The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A leading insurance broker is targeting a 5 per cent market share for his start-up in the medium term, telling Tribune Business: “I’m not looking to take over the world.”

Brian Moodie, Sunshine Insurance Agents & Brokers’ former 17-year president, said his new business was aiming to “carve out a little niche” by providing “value added” risk management services to clients.

Speaking after RMS Insurance Agents & Brokers began operations last Thursday, Mr Moodie explained that his “game plan” was to provide risk management services to corporate clients - chiefly small and medium-sized businesses, and condominium developments.

Apart from advising them on the best insurance products and coverage available, Mr Moodie said RMS - which stands for Risk Management Solutions - would offer expertise designed to minimise the likelihood clients would suffer a loss.

Aiming for “slow but steady growth”, he told Tribune Business that his 10-year goal was for Sandyport-based RMS to achieve a 5 per cent market share of the Bahamian property and casualty insurance market’s gross written premiums.

Given that the total market size is estimated at between $350-$400 million annually, Mr Moodie said that placed RMS’s 10-year target at $20 million worth of gross written premium.

Revealing that he had invested his entire retirement fund into his new entrepreneurial venture to ensure it succeeded, Mr Moodie said he was not ruling out an eventual move by RMS into external insurance.

“My background is in risk management, which I have a degree in,” he told this newspaper. “I believe there’s room for that here.

“My game plan, and my target clients, are small and medium-sized businesses and condominium developments - people that will not only benefit from insurance products but a bit of risk management advice.

“The reality is that no matter how good or well-structured your insurance programme is, the idea is to avoid making a claim in the first place.”

Mr Moodie said that even if business interruption or ‘loss of profit’ policies ultimately covered all of a Bahamian company’s losses, that business would “still be out of time and have the stress of putting the operation back on its feet”.

Contractors might be needed to rebuild the company’s property, he added, while inventory, equipment and machinery have to be replaced. Office premises may also have to be refurbished and refurnished.

“The whole idea is to employ a bit more risk management with clients to avoid these losses and minimise the chances of these risks happening,” Mr Moodie told Tribune Business.

“There are also risks you can’t insure against. That’s where I see our value added: To reduce the chance of having a loss.”

The former Sunshine president added that he would also focus on “innovative and creative ways” to keep insurance premiums competitive, adding: “We’re fully aware that VAT is impending in July, and that people will be looking to minimise costs.

“We’re fully in tune with that, and are looking to work with clients to get the most competitive costs we can source.”

Few would bet against Mr Moodie’s prospects of successfully growing his own business, given that he took Sunshine from a two-man operation in 1996 to one that featured 25 staff - 15 in insurance, 10 in IT and accounts - by the time he resigned in September 2013.

“When I started back in the day with my former company, Sunshine, it was an extremely small business with less than $1 million in annual gross written premium, and we grew it by a significant factor,” Mr Moodie said.

“I’m not looking to take over the world here with RMS. We’re not expecting to grow exponentially. We want to carve out a little niche and service my customers properly.

“I want to give proper value-added service to clients, put it in front of them and see if it’s something they want to pursue. The whole idea is to minimise the chances of a loss happening, and give clients advice to mitigate against any potential losses.”

Mr Moodie conceded that RMS would be a relatively small, niche player in the short-term, adding: “Slow but steady growth is what I’m looking for.”

He estimated that six-seven brokers controlled a collective 85 per cent of the Bahamian property and casualty insurance market, led by Insurance Management and J. S. Johnson. Close behind were the likes of Nassau Underwriters, Orry J Sands and Star General.

Still, despite the high market concentration and difficulties newcomers will likely encounter in penetrating this, Mr Moodie expressed optimism that RMS will eventually become a strong niche player.

“Ultimately, my medium-term goal is to get somewhere around 5 per cent market share, $20 million,” he confirmed to Tribune Business.

“I’m sinking my retirement fund into this to make sure it works. It’s a relationship-driven marketplace here, and I believe I’m respected enough for people to do business with me.

:”My agenda is to pound the pavement, knock on some doors and give people some value added. Hopefully they will be attracted to that and come with me.”

Mr Moodie acknowledged that he was ‘bucking the trend’ in the Bahamian insurance industry, which over the past several years has seen numerous small brokers/agents exit the market.

One factor driving the consolidation trend has been the increased regulatory requirements, and Mr Moodie said: “I’m kind of fighting the tide a little bit.

“With the new legislation, we’ve seen quite a number of small brokers fall by the wayside through increased demands put on them in terms of professional indemnity insurance, audits.

“I think that’s a good thing for the market; to make sure the general public get advice from properly qualified insurance brokers.”

Mr Moodie said that after resigning from Sunshine in September, it took 12-14 weeks to get all the necessary Insurance Commission and government approvals in place.

Once that process was completed, RMS spent December equipping its office in Sandyport. Mr Moodie said the business has started life with himself and one other staff member, with a receptionist to be added shortly. He told Tribune Business that RMS had already signed contracts to write business for several Bahamian underwriters, while two other agreements were pending completion.

“We represent almost all of the major markets in the Bahamas, and are working on one or two others,” Mr Moodie added. “All of the underwriters willing to write through independent brokers, we represent, with the exception of two.

“Right now, we’re waiting for those to finalise intermediary agreements. Hopefully, that will take care of itself in short order.”

Given that Sunshine was the Bahamian correspondent for Marsh, the globally-renowned insurance broker and captive manager, Mr Moodie said he was not ruling out a move by RMS into the external insurance market.

“For the time being we’ll be domestically focused, and it’s not really my short-term goal,” he told Tribune Business of external insurance.

“It’s the local business that will pre-occupy me for the near future, but it’s something we have considered because of my risk management background.

“It’s something I may include in the overall business plan in the future. I’m not saying no. I’m bullish on the future of the external insurance market ion the Bahamas. Marsh’s decision to establish a licence here is a significant step forward.”