Q&A: Julian Tomlinson, Alps

What’s on the Alps agenda right now?

There’s always a lot of legislative change happening – and we try to make sure we can respond to it quickly.

One area we’re focusing on that is relevant to this is pet insurance. The government is making it easier for tenants to own pets, which isn’t a bad thing, but it does raise new challenges for landlords. 

As soon as legislation like this comes in, brokers tell us what their customers need, and we respond quickly – like when we introduced a pet damage protection product earlier this year.

When the FCA took action on it, we had brokers coming to us and saying, ‘Oh, crikey, have we done anything wrong?’ So, we spend a lot of time working with the underwriters and carriers on these products, assessing the appetite, defining the scope, and staying ahead of any potential compliance questions.

We’re also concerned that a part of the market still struggles with access to service after an injury, and you can see that reflected in the returns. That’s why we’re banging the drum for motor legal expenses insurance.

We’re seeing a lot of supply for very cheap motor legal cover, but it often excludes personal injury claims.

What do you think is wrong with the legal expenses insurance industry?

The biggest issue with the legal expenses insurance market right now is the lack of understanding of its value. We’re constantly banging the drum, telling people: ‘This is an important product – you need to buy it.’

There’s still a lingering misconception that legal expenses coverage is something you get for free, or that insurers will simply hand over commissions. That’s not the case, and it’s something we need to challenge.

The real need for this cover becomes clear when someone finds themselves in a tough spot – like a nurse who’s lost income and needs compensation to cover the shortfall. But too often, people only realise its importance when it’s too late.

We’re also seeing a rise in extremely cheap motor legal cover, but often, that’s because it excludes personal injury claims. 

Sure, it might help recover uninsured losses or excess payments, but beyond that, where’s the real value? If it won’t step in when you need it most, is it really doing its job?

What kind of conversations are you having with brokers at the moment?

One of the key themes from last year was the hardening market, particularly in the high-net-worth space. Rising costs have been a major challenge.

Our clients have operational costs, everyone is looking at National Insurance increases, the living wage going up and all that kind of stuff. They’re very concerned about their pricing.

From that, we’ve seen a bit more appetite for commercial legal expenses because businesses are feeling threatened; the government is making it very difficult for businesses.

Look at entrepreneurs’ relief, which is now known as Business Asset Disposal Relief, that’s going up to 18% over the next two years, whereas it had been 10. It’s another example of friction on the growth side of the economy – small business owners and private equity investment. 

Alps was one of the first firms back on the scene to sell guaranteed asset protection insurance following the Financial Conduct Authority’s unpausing of sales. What’s the appetite been like since then?

We did a small amount of Gap before the pause, but it was right up our street.

When the FCA took action on it, we had brokers coming to us and saying, ‘Oh, crikey, have we done anything wrong?’ So, we spend a lot of time working with the underwriters and carriers on these products, assessing the appetite, defining the scope, and staying ahead of any potential compliance questions.

In terms of demand, it’s been strong. Mentioning compliance always brings a bit of a groan, but when situations arise, there’s reassurance in knowing we’ve already thought things through. If regulators or inspectors come knocking, we’ve got everything ready. 

In its results last year Alps signalled it was increasing its M&A appetite. How does that fit with your overall growth plans?

We’re actively looking at acquisitions, focusing on small firms that provide vehicles or operate in our existing lines. Ideally, we want businesses with established infrastructure, where a joint venture could be beneficial.

Another avenue is finding providers with innovative products that align with what we do. If you can find a good fit business with the same values, you could achieve three years’ worth of organic growth.

From an organic growth perspective, we’re seeing more smaller brokers struggling to find solutions. As regulatory costs rise, some providers are turning brokers away, and telling them they’re too small to work with, when that happens, those brokers come to us.

We’re aiming for 1m policies, and we’d like to get there before three years are up. It’s a nice round number and everyone in the office is excited about it.

Sometimes, it’s easier to aim for a bigger number and a bigger goal than it is to say ‘Let’s grow by 20%’, because it’ll encourage the team to succeed, innovate and really smash it. 

You introduced an AI claims system last year. What have the results been like?

From an efficiency standpoint, it’s been a great investment, delivering a 13% improvement straight away.

The way we’ve designed it, the system assesses incoming claims like a sorting tool – it categorises jobs by skill level and automates lower-level tasks. It’s almost like Tinder for claims! 

The AI processes routine work, like handling excess receipts or responding to basic queries, which frees up our people to focus on value-added interactions. 

That, in turn, improves the customer experience, builds trust, and ultimately makes for a more efficient operation.

We’re always excited by technological advancements, but we’re also acutely aware it’s people who make the business, and the technology supports and enhances what the people do. 

The ways you can use AI and plug it into a business are reminiscent of when businesses first started using the internet.

You recently appointed a new managing director. What was the thinking behind promoting internally?

Michelle [O'Reilly] has been with us for a long time. 

She’s a qualified lawyer, has worked across various areas of the business, and spent seven years as operations director. She was already a key part of the senior leadership team before stepping into this role.

When reviewing our internal structure, we saw an opportunity to be leaner. The leadership team had grown a little too large, so streamlining it has made us more dynamic and responsive. 

Michelle’s deep experience working directly with brokers makes her well-placed to oversee both service delivery and product development.