What is Premier Connections and when was it launched?
Premier Connections is a change of trading name for Premier Protection. Premier Protection launched in 2001, but the branding Premier Connections was launched at the start of this year. We have formed strategic alliances with other companies that we feel can deliver what our brokers require in this market.
What services do you offer?
Our core business is protection-based products, term assurance, critical illness, and income protection ‘ primarily products regulated by the Association of British Insurers (ABI). Our proposition was to focus on products that offer a good margin of profit for the broker. They are also some of the few products not regulated by the Financial Services Authority (FSA), so as a broker you are not bogged down by the regulatory constraints, paperwork and bureaucracy that comes with being part of a regulated network.
What is your mortgage proposition?
It is two-fold. We have a deal with some of the largest mortgage clubs, which has just been launched this year, and there is also a deal with the Professional Mortgage Packagers Association (PMPA), which again is a new offering. We recognised the need for a mortgage proposition, but did not want to form a conventional alliance with a single packager because if you are committed to one packager and their service standards let you down it reflects badly across the whole network. This way our members can decide which packager suits them.
Do brokers need any expertise to use the different services?
We vet brokers before they join. In addition, the ABI’s code of conduct is there to ensure companies like ourselves adhere to good practice, and it is our responsibility to ensure brokers are sticking to this. However, mortgage business is a separate issue. Brokers would not be able to transact business with any PMPA clubs unless they are MCCB-registered. By doing so their ‘fitness and competency’ requirements would have been taken care of.
What relationship do your brokers have with providers?
One of the first things we decided was not to have one agency that brokers placed all their business through. We wanted to set up something where they could interact with the provider or lender directly as if they had their own agency number. Everyone who joins has their own sub-agency number, which means they can chase commissions and get answers over the phone without going through us. This means they can act upon any queries quicker because the paper chain has been cut.
How many brokers do you have and how many are on the mortgage side?
We have 480 member firms, which totals around 2,000 practising consultants. The majority of which are already selling mortgages; they just were not selling them through us because we did not have a mortgage proposition until now.
How do you become a member, and do you offer support?
They would need to fill in an introductory pack, which gives us enough information to decide whether they will be compatible or whether a business development manager has to investigate further. Applicants are also credit checked and references are sought. We offer training on products, and also sales training to help them to explain the benefits to clients.
Will mortgage and general insurance regulation force more brokers to join networks?
It will certainly encourage brokers to think more about joining a network. They will have a choice of either joining some form of association or to be regulated directly through the FSA. Being part of a network means the entire necessary infrastructure they need in place is already there, so they can focus on generating business and seeing clients.
What compliance systems do you have in place?
We are in talks with an organisation that can deliver a menu-based system for compliance on mortgages. For example, rather than paying a network £2,000-£3,000 a year in fees for them to deliver the full mortgage compliance requirements, you could opt for a menu-based system if you wanted an audit facility that would be available separately at a couple of hundred pounds instead, which would be a one-off payment.
Will there be a noticeable difference with regards to compliance when the FSA takes over as statutory regulator in 2004?
Of course, but to what extent I just do not know because it has yet to be determined. But it is certain the FSA will be under the spotlight to deliver full and exacting compliance requirements, because that is what the public expects. Without a doubt it will be more onerous than what we have now.
Will all mortgage networks have to diversify to attract brokers in the future?
In order to survive I think you need to specialise in something, and Premier Connections has always concentrated on protection. But as a company a broker would expect the full service from one network, rather than attempt to get other products from various other networks as well. Networks have to diversify and in the future will have to offer additional services, but this may well be achieved through outsourcing deals with providers and lenders.
Ben Marquand is editor
