Why is some insurance not available to buy directly from an insurer?

Some cover only exists because an insurer, or a Lloyd's syndicate, hands the authority to price and accept it to a specialist underwriting agency. That agency usually reaches the market through appointed brokers, not the public. Where that's the structure, there's no direct option to compare against, because the arrangement was never built to sell that way.

Insurance Broker vs Buying Direct: Why Some Cover Only a Broker Can Get

Q: Is it better to use an insurance broker or buy insurance directly?

For straightforward, low-risk cover, buying direct can work fine. For cover with a narrower field of insurer appetite, like high risk trades or non-strata unit blocks, broker access to the wider market matters more, sometimes it's the only way to reach an insurer that'll look at the risk at all.

Q: Can high risk trades buy public liability insurance directly from an insurer?

Some can, but the field narrows fast for trades involving height, structural demolition, hazardous materials or heavy plant. Most of what's left for these trades sits with specialist underwriting agencies reached through a broker, not a mainstream direct channel.

Q: Why is non-strata unit block insurance hard to source without a broker?

Fewer mainstream insurers write block of units cover direct every year, because one event can hit several tenancies under one roof instead of one household. As that appetite shrinks, more of what's left sits with specialist markets a broker can reach and a direct search can't.

Buying insurance direct works for everyday cover. For high risk trades and non-strata blocks, a broker often reaches markets you can't buy from directly.

Buying insurance direct works fine for a lot of everyday cover. Car, home, a straightforward small business pack, mainstream insurers sell these directly and price them competitively. A broker’s real value there is time, comparison and claims support, not access. That changes for a narrower band of cover. High risk trades and non-strata unit blocks aren’t just harder to compare online. In some cases there’s no direct option to compare at all, because of how the underwriting sits behind the policy.

Broker only

how most Lloyd's-backed cover for high risk trades reaches the market

Fewer each year

mainstream insurers still writing non-strata block of units cover direct

0 comparison sites

list either of these covers, because there's no direct product to list

Is it better to use an insurance broker or buy insurance directly?

For low-risk, high-volume cover, buying direct is a reasonable option. Mainstream insurers compete hard for standard car, home and small business risk, and a direct quote is usually quick to get.

That stops being the relevant question once a risk sits outside what mainstream insurers write. A broker’s job shifts from convenience to market access: finding the specific insurers or underwriting agencies still willing to look at the risk. Once a risk moves into that band, the two options aren’t really interchangeable anymore.

Why is some insurance not available to buy directly at all?

Some cover only exists because an insurer, or a Lloyd’s syndicate, hands the authority to price and accept it to a specialist underwriting agency. That agency does the underwriting, but it usually reaches the market through appointed brokers, not the public.

Where that’s how a class of business is structured, going direct isn’t just inconvenient. It isn’t available at all. There’s no comparison site to check and no insurer call centre to ring, because the arrangement was never built to sell that way.

What is a Lloyd’s binder or coverholder?

A binder is a delegated underwriting authority. A Lloyd’s syndicate hands it to a coverholder, usually a specialist underwriting agency, letting that agency accept, price and issue policies on the syndicate’s behalf within an agreed scope.¹

Coverholders mostly reach the market through appointed brokers, not direct to the public. For the risk categories that rely on this structure, that has one practical effect: a broker with a relationship to the right coverholder can place cover a direct search won’t find at all.

Can high risk trades buy public liability insurance directly from an insurer?

Some can. Others sit in a narrower part of the market where mainstream insurers barely look. High risk trades like scaffolding, demolition, asbestos removal, excavation and crane hire carry exposure to height, structural collapse, hazardous materials or heavy plant, and that’s exactly the kind of exposure a standard business insurer doesn’t want.

Most of what’s left for these trades sits with specialist underwriting agencies, reached through a broker rather than a direct channel. A trade that’s been declined once, or found nothing searching online, hasn’t necessarily run out of options. It’s more likely run out of the options a direct search can find.

A decline from one insurer, or a blank search online, doesn't mean the market has run out of options. It usually means a direct search has.

Why is non-strata unit block insurance hard to source without a broker?

A non-strata unit block is a residential building with more than one dwelling on a single title, with no owners corporation. Insurers treat it as aggregated risk: one fire, one burst pipe or one storm can hit several tenancies at once instead of one household, and that changes the size of a potential claim.

Add rising rebuild costs and more frequent severe weather claims, and fewer mainstream insurers write this cover direct every year. As that appetite shrinks, more of what’s left sits with specialist markets a broker can reach. A block of units policy arranged through a broker searches that wider field, instead of relying on whichever mainstream insurer still happens to quote it direct.

The same pattern turns up elsewhere too. Professional indemnity for certain engineering disciplines and for financial institutions works the same way: a narrower field of insurers with the appetite to underwrite it properly, reached mainly through brokers rather than direct channels.

Does using a broker cost more than buying insurance directly?

Broker remuneration is usually built into the arrangement, not stacked on top of a directly available price. For standard, high-volume cover where a real direct price exists, that’s a fair comparison to make.

For cover with no direct-to-consumer version in the first place, high risk trades and non-strata blocks included, there’s no direct price sitting on the other side of that comparison. The real question isn’t whether a broker costs more than going direct. It’s whether going direct is available at all.

Key Takeaways

Buying direct works fine for everyday cover. A broker's value shifts to market access once a risk sits outside what mainstream insurers write.
Some cover only exists through a Lloyd's binder, a delegated underwriting authority reached through appointed brokers, not sold direct to the public.
High risk trades like scaffolding, demolition and crane hire mostly rely on specialist underwriting agencies, not a mainstream direct channel.
Non-strata unit block insurance faces shrinking appetite from mainstream insurers, pushing more of the market towards specialist channels a broker can reach.
Where there's no direct option, the question isn't broker cost versus direct cost. It's broker access versus no access at all.

Been declined direct, or can’t find a quote at all for a specialist risk? Cipher can search the wider market for you. Get in touch.

The information in this article is general in nature and does not constitute legal, financial or insurance advice. Please speak with a qualified adviser about your specific circumstances.

Underwriting: Lloyd’s in Australia, APRA ↩