New horizons: Navigating hard markets and fast changes

Few periods in history are as economically tumultuous as the past three years. Covid-19, Brexit, a smattering of environmental events and more have made the insurance sector, in particular, more complex for the buyer. Insurance premiums and their more stringent Ts and Cs have become a more complicated undertaking for both seller and buyer and as NI’s leading insurance brokerage, we’re frequently asked for our outlook on the future.

While the last few years have been turbulent, we must remember that the insurance market can be cyclical. We go through periods of ‘soft’ and ‘hard’ markets and we’re currently experiencing a hard market that has been felt as far back as a year or two before Covid-19. While many attribute the current state of the market to Covid specifically, the pandemic really just exacerbated a trend that was already happening.

With over 20 years of experience in the insurance sector, I’ve seen the industry’s cyclical nature in action and remember the last comparable hard market back in 2001 - post 9/11.

Overnight things changed. There were issues getting 100% capacity, and getting enough cover for some clients. Some markets folded completely. That was a troubling time for many in the business community.

Difficult though it was, I was fortunate to gain that experience early in my career and it’s interesting to see the number of people in the industry who are experiencing a hard market for the first time.

The outlook

In a hard market, it becomes more of a challenge trying to persuade the insurer to cover and frame the client’s business in the best possible light. I do believe the cycle this time around has been longer and I’m regularly asked if I see signs of the market beginning to soften.

I would say we’re seeing rates begin to stabilise but the softening of the market will only happen when new entrants come in.

Escalating costs, especially within the construction market, have played havoc with insurance premiums for the building sector with knock-on effects elsewhere in the supply chain.

At times like this, you really need an insurance advisor with experience in each industry and also one that has access to wide markets. Thankfully at ABL we have a large team with a wide array of specialisms and exclusive access to insurers and products that no other local broker can offer.

Small businesses or those early in their development are particularly vulnerable to buying incorrectly in a market like this. Without experience, you may end up buying a policy that doesn’t cover your full risk or that has detailed exemptions leaving you and your business at risk if something unexpected happens. As always, talk to an insurance expert before you buy.

Additional effects of a hard market

A hard market usually results in price increases and insurers limiting their exposure by reducing the level of cover offered. However, the hard market also affects claims, as insurers push back on costs and fees associated with claims on their policies.

At ABL we hope to add an additional level of protection to our clients by having a Claims Advocate team who work with our clients and the insurers to make sure claims are paid in full and on time.

How ABL Group can help

ABL Group is part of Global Risk Partners (GRP), the second largest independent intermediary in the UK, handling almost £1bn in premiums. This arrangement naturally gives us access to an exclusive panel of insurers and a higher level of buying power than many brokers in Northern Ireland. And this year, we’ve seen that power increase tenfold as GRP was acquired by Florida-based Brown & Brown Insurance, the 6th largest insurance broking firm in the world.

As anyone who lives and does business here will tell you, Northern Ireland is a unique place. Our business community and our economic and societal make-up have been shaped by our history, geography and political set-up. Particularly now with the implementation of the NI Protocol, dealing with a local firm that really understands the complexities (and opportunities!) of doing business here is essential.

While we’re part of a global group, we operate as an entirely autonomous organisation with decisions made here to best fit our local clients but with the connections, access and buying power of a larger organisation.

An evolving business

Last year was an eventful one for us; ABL Group acquired Willis Towers Watson’s NI business and saw the existing WTW NI team join ABL in our new home at City Quays in Belfast. Our newly combined team has meant our client base has expanded and we’ve completed a restructure at Director level to amplify our future.

Looking ahead, even against the dramatic backdrop of this hard market, growth is still on the agenda for ABL Group.

Acquisitions have definitely been a trend for us over the last number of years and with GRP’s acquisition by Brown & Brown, I think we’ll see that continue. We’ve come into a ‘forever company’ and it’s absolutely fantastic but Brown and Brown is similar to GRP in that growth by acquisition is a cornerstone of its strategy, so we’re really looking forward to the impact they will make.

Focus on the future

I’ve worked hard to get to my position as Managing Director of NI’s largest commercial insurance broker and risk management advisory. However, insurance was never a career I had considered during my politics and history degree at Queen’s University.

It’s a career that you find many people ‘fall into’ but it’s a hugely rewarding and interesting one because you’re dealing with so many different types of businesses and advising them on how to best protect their future. There are so many roles in the industry and I’m keen to showcase that and to share how important the work we do here is.

To that end, our training and accreditation programme, ABL Academy has just taken in its latest cohort who will be working towards their Chartered Institute of Insurance qualifications.

But we have also created a ‘new starter’ programme for school leavers and graduates new to the industry. Our first cohort of ten will undertake a six-month, externally run programme that will cover the basics of insurance and after completion, they move into the ABL Academy to pursue their CII qualifications.

We have strong ambitions to grow in the coming year but we understand that we can’t do that without our greatest asset - our people. So we’re doubling down on our investment in our people.

We have one of the best-qualified teams of insurance professionals anywhere in the industry but we’re planning for the future and doing that groundwork now so we can maintain that level of quality.

We’ve changed so much over the last few years but change and growth are part of our DNA here at ABL Group, and we’re excited for everything 2023 has in store!