The Brief

SBS Insurance approached Accountancy Capital at a point where the business needed senior finance leadership that went beyond what the existing finance function could provide internally. The business was growing, the complexity of its insurance portfolio was increasing, and the management information available to the board and senior team was not keeping pace with what the business needed to make well-informed commercial decisions.

Adrian Lawrence FCA was engaged as Fractional Finance Director and CFO to provide the senior finance leadership the business required on a part-time, retained basis. The engagement covered three interconnected workstreams: the development of meaningful management information including drill-down reporting into claims profitability; the strengthening of the financial controls framework; and ultimately the recruitment of a permanent Financial Controller to manage the day-to-day finance function with Adrian providing ongoing strategic FD oversight. See Fractional Financial Controller, Insurance Intermediary FC Recruitment and Fractional CFO Rates UK for the engagement models and rate context.

The Challenge

The management information challenge at SBS Insurance was one that many insurance intermediaries and MGA businesses encounter as they scale: the underlying data on claims, premiums, commissions and expenses existed within the business’s systems, but it was not being assembled into the structured, drill-down reporting that the board needed to understand the profitability of the portfolio at a granular level.

Without claims profitability reporting at the product or line level, the business could see its overall financial performance but could not easily identify which parts of the portfolio were generating strong margins and which were diluting them. In an insurance business, this distinction is commercially critical — the same overall combined ratio can conceal a small number of highly profitable lines and a larger number that are marginal or loss-making. Pricing decisions, underwriting appetite and distribution strategy all flow from this analysis, and without reliable claims profitability data at the right level of granularity, those decisions were being made on incomplete information.

The controls challenge was related. A growing insurance business that is processing increasing volumes of premiums, claims settlements and commission payments needs a controls framework that ensures the accuracy of those transactions, their correct coding and the integrity of the financial records they produce. The CASS client money rules applicable to insurance intermediaries add a further layer of control requirement around the segregation and reconciliation of client money that goes beyond general commercial finance controls. See CASS Accountant Recruitment and FC at FCA-Regulated Firms for the FCA-regulated firm finance context.

The MI Development Workstream

The first and most immediately impactful workstream was the development of the management information framework. Working with the existing systems and data, Adrian designed and implemented a reporting structure that gave the board and senior management team meaningful visibility of financial performance at the level they needed to manage the business.

The centrepiece of the new MI framework was the drill-down claims profitability report. This report allowed the business to analyse claims experience and profitability at multiple levels — by product line, by distribution channel, by underwriting year, and by claims type — in a format that non-finance board members could read and interrogate without requiring finance team support for every analysis. The structure of the report was designed around the specific questions the board was already asking but could not previously answer from the standard financial reporting.

The drill-down claims profitability analysis revealed the kind of commercial insight that is only visible when the right data is structured correctly: lines where the claims experience was better or worse than pricing assumptions, channels where acquisition costs were disproportionate to the business written through them, and periods where reserving had been conservative or aggressive relative to the claims development that subsequently emerged. Each of these insights directly informed commercial decisions by the senior team that would not have been possible from the previous management accounts alone.

The Controls Strengthening Workstream

Alongside the MI development, Adrian reviewed and strengthened the financial controls framework across the business. This workstream covered the authorisation and approval framework for payments and commitments, the month-end reconciliation process for the key balance sheet accounts, the management of the CASS client money position and the controls around premium collection and claims settlement processing.

The controls review identified specific areas where the growing volume of transactions had outpaced the controls framework designed for a smaller business. In each case, the strengthening of the control was implemented practically rather than theoretically — documented procedures, clear accountability, a reconciliation cadence and an escalation path for exceptions — rather than as a policy document that sat in a folder and was never applied.

One of the outcomes of the controls strengthening work was a cleaner audit process. The improved reconciliation framework and the clearer documentation of key accounting positions reduced the number of auditor queries at the year-end and gave the auditors a higher level of confidence in the financial statements. In an FCA-regulated insurance business, the quality of the year-end audit relationship and the cleanliness of the audit sign-off are not purely financial management metrics — they contribute to the firm’s regulatory standing and its ability to demonstrate sound financial governance to the FCA.

The FC Recruitment

The third workstream — recruiting a permanent Financial Controller to manage the day-to-day finance function — was the natural culmination of the first two. Having built the MI framework and the controls infrastructure, the business needed a capable FC to run both on an ongoing basis, with Adrian continuing to provide strategic FD oversight at the fractional level.

The brief for the FC was specific: a qualified accountant with insurance sector experience, capable of owning the monthly close and the management accounts production, managing the external audit relationship, maintaining the CASS reconciliation and producing the board-level MI pack that the drill-down reports framework had established. Accountancy Capital ran the FC search, and the placed candidate brought direct insurance intermediary experience that allowed them to take ownership of the function rapidly without an extended learning curve.

The combination of the fractional FD engagement and the permanent FC hire produced the finance function structure that the business needed at its current stage: strategic financial leadership from Adrian at the FD level, operational finance excellence from the newly placed FC, and a management information framework that gave the board the visibility they needed to manage the business effectively. See Insurance Intermediary FC Recruitment and FC Recruitment for the permanent FC recruitment service.

What This Engagement Demonstrates About the Fractional FD Model

The SBS Insurance engagement is a clear example of the fractional FD model at its most effective. A business at this stage of development — growing, increasingly complex, operating in a regulated sector — needs genuine FD-level financial leadership: the commercial judgement to design useful MI, the technical knowledge to strengthen controls in a regulated environment, and the recruitment expertise to identify and appoint the right permanent FC. It does not necessarily need a full-time FD from day one.

The fractional model allowed SBS Insurance to access that FD-level capability on a cost-effective basis while the MI framework, the controls and the permanent FC were being put in place. Once the FC was appointed and settled into the role, the fractional engagement shifted to strategic oversight — a smaller time commitment at FD level supporting a finance function that was now well-structured and well-led. See Fractional Financial Controller, When Does a Business Need a Fractional CFO and Fractional CFO Rates UK for more on the fractional engagement model and when it is the right solution.