Insurance Broker

The Job and What's Involved

Insurance brokers act as a link between clients wanting insurance and insurance companies. Their clients may be individuals or commercial companies. Brokers advise their clients on the most suitable products for their needs. They then use their expertise to select the insurers that will provide the right cover at the best price.

Brokers receive commission from insurance companies but must put their clients' interests above all else. They may also charge fees for their services. All brokers are regulated by the Financial Services Authority (FSA) and must abide by the FSA's strict guidelines.

Brokers deal with a huge range of different risks. They vary from straightforward risks, such as pet insurance, to complex risks such as aircraft and oil rigs. With more complex cases, such as art collections, ships or oil rigs, the insurance broker has to prepare a detailed submission document to present to underwriters. This may involve:

  • Visiting clients to assess their exposure to risk (the likelihood of a loss). They carry out detailed assessments, which may involve structural surveys, health and safety inspections, reviewing previous claims records and taking photographs.
  • Advising clients of the measures they can take to prevent a loss, such as training employees or installing alarms.
  • Advising on changes in the law.

With very large risks, such as an aircraft, insurance may need to be spread amongst several insurance companies. Brokers co-ordinate this by negotiating with different underwriters.

The work of individual brokers can vary widely. In large companies they tend to specialise in technical areas like marine, energy or engineering.

Claims Brokers advise and help clients to prepare and submit claims, sometimes assisting in settlement negotiations.

Risk Assessment brokers conduct safety and claims audits.

Brokers in smaller companies tend to have wider responsibilities. These may include surveying, loss adjusting, risk management, account handling and claims. Increasingly, brokers offer services like risk management and claims recovery advice.

The work of Lloyd's brokers is similar but can involve assets worth millions of pounds spread worldwide. They only deal with Lloyd's insurance companies.

Other parts of brokers' work include administration, dealing with correspondence and collecting premiums.

Brokers typically work office hours, Monday to Friday, although some broking firms open on Saturdays. Part-time work is possible.

The work is office based but with constant contact with clients by phone, post, email and in person. It can involve travelling locally to see clients. Some overseas travel may be needed for international accounts.

Starting salaries for a trainee broker are usually between £15,000 and £25,000 a year.

Getting Started with this Career Choice

Over 100,000 people are employed within insurance broking. Employers range from small brokers to large multinational companies. The number of broking firms has decreased in recent years, largely due to mergers and takeovers. Many brokers work in London, which is the major insurance centre in the UK. There are, however, opportunities throughout the UK, mainly in cities and large towns.

Job vacancies are advertised in local and national newspapers and in publications such as Post Magazine, Insurance Age and Insurance Times. They are also advertised on the websites of individual broking companies and of specialist insurance and finance recruitment agencies. The British Insurance Brokers' Association (BIBA) is the trade association for insurance brokers. Local brokers can be found by logging on to BIBA's website.

Education and Training

There are no standard entry requirements for insurance brokers as individual employers tend to set their own. There are, however, some common points of entry:

Degree entry - larger brokers often have annual graduate recruitment programmes. They require a degree for their training schemes, often a 2:1. Few employers specify degree subjects but economics, business studies, accountancy and maths are useful. Entry to these schemes is very competitive.

A level/H grade entry - entry is normally with at least two A levels/three H grades. Other qualifications may be accepted, either on their own or in combination with A levels/H grades. They include relevant AS levels, applied A levels, Diplomas, BTEC National and BTEC/SQA Higher Nationals, Scottish Group Awards (SGA) and the International Baccalaureate.

Insurance technician or junior account handler - entry is with usually with at least four GCSE's/S grades (A*-C/1-3) including English and maths. Some people who have gained experience in a broking or insurance company, as technicians or junior account handlers, progress to broker training. This is often after achieving qualifications such as those offered by The Chartered Insurance Institute.

It may also be possible to enter insurance broking through an Apprenticeship in retail financial services.

Apprenticeships and Advanced Apprenticeships provide structured training with an employer. As an apprentice you must be paid at least £95 per week; you may well be paid more. A recent survey found that the average wage for apprentices was £170 a week. Your pay will depend on the sector in which you work, your age, the area where you live and the stage at which you have arrived in the Apprenticeship.

Entry to Employment (e2e) can help to prepare those who are not yet ready for an Apprenticeship. In addition, Young Apprenticeships may be available for 14- to 16-year-olds. More information is available from a Connexions personal adviser or at www.apprenticeships.org.uk.

There are different arrangements for Apprenticeships in Scotland, Wales and Northern Ireland.

For further information visit My World of Work www.myworldofwork.co.uk/modernapprenticeships, Careers Wales www.careerswales.com; and for Northern Ireland contact www.careersserviceni.com.

A Few More Exams You Might Need

Entrants are trained by experienced colleagues. Training usually combines practical experience with study for professional qualifications. Brokers usually gain experience of a broad range of business areas before specialising.

Many brokers study for the qualifications offered by The Chartered Insurance Institute (CII). Study can be by distance learning, online learning and part-time study, including day release, block release and evening classes. Qualifications include:

The CII Certificate in Insurance - there is no entry requirement.

The CII Diploma in Insurance -entry is with either the CII Certificate in Insurance, or four GCSE's (A*-C) or equivalent.

CII Advanced Diploma in Insurance - entry is with either the CII Diploma in Insurance, or three A levels or equivalent.

Those who achieve the CII Advanced Diploma and have five years' experience can apply for Chartered status.

Lloyd's brokers and some other brokers working within the London market are expected to pass the Lloyd's and London Market Introductory Test. Study is via an online course book, with optional two-day and evening courses for revision leading up to the exam.

Brokers may attend courses run by the CII and by BIBA. They may also work towards the Institute of Financial Services' (IFS) Certificate of Regulated General Insurance (CeRGI).

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Skills and Personal Qualities Needed

An insurance broker should:

  • Have good communication skills, verbally and in writing.
  • Be confident working with numbers and computers.
  • Be capable of building good relationships with underwriters, clients and others.
  • Work well with a wide range of people.
  • Be confident.
  • Be trustworthy and have integrity, placing clients' interests first.
  • Be logical and organised.
  • Be good at report writing.
  • Have strong negotiating ability.
  • Be analytical and able to gather and absorb complex information quickly.
  • Be business-minded.
  • Be knowledgeable about the insurance market.
  • Have an awareness of FSA regulations.

Your Long Term Prospects

Brokers usually begin by gaining general insurance-broking experience. It can then be possible to:

  • Manage a team of brokers or several branches of a broker's company.
  • Specialise in one type of insurance, either for a small specialist firm or in a specialist department of a large firm.
  • Specialise in claims broking, sales management or new business development.
  • Move into related work outside broking, such as underwriting, loss adjusting or compliance.
  • Set up their own broking business.

Brokers may find progression quicker if they move between employers. That might mean moving to another geographical area.

Work abroad is possible.

Get Further Information

British Insurance Brokers' Association (BIBA),
BIBA House, 14 Bevis Marks, London EC3A 7NT
Tel: 0844 7700 266
Website: www.biba.org.uk

The Chartered Insurance Institute (CII),
42-48 High Road, South Woodford, London E18 2JP
Tel: 020 8989 8464
Website: www.cii.co.uk

Financial Services Skills Council,
51 Gresham Street, London EC2V 7HQ
Tel: 0845 257 3772
Website: www.fssc.org.uk

Institute of Financial Services, IFS House,
4-9 Burgate Lane, Canterbury CT1 2XJ
Tel: 01227 818609
Website: www.ifslearning.ac.uk

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