Towergate:: the price of being "more corporate"!?


It is a rare occasion when I praise Aviva for their strategic decision-making but this is one such occasion! However, I was immediately reminded of the spat of a few years ago that saw Towergate and Zurich “agree to disagree” over respective strategies.

tripWhilst BIBA attempt to appease the most blinkered of their membership by “wasting” money on a Deloitte review and a declaration that they intend to fight an EU move toward hard [commission] disclosure, the reality of a badly broken model is glaringly obvious…

A source claimed that the network decided to disengage after it had become frustrated at Aviva’s lack of understanding of the model and the value it offered the provider: somehow I doubt it is a failure to understand the model and more to do with a lack of faith in the ability of the model &/or Towergate to adapt to survive a turbulent economy and in the future FS landscape.

Unsurprisingly there is no mention of the “value” that is LOST to customers through the network’s “central charge” and unsustainable commission rates! Both of which impact their (Aviva’s) ability to achieve underwriting profit or to offer, reduced, sustainable rating at a time when the customers’ needs far outstrip this, or any other network’s demands: driven by their need to keep on selling in an attempt to outrun the tail of their own making…it didn’t work for the banks and it may not work for them for exactly the same reasons.

A spokesperson for Aviva responded: “Our decision is based on our commitment to build strong, local relationships with our brokers to ensure that they get the best deals with Aviva.

Read more of this post