NLIC.org

Virgil Said:

Becoming an insurance broker?

We Answered:

As an insurance broker, I would suggest the following:

There are large commercial insurance brokers, personal lines insurance brokers and those in between. Personally I would approach the larger insurance brokers as they will be able to give you a better grounding in insurance principles (sadly lacking on these forums).

If you can't get employment workign for a large broker then a smaller broker will probably give you a good grounding but in more restricted aspects of insurance i.e. the ones in which they specialise. In fact as I am sure you are aware TC2 compells brokers to be competent before they advice retail customers.

You are definetly recommended to study for professional qualifications through the Chartered Insurance Institute - courses are available up to degree level and you can select your specialism. If you go the commercial route or specialise then you probably have very good prospects.

Salaries vary depending on experience - commercial brokers pay more for qualified staff than personal lines brokers (premiums/ commissions earned are substantially higher) and of course salaries are higher in the South than the North.

You may find jobs quite hard to find as there has been a lot of consolidation in the industry over the last two years (many smaller brokers selling up due to increased compliance costs).

With regards to the internet - most insurance policies are offered by brokers but as price seems to be the main factor the policies being offered provide substantially worse cover than those through an insurance broker - and it is amazing how many people, once they have had to make a claim, decide to come back to their local broker. Also - car insurance premiums bought through a broker are now officially cheaper than those bought direct through an insurance company. The FSA is VERY concerned about the selling of insurance products on the internet.

There is one further factor - the FSA are imposing tight guidelines on commission earned by IFAs (as I am sure you are aware). This has not yet percolated to the general insuranceside.