1. Members Report: EBM, Australia
AAA Conference | 18 May 2018
Auckland, New Zealand
Members Report: EBM, Australia

2. AAA Members Report – Australia
Country: Australia
Name of Member: EBM
Membership details (update)
- Annual Premium Turnover: AUD $200m +
- Number of Staff: 219
- Locations: Perth, Sydney, Melbourne, Southport, Kalgoorlie, Bunbury, Geraldton, Karratha and Adelaide (RentCover person)
Countries of Operation: Australia

3. AAA Members Report – Australia
Professional Indemnity Details (update)
- Limit of Indemnity: $100,000,000
- Legislative Requirements: $20,000,000
- Insurers: NIBA Scheme and Lloyd’s participants

4. AAA Members Report – Australia
Who regulates Insurance Brokers in the country: Australian Securities & Investment Commission (ASIC)
What Insurance Broker and Agent Education Programs exists: QPIB, Diploma and Certificates
How many Insurers operate in the country: 100 APRA approved. Approximately 20% of which are active broker markets (only 1 is exclusive to brokers, Zurich)

5. AAA Members Report – Australia
Market Conditions
- Number of Insurers decreasing, increasing, stable:
Stable
- Insurance capacity decreasing, increasing, stable:
Stable – major insurers have capacity and slightly moving reinsurance arrangements. Hazard Property and D&O under pressure
- Premiums decreasing, increasing, stable: Stable / moderate increase (hardening dramatically in the hard to place Property and side C exposed D&O
- Commissions decreasing, increasing, stable: Stable
- Average Broker income percentage earned as fees: 24%

6. AAA Members Report – Australia
Number of Brokers decreasing, increasing, stable: Decreasing (increase in AR model (insurer owned in some instances), and cluster group and international broker acquisitions)
Overall level of Insurance Business decreasing, increasing, stable: Stable – 2017/18 May YTD
Percentage of business controlled direct by Brokers: 90% Commercial, 20% Domestic
Percentage of business controlled direct by Insurers: 5% Commercial, 70% Domestic
Percentage of business controlled by other outlets: Agents, 5% Commercial, 10% Domestic

7. AAA Members Report – Australia
Information Technology used by Brokers (including Internet): CBS/EBIX, Ferret (Document Management System), Client Relationship Management platform (EBIX SmartOffice proposal - work in progress), iNavigator (intranet), Qlikview (data), EBIX Evolution being evaluated for Agency and possibly Broking.

8. AAA Members Report – Australia
Political issues at time of report:
Broader financial services sector under review (Royal commission) which may result in reputational damage to the general insurance industry and/or imposed regulation.
ASIC powers heightened.
Economy at time of report: Stablised. Resources downturn is showing good signs of recovery.

9. AAA Members Report – Australia
Member’s view of Insurance Broking over the next three years: Competition remains strong. Real focus on business development and consistent national operating model. CoverLink (Managing Agency) for SME business and Personal Lines (consolidation). Market uniqueness (EBM only private/non aligned with scale). Exploring Lloyds Singapore options given direct broker access to London markets, similar time zones and understanding of doing business in the APAC region.
Any major issues to be resolved: Re-establish Melbourne Corporate and grow East coast broking operations. Development of Construction & Marine business. New business growth and strategic focus. Link the opportunities between RentCover and Broking.
Member’s principle activities over last year: Re-establishment of national Corporate Broking, Managing Agency/CoverLink enhanced services, Strategic Planning initiatives to focus on core business areas (Broking, RentCover, CoverLink and Financial Planning) supported by back office functions.
Member’s planned activities over the coming year: Target new business growth across all areas of operation, consolidate EBM further as an important player in Construction, portfolio consolidation (with CoverLink and major insurer partners including Lloyd’s), RentCover expansion, IT&T projects (such as CRM) and People & Culture expansion into more refined and targeted training & development (EBM Academy).

10. Points of interest - Positive
AAA Members Report – Australia
Points of interest - Positive
Resources showing some positive signs of improvement.
RentCover business continues to advance with its offering and service capabilities and recently gained several large accounts.
CoverLink National and International schemes and facilities, new and existing, all set for growth.
‘Soft dollar’ income growth becoming more significant (CoverLink work).
Low interest rates.
Business development plans and structure bedded down with key people in position.
Sharon Fox-Slater promoted to Managing Director (RentCover) and joined the National Executive.
12 month secondment to Melbourne - Ryan Cameron (Executive General Manager) focusing on a) business development, b) resetting Melbourne Corporate and c) RentCover joint opportunities.
Appointment of Clint Jeuring – Energy Specialist (Executive Account Director).
Appointment of Lyndall Mitchell – National Relationship Manager (Broking).

11. Points of interest - Negative
AAA Members Report – Australia
Points of interest - Negative
Insurers focusing on the direct market and being quite blatant about it.
Competition becoming more active, especially with growth of the AR force (some insurer owned).
Increased regulation and compliance, closer scrutiny of the Financial Services industry e.g. Hayne Royal commission.
Hardening sectors of the market.