Oliver Watts, Motor Trade Schemes Underwriter, salutes the THB local broker network keeping Britain on the road to success.
It’s a sobering thought that even in the stasis and inertia that’s gripped the high street this year, a whopping great 2.2 million car registrations have been recorded up to this November 2018. And when you look at the third quarter of the year alone, 2 million used cars have changed hands the length and breadth of the UK (source SMMT).
The automotive industry is still a good one to be in. In 2017, more than 1.67m cars were built in the UK and exports remain at historically high levels, with 1.34m shipped worldwide, half of these to the European Union.
At THB we view the Motor Trades sector of our business as a group of nuggets stretching the length and breadth of the country and we currently handle total premiums of around £2million spread across 350 clients nationwide.
Shop around or one-stop-shop?
Be honest, how many of us have ‘shopped around’ or headed to a price comparison website as soon as we’re received an insurance quote? I’ll put my hand up and admit to that one too. But at THB we’ve noticed a growing trend amongst our local brokers that clients are choosing to remain with us rather than just switch policy providers, having taken fright at the latest quotation.
We are proud that our level of client retention remains at around 85% of renewals every year – no mean feat in a fiercely price-driven market.
What is the reason for this success?
A typical motor trade client pays between £5k and £15k in premiums, and they are therefore classed in the SME size bracket with around four to five employees. These business owners are often time-poor and aren’t necessarily adept at administration.
Brokers who take the time and the effort to visit these small businesses and help them fill out proposal forms tend to enjoy much greater levels of success in converting and retaining the business.
From our point of view this is beneficial too, as the information tends to be presented in a much clearer and more relevant manner. Our local brokers bring a level of trust to the motor trade, plus local know-how, awareness of client needs and the dynamics of either the rural or urban markets in which their clients operate. It’s a level of power in the business that’s unsurpassed and what I would term front-line.
According to the Association of British insurers annual figures, the size of the market has been growing steadily, with Gross Written Premiums for comprehensive private car policies growing 12% from 2015 to £12 billion. There has also been steady growth in volume in recent years, with over 27m policies written in 2016.
Whether it’s an independent car showroom in a Liverpool suburb or a tractor and trailers yard in rural Lincoln, each brings its own business dynamic to the market and we have to be ready to respond to their needs.