Broking success: Data driven
Matt Munro, Chief Executive Officer of iGO4 (part of the NMG Group), talks telematics, aggregator sites and the importance of brokers utilising data to add value for insurers.
How did you get started in insurance?
I fell into insurance. I got a job at Endsleigh and, like most people, thought I’d do this for a year or so until I get something a bit more exciting. Endsleigh was fantastic in terms of giving me responsibility and developing me, so by the time I was 22 I was running my own branch in London. I then moved on to Aon and worked in their partnerships area. Then I was approached to work for BGL to help them set up, build and grow Junction. I’ve never looked back.
What is the history of iGO4?
The original concept of iGO4 was to help insurers understand aggregators. We didn’t have any capital behind us just some good ideas. We outsourced our administration at the time and effectively we were a virtual broker looking at motor and home insurance in the aggregator space. We saw at an early stage that telematics was a real innovation for the market and we realised we weren’t going to be able to broaden our product range using an outsourced administration partner. We got some investment into the business and set up our own operation in Peterborough in July 2011. That led us to diversifying into other product lines. We launched into telematics and commercial vehicle, and in addition to that we started to look at partnerships.
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What skills do you have that have helped you succeed in this industry?
It’s all about relationships. I’ve always had very strong relationships with the market. It’s also about being tenacious. Anybody who has ever set their own business up will probably say the same thing – never take no for an answer. And it’s about being true to your word. You have to have integrity.
Who are your clients?
We’ve got two parts of our business. There is the direct to consumer side of things where we operate as iGO4 or Wise Driving, which is our telematics brand. We also work with a number of partners to deliver them insurance solutions. Our end customer is the end consumer, but we try to be quite innovative and do things differently in terms of our trading model with insurers and the rest of the supply chain. We’re now looking to utilise the data that we’ve got access to in order to continue to improve customer selection and also make sure that we’re able to create additional rating factors for insurers. That for us is where telematics really comes into play.
How have you grown the business since you set it up?
In our direct business it’s about how we work with the aggregators and insurers to find pockets of business and help the insurers to expand their footprint. We were an early adopter of telematics and that means we have insurers working with us that aren’t working with other people. We’ve got to take advantage of the position that we’ve put ourselves in. We work with partners who complement what we’re doing on the direct side of things.
In terms of how we try to differentiate ourselves, there’s a real risk for brokers that are just sitting in between the insurer and the price comparison site. You’ve got to add value back to the insurers and give them access to different customers. You’ve got to help them solve issues that they’ve got and present them with new opportunities. Doing that has supported our growth.
Are you planning on venturing into any new areas of business?
We’re very focused on making sure that we realise the opportunities that are out there. The immediate opportunity for us is to cement our position as one of the leading brokers in telematics. One of the things we’ve been very good at is taking opportunities as they come along, but we don’t have a strategy to move into commercial lines or anything like that.
Does most of your business go through comparison websites?
Yes, unashamedly. That’s where the consumers are choosing to shop around for their insurance and for us it’s about how you try and write different types of business on the price comparison sites. I suspect in terms of our direct business it’s over 95% that goes through them.
What are the benefits of using that type of model?
It was very easy for us to get to market. It’s more challenging now to get new propositions and new brands onto the price comparison sites because there are so many there. It’s about how you demonstrate to the price comparison site that you’re delivering something different. Telematics has enabled us to do that. We have got a neutral brand called Insurance Services, which effectively is a facility where we can take connected personal lines business from commercial brokers. That’s got around 30,000 policies, so it’s not insignificant. We can provide very competitive rates and good service and it basically allows commercial brokers to focus on their core business.
Which insurers do you think provide the best service?
We work very closely with a range of insurers. We’ve got a very strong relationship with Covéa, Axa, Ageas, some of the Gibraltar-based insurers and Markerstudy. When you say service I think it’s actually people that are willing to listen to different ways of doing things. They supported us through our growth so it’s the big companies and some of the smaller ones.
What do you see happening in the broking sector in 2016?
You’ll actually see insurers start moving away [from some brokers]. You need to be adding value to the insurer by utilising the data you’ve got and by presenting them with opportunities to write business in a different way. There are still lots of brokers out there that are going subnet and just sitting in between the insurer and the aggregators. Insurers are now starting to take action. I’ve had meetings recently where that has been the message.
Everybody has got their eye on the regulatory regime and what that is going to mean from a market perspective. There will be some pricing models in the personal lines market that were built on long-term lifetime value. Some of those models are going to come under some severe pressure.
Who are your main competitors?
That’s quite a difficult one to answer. You’ve got 150+ brands on the price comparison sites. And also we operate across a number of different areas. In terms of competitors it is the direct writers. And then it’s everybody else. It’s about how you set yourself apart and that’s where we’ve got unique products and rates from insurers.
This article is available on Insurance Age.