value and choose the markets they do this in carefully.