There is strength in numbers.
What is the FSP Solutions business model?
We are match makers specialising in instant gratification. We
introduce groups of insurers to groups of intermediaries at the
click of a button. Our product offering is more comprehensive
than any other independent aggregator in the intermediated
space in South Africa. We are not an underwriting manager.
We partner with insurers and sell their product via their rating
engines at their scientifically calculated rates. We provide one
entry point for the intermediary to instantly access multiple
insurer offerings via our Internet based application, or our call
What dif ferentiates you from your competitors?
There have been numerous attempts to copy our model.
Still, our insurer partners write more policies through us than
anywhere else where their rates are up against anti-selection,
where that channel is not independent and objective. We do
not influence the sale. Each insurer stands on equal grounds,
the only dif ferentiator is each insurer’s individual rating
methodology, brand and product offering. In most cases we
do all the administration for policies written via our portal.
Our intermediaries have one port of call to assist with all the
It hasn’t been easy to establish this model?
We were probably ahead of the market when we started out
in 2003 and as a result it was difficult to partner with insurers
that had at that stage not really invested in scientific rating
engines. Back then, Portfolio Management was the flavour of
the month and we believed from the outset that those days
were numbered. We have done countless demonstrations for
insurers through the years. The hard slog has fortunately paid
off during the last couple of quarters.
What systems do you use?
We have developed our own Internet-based application and
are constantly enhancing the system. It is a paperless, voice
logged administration application. We outsource our claims
functionality to ECA (Electronic Claims Administration),
FINANCIAL AND ADVISORY NEWS
FAnews spoke to Pierre van Huyssteen,
Marketing Director of FSP Solutions, to
uncover the drivers behind their success.
Match makers -
CELEBRATING 40 PRODUCTS
IN SEVEN YEARS
Santam appreciates the value of all our intermediaries, especially when
they’re as innovative and passionate as we are. That is why it is such
a pleasure to work with FSP. We’re confident that because of their vision
and like-minded thinking, our relationship will go from strength to strength.
Pierre van Huyssteen (FSP), Retha Botha (FSP), Leon Oosthuizen (MiWay)
ma (FSP), I
t Bergh (FS
Lucas Bothma (FSP), Rene Otto (MiWay), Retha Botha (FSP)
our preferred outsourced partner which has its own claims
application interfaced with ours. ECA currently manages
claims for Hollard, MiWay, New National and Santam.
Our IT and that of ECA is in-house and on hand for our
What services do you offer to intermediaries?
We do partial or full life cycle administration and provide
the intermediary 24/7 access to policy data and the
system. The intermediary has one entry point to his entire
client base, irrespective of the insurer offering. We assist
with cancellation and client retention ratios and take care
of all fulfilment and general administration.
Why do insurers make use of the services of FSP
We are non-biased, independent and over time we have
proven that our business model adds additional value
to the existing value chain. We only deal with insurers
that have rating engines and the process is a simple
plug-and-play. We offer insurers innovation, integrity
and business intelligence.
In most cases we do everything for the intermediary,
besides sourcing the client. We are an independent,
objective intermediated aggregator that gives the
intermediary choice and access to the widest range
of product offerings at a click of the button, or a quick
What is the way forward?
A couple of big players will have their rating engines on
towards the end of the year to complete our bouquet.
Some great system enhancements will be rolled out
during this year, and we are implementing ITC rating
scoring across the board. We look forward to increase
our broker and insurer policy
Lars Forssman (SCRM), Retha Botha (FSP), Steven Isaacs (Absa)
Pierre van Hu
), Retha Botha
echnology and the web are only two of the factors
that will influence the impact of the direct insurer
on the corporate and commercial market currently
monopolised by the traditional broker. The SME broker
may find it more challenging to compete against the onslaught
of the direct market, and more dif ficult to counter it with the
inaccessibility of certain facilities and insurers, due to high
Risk management is also increasingly becoming the
responsibility of the broker and with current legislative changes
and the impact of global warming, fresh categories of risk to be
considered will definitely prompt a few insurers to expand their
We have seen the launch of the Consumer Protection Act
(CPA) and there will unquestionably be a spin-off in the
commercial insurance environment. In partnering with a larger
commercial portal, brokers will be kept in the loop about
product enhancements and industry changes that influence
The right partners
FSP Commercial strongly believes in the potential of brokers
specialising in a certain market segment and being in the
position to give competitive, yet sustainable options to their
Although some UMAs still made underwriting losses, the
annual FSB report noted that the average niche insurer made a
substantial underwriting profit in comparison with those of the
traditional insurer. The key in the process is to select the correct
partners with a respectable track record and underwriting
margins. FSP Commercial currently deals with 26 partners,
varying from insurers specialising in most markets, to the
smaller UMAs that focus on a specific field in
The main benefit for a broker to partner with a facility like FSP
Commercial is the accessibility to a variety of facilities where
commercial lines can be placed, ranging from aviation and
marine to plant, all risk and travel insurance.
Premium pressures due to economic circumstances and the
underwriting cycle make it more dif ficult for a broker to deal
with only a small selection of product suppliers. With re-insurers’
underwriting results also under pressure in the local market,
there is also a need for placing collective policies. This might be
challenging as the required experience and agencies need to be
Dealing with industry experts, whether specific insurers or
underwriters, provides precious knowledge and information on
certain lines where a broker might not feel comfortable with
placing the business on their individual capability. When placing
your clients via a group umbrella, it also provides you with the
benefit of enjoying first-class service with the peace of mind of
having a big brother to assist with rate negotiations and tiresome
The insurer or underwriter on the other hand, also has the benefit
of lowering their operational expenses as there is an economy
of scale saving with regards to marketing their product and
Uncertainty is a likely part of any sales process, so when times
get tough you have to equip yourself with the necessary tools
to advance your offering beyond those of your competitors. FSP
Commercial has developed a refined distribution system that will
supply brokers with unparalleled products and support.