Network benefits

Despite being located only 10 miles from Glasgow, Moreland Insurance is testament to how having a local presence can make a big difference. In January, a move from a business park on the outskirts of Hamilton to a town centre location not only gave this traditional Scottish commercial broker a high-street footing and fresh impetus but also its own building.

One of the first requirements made by the government when it bailed out RBS was to ensure that it would support lending to small businesses. Moreland, having started on nearby Motherwell's high street, was first to take advantage of this situation, securing funding to buy its own building on Hamilton's high street next to other professionals including accountants, solicitors and surveyors. There is no direct rival in sight: the only other Hamilton-based broker, DW Steedman, was bought by Giles in 2003 and merged into its Glasgow office. As a result, former Giles managing direcor Michael Quinn joined the business. Alan Johnston, director at Moreland Insurance, comments on the Giles deal: "This made sense for them but, by moving to the big city, you divorce yourself from clients. There is still value in being connected to the local community."

Positive attitude

Despite operating a business in the midst of the worst recession in living memory, Johnston is relaxed when I meet him in a hotel in Glasgow - where he is participating in our PB Management Event roundtable (see pp.30-33). He has recently returned from an annual networking event in Palma, the capital of Mallorca, which he attended with fellow members of the Willis Commercial Network.

It appears that the recession has not had a huge impact on Scottish brokers (see pp.30-33) - so far at least - and with the right attitude there is plenty of opportunity to win new business. Johnston is upbeat and looking at the positives: "There are winners and losers but there are still large projects in the public sector, such as the extension to the M74 and the athletes' village for the Commonwealth Games in Glasgow in 2014."

Johnston became a shareholder in Moreland in June 2006 when one of the owners, Warrick England, sold due to ill health. Sadly, he died later that year. Surprisingly, no advisers were needed when completing this transaction and the shares are now divided between Kevin Muir, Johnston and Maurice Logie, although Muir no longer has an active role in the business. Since the changes in ownership, the new management team has been determined to preserve the firm's heritage. Johnston says: "We were well known and respected and we haven't changed much. We are going to play to our strengths within the business community in Scotland." Logie looks after sales development and new business while Johnston looks after compliance, staffing and client retention.

Handily, Logie is president of the Lanarkshire Chamber of Commerce and therefore networking opportunities abound, providing the business with its principal source of growth. Since 2006, gross written premium has climbed by £1.5m and the broker aspires to reach £8m in 2011. Any growth will be measured, however, with Johnston determined not to "do things we don't understand." As with many other brokers, Johnston is keen to pick up account managers and their books of business; he is in talks with several. Additionally, Moreland is interested in purchasing small brokers where it sees a good fit.

Connections

Being one of 10 Scottish brokers in the Willis Commercial Network means that funding is readily available for acquisitions but perhaps Moreland's membership of a secondary network - N2 - is more appropriate for what the firm is trying to achieve. (N2 helps smaller brokers, appointed representatives and start-ups and has had some early, limited success.)

Moreland is also one of five brokers affiliated to the British Franchise Association, giving it access to seemingly endless chains of businesses that include coffee shops, sandwich bars, pet food retailers and cleaning contractors among many others. Johnston highlights: "We understand how the model works and the subtle differences." The broker also has a large charity and church book through Ansvar, Congregation and Ecclesiastical, while the rest of its business is placed with large composites and relationships with Hiscox and NIG.

Like most brokers, Johnston cherishes his relationships with insurers and realises that this exchange, like any other, is about "people dealing with people"; however, he wants them to do more to help provide information electronically to clients.

Johnston has ambitions to create an insurer-client portal through which secure access can be had to up-to-date policy documents, as well as renewal schedules and risk management advice, an idea about which he feels strongly: "I can't believe how poor insurers have been at embracing technology. We may have a breakthrough on this in a year but that is like a decade nowadays."

Moreland joined the Willis Commercial Network five years ago and Johnston says that doing this has helped the broker to maintain consistent, stable insurer relationships. He enjoys the community aspect of the network, on which he comments: "We are similar types [of brokers] with a similar ethos and standards. Our tenth anniversary conference in Palma had some really interesting and thought-provoking seminars." Another benefit is greater kudos with insurers and enhanced commissions and, overall, Johnston appears contented: "There is no real downside to being part of the network and perhaps we are guilty of taking it a bit for granted."

Johnston can enjoy his summer holiday knowing that he will return to manage a healthy business with modest but achievable ambitions - which is good going in this economic environment. He concludes: "We want to keep making the little things better and we need insurers to help us." Once again, proof that local, independent commercial insurance broking is alive and well.