MARKETING

Marketing



Marketing

The business was founded in 1922 when two friends Andy Purfect and Bill Reeves as Pure General Insurance. During the 1930s and 1940s the business specialised in the new member groups which were beginning to set up such as the Government services Motoring Club. Bill's wife was a local government employee and was a member of the club before they married. She started the partnership down this road when she and a few of the fellow members asked Bill to arrange motor insurance for them and provide the club with an income by sharing the commission.

As a broker, PGI get a 25% commission for each policy they place with an insurance writer. Once the seed had been sown, Bill concentrated his efforts in signing up other “affinity” groups and eventually moved into the larger trade union groups offering the full range of motor insurance policies to group member. The groups were happy to make these arrangements, as they were able to enjoy another income stream, in addition to their subscriptions, by sharing in the commission that PGI earned. Affinity groups received 10% of the insurance premium leaving PGI with 15%.

The 1980s were a turbulent time for insurers, especially motor insurance provider with the rise in direct insurers such as Direct Line (DL). DL took the market by storm by introducing the direct insurance concept whereby the consumer was able to go direct to the insurer and cut out the middleman (broker) and get a cheaper deal. In addition DL were able to “cherry pick” the lower risk customers (those who didn't have many accidents) because they could ask more question and better understand the risk they were taking on when compared to the traditional distribution channel of brokers. Brokers by this time were operating delegated underwriting arrangements. This is where the Insurance Company allows the introducer to commit the insurance company to the risk so long as the risk fells within certain parameters. This delegated underwriting enabled the brokers to operate a panel of insurance companies and offer their customers a competitive price for their particular risk, however the process was not as refined as the one that DL introduced.

Motor insurance: analysing the trends

Household insurance tends to be far more affordable than car cover or other types of vehicle insurance, as cars carry a greater underwriting risk, given that they are often parked on the road in less than premier suburbs. Under such circumstances, vehicles are actively targeted by criminals, making the risk of theft or break-ins far higher than that associated with a secure home. When you sign up for Dial Direct's home content insurance online, you will even qualify for an additional 5% discount on your monthly premiums, giving you a particularly sweet deal on peace of mind.

One thing to be aware of is that most household content insurers will not allow you to insure a pair of sunglasses, a camera or sports equipment without taking out a comprehensive household content insurance policy, as it would not ...