Regional review: Romford

“We sometimes talk in the office about Romford being the Silicon Valley of the broker market in some ways,” laughs Ben Halcro head of sales at Grove & Dean.

“It isn’t quite as diverse as that! But, if you look around, there is an entrepreneurial spirit in the area.”

Undoubtedly Romford and the surrounding region, situated just 15 miles from London, has no shortage of specialist broking knowledge.

Another insurance fact is that Peter Cullum set up Towergate just around the corner in Hornchurch. Sadly for the regional review the office is no longer there.

Grove & Dean, established in 1974 in Upminster Bridge, was also previously based in Hornchurch and made the short move to Romford just under a decade ago. The broker, which owns the brand Performance Direct, has grown over the years to have £60m of gross written premium (GWP).

If you look around, there is an entrepreneurial spirit in the area

Ben Halcro

Big fish

Halcro explains that the firm targets business where it can be a “big fish in a small pool” and achieves 10%-20% growth each year. He lists young drivers, convicted drivers, classic cars and commercial vehicles among its specialist niches. And reveals the acronym PIMP as a key target: Performance, Import, Modified and Prestige.

Selling nationally means internet success is fundamental to the health of the business and in some ways the broker sees itself as a tech company that sells insurance. However, every customer is spoken to before a policy is bound.

“It gives us the added layer of protection,” he explains. “We have never seen a reason to change it.”

Some 148 members of staff are tasked with delivering this service for customers and insurers. Most live within a 10-mile radius. 

Occasionally the company loses employees to brokers in London – “I see that as a compliment,” says Halcro – but not to any great extent with most preferring the local commute and ability to progress their careers at the firm. Over the last five years it has invested “heavily” in apprenticeships and all employees are sponsored to go through the Chartered Insurance Institute’s (CII) training.

It is about clients recognising that the broker they are with understands them and biking

William Hughes

Specialists

Less than five minutes’ walk away is national motorcycle specialist Devitt.

Started as a family business in 1936 it was sold to Churchill in 1999, became part of RBS in 2003 until 2011 when managing director William Hughes and finance director Tony Chapman undertook an MBO.

The company is growing at 10% a year. “We are not one of these people saying we will double every three years,” notes Chapman. “We have no one else telling us what we need to deliver.”

The only real local pressure is on staff moving between employers both within and outside of broking. Hughes joined in 1996 as a team leader and worked his way up to the MD role. “We don’t struggle to get candidates,” he points out. “Our proximity to London could mean there is some talent out there that would prefer to work in the City that we don’t get exposed to. But that’s just a feeling, we can’t prove that is the case.”

Devitt has 180 staff and boasts £54m of GWP split approximately 60% as motorcycle; 30% for motorhomes; and car, home and £2m of commercial revenue make up the rest.

Like Grove & Dean it invests significantly in training and both men are confident of ongoing success. However, with a cutthroat market for business across the UK the company still has to battle to win.

In addition to social media work and sponsoring a road race motorbike team Devitt works hard on delivery and retention.

“It is about clients recognising that the broker they are with understands them and biking,” says Hughes.

But he accepts many will always buy on price. “[Motorcycle business] is commoditised, 80% is sold on aggregators where price is king.”

As to the local area Hughes accepts that Romford “went through a bit of a lull” during the recession but his feeling now is “that it is thriving”.

We have a good understanding of exactly what the customer is feeling and make it as easy as possible for them to transact what can be a very personal and complicated process

Garry Nelson

Sticking with the specialism theme is AllClear Travel Insurance. The historical roots of the business have always been in the area. Head of marketing, Garry Nelson, is upbeat about both the region and the firm’s nationwide opportunities.

Simply put it is a specialist medical travel insurance broker for travellers who have difficulty getting cover elsewhere.

The owners set up a business in the mid-1980s. When that was sold to LV in 2000 the provider did not want the travel arm so it was spun out with the AllClear trading brand, which grew from a medical screening firm to what it is today. In 2010 it unveiled its impaired medical panel offering on its own IT platform. It now has £30m of GWP delivered by 100 full time equivalent staff.

“It is exciting times,” Nelson confirms. In the next five years the business is looking to hit £80m of GWP and has a track record of year-on-year double digit growth.

It advertises on television but perhaps is better known to brokers from its association with the British Insurance Brokers’ Association. It has provided a scheme to the trade body for six years and recently signed up for another three.

The bulk of AllClear’s clients come from the over 50s market. It has a strong online and call centre presence with Nelson stressing that the mature market “want to speak to someone”.

“We have a good understanding of exactly what the customer is feeling and make it as easy as possible for them to transact what can be a very personal and complicated process with some of the medical conditions we see,” he says.

Long tradition

As to why there are quite so many specialist firms in the region Nelson highlights that Romford has a long held tradition of financial services.

“Perhaps they have had to specialise as they can’t compete with some of the massive players in London?” he suggests.

Like the other specialists and with their call centre needs, staffing the business is core to success. Almost all come from within the M25.

“We want to give employment opportunities and be perceived as a good business to work for,” he sums up.

I am a firm believer that there will always be a market for the personal touch and advice led approach

Sunil Shah

Staying local 

The region is packed with specialists targeting business across the country but there are also more traditional brokers serving the local community. C&M Insurance is a prime example.

Started in 1996 it has grown to £2m of GWP with 10 staff servicing SMEs and mid-corporate business from Gidea Park, just two miles east of Romford.

Managing director Sunil Shah explains that the broker predominantly deals with clients in a 30-mile radius of its office. Approximately 95% of business is commercial with manufacturing, motor trade and liability particular strengths.

“We can add value because we can go and see the client,” he sums up. “I am a firm believer that there will always be a market for the personal touch and advice led approach.”

In his view the local economy is doing really well. “The majority of clients are seeing an increase in activity.”

One local factor has been Crossrail, a major investment in the rail infrastructure that goes through Romford as it links Shenfield to Reading.

“You are seeing an increase in house prices,” Shah notes. “It is exciting and the accessibility to London will be even greater.”

While he hasn’t seen an influx of new clients, those subcontracting to the project have had increased turnovers.

London calling

The access to nearby London and the insurers in the capital is a theme running through all the interviews.

“We find the insurers are flexible around here and there is no problem with getting meetings,” Shah states.

The firm has a target of £3.5m GWP and is growing at 20% a year. As well as seeing improving insurer service it is a Broker Network member. He praises the range of services and the way it helps educate the firm.

Another proud Broker Network member is LG Insurance. The company also has 10 staff with one office in the heart of Romford. It was formed in 1989 and now stands at £2.3m of GWP split 50/50 for commercial and personal lines. 

[The local economy] has certainly improved over the last six to nine months. The dust is settling after the Brexit vote

Ross King

On commercial business, director Ross King lists contractors and one man bands up to SMEs with £10m turnover as the sweet spot, with clients spread across factories, engineering, manufacturing and clerical businesses. For personal customers it focuses on standard motor, home, let property and travel.

Most clients and employees come from within a 10-mile radius and King believes the local economy is stable. “It has certainly improved over the last six to nine months,” he observes. “The dust is settling after the Brexit vote.”

While the broking market is “reasonably competitive”, King accepts there are fewer brokers, perhaps as many as two thirds of independent firms have been bought up by consolidators since the company was formed.

“We pride ourselves on our knowledge,” he details. A retention rate north of 90% for commercial and personal business is testament to the fact that success is ongoing.

“We like to cater for everyone’s needs for their business and in their life,” King details explaining the reason for the balance in the broker’s book. “If you are local we are local. It is a one-stop shop.”

He is adamant that the future is bright with local clients coming back to the broker market.

“In Romford people want the conversations, to know the person at the end of the phone. We are all local businesses. We might not be in the same trade but we are the same size and have the same business issues.”

The provider’s view

The specialist theme in Romford and the surrounding region runs across both brokers and providers.

Incorporated Insurance Group opened its doors to business in 2013. The managing general agent now has 14 staff and approaching £12m of GWP across lines including contractors, liability and property. “The Romford area has great access to the City and a lot of the team were based in the area,” says CEO Mike Smith explaining why it set up in Hornchurch near Romford.

Relationships underpin the nationwide model. “What we believe is that the profitable brokers in this sector are regionally based independent firms who go out to the clients, understand the risk and can give us the information,” says Smith.

It has around 210 broker partners at the moment including several locally. “Essex always has been a very proactive, vibrant trading area,” confirms underwriting manager Dean Surridge. Adding: “There is definitely a loyalty there.” He sums up the region as “honest and to the point”.

As to why there are so many specialist firms, head of operations Lyndsey Thompson recalls that historically Romford had a motor trader base. And she says over the years the region has created entrepreneurs who “set up in close proximity”.

“There has been some really good management,” she concludes. “They have seen a need, had really good ideas and evolved.”