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Future looking bright for insurance brokerages

Insurance broking is forecast to be the third-best performing industry in Australia over the next 12 months, according to a recent report by IBISWorld.

As you make plans for your insurance broking business for the coming financial year, you can take heart from a recent forecast that the industry’s revenue is expected to grow by 7.2% in 2010/11.

Business information research and analysis group IBISWorld predicts the industry’s revenue will reach $11.2 billion this financial year.

Employment is forecast to grow at 2.4% and wages at 3.1%.

“IBISWorld forecasts rapid growth in premium pricing as Australian insurance carriers strive to recoup underwriting capacity lost on recent investment activities,” the report says.

“This will result in substantial revenue growth for brokerage firms since brokers earn commissions on the size of the premiums written.

“As brokers distinguish themselves from direct insurance sellers through a great emphasis on advisory services and financial management, they will increase profitability and allow for both employment and wage growth.”

Insurance broking came third behind organic farming and online information services as Australia’s fastest growing industries.

The top five growth industries in 2010-11

Rank Industry Revenue growth (%) Total revenue ($ billion)
1 Organic farming +15.1% 0.45
2 Online information services +8.7% 1.56
3 Insurance brokerage +7.2% 11.20
4 Mobile telecommunications carriers +6.9% 19.6
5 Alternative health therapies +6.5% 3.46

 
 
 
 
 
 
 
 
 
 
 

The bottom five growth industries in 2010-11

Rank Industry Revenue growth (%) Total revenue ($ billion)
1  Insulation Services  - 24.1  0.84
2  Wired telecommunication services  - 4.8  11.10
3  Paper manufacturing  - 3.1  2.68
4  Video hire outlets  - 3.1  1.04
5  Grape growing  - 3.0  1.50

 
 
 
 
 
 
 
 
 
 
 



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