Don’t cast a clout ’til May is out
May’s weather has been unpredictable – we have had thunder, hail, sunshine and winds – very different to the calm April we experienced. We have seen an increase in claims this month and as people start going back to work and life returns to normal we hope to see more claims coming through compared to last year.
May has seen a lot of alarming press coverage about rising construction material prices due to Brexit, the pandemic and increased construction activity, so we have summarised the situation below and how it affects property claims and our suppliers and clients. We also have news on some changes to the senior management team and an update on our digital roadmap. And this month’s team profile is on the Supplier Performance team.
Digital journey continues
Two new digital projects went live this month. The first is Optical Character Recognition (OCR) which we are using to automatically open claims on Pulse (our claims management system) from client instructions. This is live for new instructions on Virtus claims and we expect to roll it out to other clients soon. This new technology reduces the administration for our claim handlers, allowing them to spend more time proactively progressing claims. For Virtus this will be a great help during surge events when new instructions can increase ten-fold over night.
We have also introduced automated text and emails where Pulse will automatically send text messages and emails to confirm appointments, changes of dates and any other key milestones or activities in the life of a claim. Initially we are using this technology for surveyors – to let them know when a job has been assigned to them and to confirm survey dates and any changes or cancellations to survey visits. We will roll this out to customers over the next few weeks and will increase the number of communications that use this technology. Already this is creating more efficiencies for our Control Centre, and for our surveyors who will simply need to open up the Scoper app to get the claim details and start scoping.
Senior management update
We are delighted to announce that James Bush has been appointed to the MA Group Board as Chief Commercial Officer. James has held a number of senior management and board level roles in the construction insurance sector over the past 20 years, joining MA Group in late 2017 to establish NHCC. James will take responsibility for strategic sales across the MA Group whilst also retaining full responsibility for NHCC.
We are also delighted to announce that Tony Derbyshire, Group Supply Chain Director, has joined the MA Group Board too. He will continue managing the MA Group supply chains and branches.
Both James and Tony are well qualified to help us continue the successful journey of MA Group and to develop MA Group Property Claims and NHCC further.
We are sad to announce that Alex Kilpatrick will be leaving MA Group to take on a new role with a major loss adjuster and we wish him all the best for the future.
And finally, we are very pleased to announce that Tom Brookes has accepted a promotion to the role of Account Manager with immediate effect. He already has considerable experience in supporting our clients and is a great addition to our Account Management team who do sterling work as the “voice of the client” within the MA Group.
Construction materials prices
There has been plenty of news coverage about inflationary prices for construction materials due to shortages (Brexit and the pandemic) and increasing demand for construction projects in the UK. The eye-catching headlines, such as timber and steel prices up by 80%, are alarming when read at face value, but are less alarming when you understand the detail in relation to our industry.
In the year to March 2021, construction material prices increased by 9% for repair and maintenance work according to the Department for Business, Energy and Industrial Strategy, with a 1.5% increase in the month of March alone. The greatest price increases were in concrete reinforcing bars (19.8%), fabricated structural steel (17.6%) and imported sawn or planed wood (16.6%) – all products that represent a very small amount of the construction materials used in our reinstatement works. However, there were also price decreases for materials such as screws etc. (-13.8%), ready-mixed concrete (-0.5%) and kitchen furniture (-0.4%).
Price increases are being experienced in the following areas that impact our suppliers’ profits through the fixed line items in schedules of rates:
Paint – Supplies to the UK are restricted due to global shortages and the cost of shipping containers.
Plaster and plasterboard – There has been an ongoing plaster shortage for several months, but supplies are much improved now compared to this time last year and even this time a few months ago.
Insulation – There has been restricted availability of insulation for several months, particularly PIR insulation and wool fibre insulation.
Roof tiles – Roof tiles were the most common material shortage reported by roofing contractors in the final quarter of 2020, and they continue to be short in supply with tiles such as Marley and Sandtoft showing lead times of up to 6-8 weeks. However, very few of our insurance claims involve roofing work and where they do there is scope for provisional sums when costs exceed the rates.
The high price increases are mainly occurring on materials that can be charged on to insurers as provisional sums (at cost + markup). They are not built into the fixed line items so they are not impacting our suppliers’ profits on insurance works – insurers are already picking up the extra costs.
Timber – There has been a nationwide shortage of timber since the first lockdown, and imports will be an issue for the foreseeable future, with MDF, veneers and solid wood particularly affected. There is unlikely to be any improvement in timber supplies this year as any timber coming into the UK has already been pre-sold and global demand is outstripping supply.
Steel and concrete – Steel is also continuing to be in high demand globally and
lead times for concrete tiles have tripled to three months, according to the National Federation of Roofing Contractors.
There are reportedly also shortages of PE and PP plastics, screws, fixings, plumbing items, sanitaryware, shower enclosures and electrical products and appliances.
Some of our clients brought in inflationary increases for materials at the start of 2021 and most of them have paid additional fees to cover the extra costs of the pandemic since spring 2020. This has helped our hard-pressed suppliers, but we are making our clients aware that material price increases need to feed into their schedules of rates when they are reviewed and that provisional costs are increasing in line with inflation already.
Meet our Supplier Performance Team
This month we are profiling our Supplier Performance Team. They are responsible for managing the performance of all the suppliers across the MA Group networks.
Stephen Pomfret Sandy Dobbie Paul Parish Justin Scargill Christine Lillywhite Marc Etchells
Stephen Pomfret is responsible for the Revival franchise network. He is a member of the Royal Institution of Chartered Surveyors and has a Postgraduate Diploma in Business Management. He has extensive experience having worked as a loss adjuster all over the world and as a supply chain manager for insurers before joining MA Group nine years ago. He enjoys cycling, reading, gardening and watching rugby from the sofa with a beer (or two) on a Saturday afternoon.
Sandy Dobbie started his career as a roofer and roughcaster with a local authority where he gained his advanced crafts accreditation. He has an HNC in construction practice and has lots of construction experience as a contracts manager in a construction company, as a surveyor in the insurance industry and then as supply chain manager for a property claims manager and a major loss adjuster. He supports Glasgow Rangers and has represented Scotland at bowling. He also loves pinot grigio and thai food!
Paul Parish has been involved in the property insurance industry for over 35 years. He has worked in the loss adjusting field as well as directly for insurers. He is BDMA trained,holds accreditation with the British Pest Control Association and is now working towards becoming certified as a Member of the Chartered Institute of Building. He lives in Somerset and enjoys the peace and quiet of the countryside. He enjoys walking his dog, and has been an avid rugby player and scuba diver (preferring the English Channel to warmer waters).
Justin Scargill has been in the insurance industry for 34 years. He started out as a loss adjuster, working for large loss adjusting firms and insurers, before joining MA Group over seven years ago. He has a degree in business law and a masters degree in computing. He is an active member of a local running club, Stainland Lions, and enjoys hillwalking and going to gigs (pandemics allowing!).
Christine Lillywhite is our newest member of the team. Before joining MA Group she spent seven years working for a building contractor specialising in insurance repairs, new builds and major structural projects (including work at Westminster Abbey). Prior to that she spent ten years working for a large loss adjuster as a contractor performance manager. She lives with her partner in Essex and spends most of her weekends entertaining her nine-year-old stepson, two dogs and two horses.
Marc Etchells joined MA Group in Feb 2010 starting in the control centre operation before moving into the supply chain team seven years ago. He has his CII Certificate and is now our Procurement Manager, responsible for the recruitment, compliance and training of suppliers. Marc enjoys playing a variety of sports including football and golf, and plays darts for his local boozer.
MA Group MAD Awards
Chris Maggs a Project Co-ordinator in NHCC was the MADest person in MA Group in April 2021.
At a recent NHCC review meeting with a housebuilder client’s senior management team we received very positive feedback about the whole NHCC team with regard to the pre-handover inspections, outsourced customer care and software services that NHCC provide. However Chris was singled out for extra praise noting both the client’s team themselves and their homeowners have been very impressed by the way he deals with all issues thrown his way, and consistently delivers excellent customer service, with a smile.
Well done Chris, keep up the good work.