Brokers across the UK have faced mounting pressure to prove their value as regulation reshapes the insurance market, but Howden’s Andrew Hall (pictured) believes the tide may finally be turning in their favour.
Specialty brokers are navigating one of the most consequential regulatory periods in decades. Consumer duty, cyber exposures, captives and a more interventionist FCA are all changing how advice is delivered and judged. For Hall, group head of risk at Howden, the role of the broker is not shrinking under compliance pressure; it is becoming more important than ever.
Until recently, brokers were buried under a wave of new requirements. Today, Hall sees “green shoots” of improvement. “If you’d gone back 18 months, we were all just dealing with a weight of new regulation constantly coming out,” he said. “Now, the trend is beginning to be positive. My overall comment is: green shoots are looking good, keep it up.”
Still, simplifying the rulebook remains a challenge. “We have a complicated rulebook built on a combination of UK and European legislation. To really make a practical, everyday difference, there needs to be both top-down policy change and the unpicking of all the exemptions that have grown up over the last 20 years.”
Cyber remains one of the most scrutinised lines of business. “Cyber is one area facing particularly heavy scrutiny,” Hall said. “Cyber insurance is actually not named well, I don’t think people understand what the product is half the time.”
Beyond cyber, Hall also sees new regulatory and operational challenges emerging around artificial intelligence. “You deploy an AI tool somewhere, but does it actually follow the same rules? We’ve all built up rules in our organisation to protect and segment data. Does it just ride roughshod over it? I don’t think we always know the answer,” he said.
By contrast, the UK’s new captives regime is a positive step. “Captives have been part of the toolkit for London market brokers for years. They just haven’t been available in the UK,” Hall explained. But he warned that regulators must avoid applying broad consumer duty rules to what is a niche product for sophisticated buyers. “We need to make sure captives are not accidentally caught within some loose definitions.”
Few reforms have sparked as much debate as consumer duty. But Hall believes it reinforces the strengths of specialist brokers. “London market brokers survived by giving good advice and ensuring clients got good outcomes,” he said. “So as much as there’s a new set of requirements, for a high-quality specialist broker it should be business as usual.”
The difference, he stressed, lies in execution. “If you do a really good job for your client, they don’t mind paying for it. The best brokers make their money when the market conditions are toughest. Value follows the substance of what you do, and it should be unarguable.”
Emerging tools may ease compliance work, but Hall is realistic about their limits. “There are fascinating pilots at the moment. Over the medium term, I think compliance checks embedded in the broking workflow will transform processes,” he said. “But, if you want to build in workflow checks that throw up flags, you’ve probably got to update all that legacy tech.”
And even with technology, regulation will always take time to bed in. “Any new regulation, you only really get it nailed on about the third try. You implement it, you do your best, you learn, and then by the third time through, you’re usually doing it pretty well.”
For Hall, the future of broking is still anchored in expertise. “That’s really where specialty brokers should be thriving, because the whole point of having a specialist broker is that they understand the sector deeply, rather than being a generalist,” he said.
As scrutiny rises and clients grow more demanding, Hall believes the brokers who thrive will be those who deliver clarity in a complex market. “I think the regulatory tone is positive, and the early signs are directionally good,” he said. “But there’s still a lot of work to do to effect real change.”
