Broking success: Planning on growth

▶ How did you become involved with the business?

I worked for Swinton Insurance for 12 years. I started there when I left school and worked my way up the career ladder doing various jobs in the branches. I was branch manager, area manager, and then I went to work in head office to manage its inbound call centre. When I was in my mid-twenties, reporting to the board at Swinton, I was told that for the next 10 to 15 years I would need to work at that level and get some wider experience before I could progress any further. I decided that I didn’t really want to do that so I thought “I’ll set up on my own”. That was in June 2003.

▶ Was it difficult starting out on your own?

I left my very good job at Swinton at the same time that my wife was six months pregnant with our first baby, Grace. I knew that [if I waited for her to] come along I would never do it because I had a good secure job. So I thought: “Right I’m going to do it, and I’m going to do it now.” I bought Heath & Blackshaw Insurance Services, an established firm, and a very good brokerage, in Congleton. It had been trading since 1882, so had a really good length of history. The acquisition brought in just over £1m of insurance premium and County Insurance was established through that acquisition. At the beginning there were seven of us. I went from managing 180 staff in the call centre to sitting on the counter answering the phone.

▶ How did you grow at first?

The growth of the business was organic. To start off we had to buy a business that had the agencies, because getting them was probably the main thing. The plan was always to grow the business organically. We succeeded in doing that by focusing in certain niche areas, hire and reward, professional drivers and so forth. That’s where we’ve done very well. The growth plan was to market ourselves to a wider spectrum than perhaps Heath & Blackshaw had.

▶ Have you made any other acquisitions?

Yes, we bought a small business called Wilmslow Insurance Services, in June 2004. Then we didn’t buy any more until last year when we bought Whitchurch Insurance Services, which is a fantastic market town brokerage. There are currently loads of those types of businesses out there where the service to the customer is really good because it’s local and they’re face to face.

We’ve got our head office, which I wouldn’t describe as a call centre. I’ve worked in a call centre and it’s much more relaxed here, but we do have a telesales operation here. And by having the branch network as well, with people very close to the customer, we can get great results for the business.

▶ Are there plans to make more acquisitions?

Yes, we’ve got plans. Within five years we’d like to have 10 to 15 more like Whitchurch Insurance, where we’re in a market town and close to local customers. Predominantly we will start in the North West, but if the right opportunity came along we would consider something anywhere. If an opportunity came up tomorrow in Cornwall, if it was a good business and we felt we could go in and make a difference, provide them with some central compliance, training, some essential function support, then we’d buy it.

▶ Are there any new areas of the insurance market you are interested in entering?

Yes, our new Manchester office was a conscious decision as a business to move into the commercial insurance broking arena, and we’ve got a very clear focus on bringing in premiums worth £10,000-£100,000. A lot of what we write at the moment is transactional stuff, worth a couple of grand with customers paying for it over the phone. We’ve opened the office in Manchester with a very clear steering towards account managed customers. We want to give face-to-face service and more risk management advice, to work with customers as a real partner. We see that as a really big potential growth area for us. To be fair, we’ll only do that if we get the right people – the success of County Insurance is down to the people.

▶ Do you do much training?

We have an in-house trainer, and we also sponsor people through the cert CII qualifications. We have a tutor who comes in from the local business college, two or three times a week, and we have recently had eight members of staff qualify. We have thirty people who have passed our in-house training process and are cert CII qualified. That’s quite powerful and shows our staff that they can come to work, get that support, and not have to do all their studying at home and do their day jobs as well. We give them time in the day to study, which I think works well.

▶ What is the company’s approach to technology?

We have an e-trading website for car, home and van insurance, called Insurance4your, a quote and buy online site. We don’t do a lot of business on that at the moment. However, we are currently in talks and very close to linking with a couple of aggregators. Going down the aggregator channel will be an exciting new venture for us.

It’s also very hard because it’s very competitive. We’ve done some price tests, but until we’re actually on there and have a go at it, we won’t know what will happen. I would expect us to write some business through that channel, but it’s a very unproven model [for us].

We also use the internet to a great degree to source inquiries. Then we turn every internet inquiry into a more conventional broking client by speaking to them and finding out what exactly it is that they need from a policy.

▶ What are the main regulatory issues facing the company?

We’re obviously facing this move to the Financial Conduct Authority (FCA), we’re working with our compliance partners on any appropriate changes that need to be made. We run a very tight ship in terms of compliance. As a business, the switch from the Financial Services Authority (FSA) to the FCA isn’t going to affect us massively – we’ll make any tweaks necessary.

The change to the FCA should be a good thing, it will be more focused on insurance, and the banks will be dealt with separately. They’re saying that it will be more hands on and more interactive, which should be a positive because [previously] it has been about giving brokers guidelines and telling them to interpret them and saying: “We’ll tell you if you’ve done it right.” The FSA has been very non-committal. I think the FCA will be clearer on what good actually looks like, and what we should be doing.

▶ Are you a member of a network?

No, but we are considering options currently. We’ve grown the business to a size and we have a challenge of deciding whether we’re big enough to not need a network or whether a network can be of benefit to us. I am yet to be convinced really, because I think it’s just someone else who wants to earn money from your business. We’re looking at whether it would be worth it. We’re fiercely independent. I know that the networks say that you can retain your independence but we’ll see.

▶ Would you ever sell the business?

Certainly not yet. I have plans in place for the business for the next 10 to 15 years at the moment. And my children are young, who knows? One day they may wish to work in the crazy world of insurance and take the business over.