On the subject of 2024 monetary efficiency, 12% of brokerage principals and house owners responding to Canadian Underwriter’s annual Nationwide Dealer Survey anticipate issues to be significantly better this 12 months than final.
And an additional 50% say issues can be ‘considerably higher.’
That compares with 13% and 60% giving the identical responses in 2023’s survey; and 12% and 45% respectively in 2022.
On this 12 months’s survey, fielded in January and February 2024, greater than 200 brokers nationwide shared views about challenges and alternatives for the dealer distribution channel. The CU survey is sponsored by Sovereign Insurance coverage.
Extra optimism is current within the variety of brokers (37%) saying 2024’s efficiency will match 2023. That’s a powerful acquire over 27% saying the identical factor final 12 months and higher than 2022’s 32%.
Additional, solely 2% of respondents name for 2024’s efficiency to be worse than final 12 months. Many of the of the optimism (71%) sits with these within the enterprise for 16 or fewer years, amongst ladies (70%) and at brokerages with 20 or fewer staff (66%).
In their very own phrases
Some verbatim responses stress the issue of predicting future efficiency throughout unsure financial occasions.
One veteran respondent at a big agency believes financial pressures will sluggish general development, however provides inflation and rising premium charges will assist his agency develop.
How do brokers profit from inflation? When insurance coverage firms elevate premiums to cowl the elevated claims bills they need to pay as a result of inflation, brokerages earn bigger commissions for every coverage they promote.
However brokerages don’t wish to rely strictly on this theoretical bump of their earnings sparked by the arduous market, as a result of it’s topic to different arduous market disadvantages.
As one respondent places it, “Inflation usually advantages a brokerage, offering that they will retain their clients. We proceed to give attention to rising our [policies in force] PIF per buyer and our general PIF versus relying purely on inflation or premium will increase to find out our success.”
This text is excerpted from one showing within the April-Could 2024 print version of Canadian Underwriter. Characteristic picture courtesy of iStock.com/XiXinXing
