Amanda | 10th June 2021 - 6 min read
Each scheme begins its life as a small, sometimes underestimated idea. Schemes can allow the broker to carve out and provide their own particular niche. If you’re not in a specialist sector already however, researching which niche you should move into could seem intimidating. The best way to broach it, is to map out a few ideas … essentially here’s the licence to let loose on flip chart paper.
If hobbies lead you nowhere, look for trends. What’s hot right now? New sports, leisure activities, pastimes, is there an ‘in’? What are your nieces and nephews/god children/actual children doing? Sometimes the young do have the answers…
You wont solve it all, but you can 100% begin to sculpt an end product that will add value to this group.
“If you can find a group of businesses that are not being catered to in the open market and find the commonalities in them, there is a great opportunity for the broker and insurer to work together to develop a suitable scheme product.” – Nikki Crabb, Covea Insurance
Never a comfortable thing, but without looking at your competition you could easily enter the market with a host of other similar products. Research any competitors you think could be selling in this market, and decide whether or not you have a realistic opportunity to be successful with your product.
If you believe you can differentiate yourself enough, then go for it. But remember, you need to offer something that stands out. If there are good number of companies doing the same thing, this probably isn’t your niche … or any niche to be fair.
Important Note; Make sure the size of the community you’re targeting is big enough. You want a customer base that’s large enough to create a bespoke offering. If a competitor is dominating the market, you need to consider whether your idea if unique enough to make a sizable dent.
After all this research, you’re in a great position to pitch to a favourite/preferred insurer. Most of them will need a good-looking business plan – make sure you’ve identified the size of the market, risk types that you want to target, and levels of cover. Large insurers may take longer to make a decision in this process, so consider smaller MGAs as well that may be in a better position.
“We find that when you go to the mainstream carriers you’ve got quite a lot more hoops to jump through. They have a lot more departments and a lot more people who have to get involved.” Graham Whyatt, James Hallam
Important Note; Also, put some effort into the aesthetics of your business plan – even if this isn’t your strong point, pay a freelancer to make your document look designed and intentional. More professional, less thrown together.
Also, it’s always better with speculative schemes to have an existing book, so think about whether you can start writing this business on an open market wording, whilst you work on a bespoke product.
Although time consuming, this process can be a brilliant way of defining yourself as a specialist in the market and offering a well researched, well organised end product that really adds value.
Did you know, we’ve also written an article on the 4 things you must consider when building a successful insurance product!