Solipse/MSG1 huggingface dataset:
Setting The Scene

I joined Markerstudy Group as Chair in July 2021 at the propitious juncture of the private equity capital injection and group restructure. Markerstudy had been travelling on an exhilarating growth trajectory and I was delighted to join the operation at such a pivotal moment. The UK had just emerged from the pandemic and was carving out what 'normal' looked like. I was excited by the passion of CEO Kevin Spencer, and keen to embrace an organisation that had similarly aligned principles to my own. In April 2022, Markerstudy completed the purchase of BGL Insurance, welcoming approximately 1,700 new colleagues into the Group and swelling overall colleague numbers to upwards of 5,000. This also created a business with more than 6 million customers, able to benefit from Markerstudy's continuous development in digital capabilities, wide product footprint and mantra to put the customer first.
Today…

With our broad distribution footprint and omnichannel capabilities, we've seen significant historical organic revenue and earnings growth, strong margins and robust operating cash flow conversion. External factors have given rise to unprecedented opportunities and challenges in the insurance industry… climate change, legislation, cybercrime, geopolitics, inflation, restructuring and digitisation. From conducting our first full scope carbon footprint, to embracing GIPP, Markerstudy has positively addressed each of these factors. Markerstudy has a long track-record of successful M&A activity, with 25 acquisitions completed in the last 10 years and an extensive opportunity pipeline, supporting our forecast growth trajectory. Our investment has been focused on market-leading technology and data analytics capabilities, driving increased competitiveness, scalability and growth to all parts of the operation. Markerstudy enjoys strong, long-term relationships with brand partners and third-party brokers. We operate a fully integrated, end-to-end insurance platform, delivering scale and diversification and offering distribution, underwriting and related insurance services. In 2022, Markerstudy joined The British Insurance Brokers Association (BIBA) and we have continued our support of the Managing General Agents Association (MGAA). We have a strong management team with deep industry expertise and extensive experience, driving an ambitious culture and a vision to be the No.1 provider of general insurance services and innovative solutions to customers in the UK. Benny Higgins Chair of the Board

# CEO's Statement

Throughout 2022 the UK experienced considerable economic uncertainty as it lurched from one crisis to another, resulting in increases in fuel and energy costs, delays in the supply chain and a rising cost of living. All of which negatively impacted our customers, our colleagues and our business. Given these headwinds, and the acquisition of BGL Insurance in April 2022, it was deemed an opportune time to reassess our vision and values, to check they are still relevant in today's world and outline the strategies to propel us towards a more sustainable future.
Our Vision, Purpose And Values

Our Vision To be the No. 1 provider of general insurance services and innovative solutions to customers in the UK. Our Purpose To unite all colleagues within our Group to strive to reach their potential and support our goal of putting the customer first. To be a Group that achieves sustainable and profitable growth, nurtures differences, grasps all opportunities and embraces change - with a view to building a legacy for the future. Our Values I'm passionate about improving our customer service and colleague experience. In 2023 we launched refreshed values, where the acronym E.F.F.O.R.T is a quick reminder of each value: Embrace, Focus, Fun, Own, Responsible, Teamwork.
Colleague Engagement

With a community of over 5,000 colleagues, it is our ambition to build a more diverse, equal and inclusive workplace for everyone and in doing so nurture positive behaviours to foster a healthy, happy and collaborative workforce.

We rely on colleagues to help us shape the business for the future. Our annual colleague engagement survey 'Pulse' was distributed in September 2022, with more than 3,500 responses. The overall engagement and wellbeing indicator for the whole Group was 4/5 - which is deeply encouraging. 

There's more work to be done in this space, but we have exciting plans in place to help improve this score. Improving our Employee Value Proposition has also been a priority. Our colleague forum, Bright Sparks, enables ideas to be suggested that will improve our ways of working, for the benefit of everyone. We also invited colleagues to complete an anonymous survey to gather their views on our current benefits offering, to understand which benefits were the most important to them and learn more about what they would like to see in the future. We listened to their feedback and acted, launching a new Benefits platform which brings all our benefits together in one place. In support of our Values, we created a taskforce of colleagues across the Group whose role is to support with sharing the information in Group communications and initiatives - cascading them down to a local level, so no one misses out.
Sustainability

We are committed to being a responsible business and to embed sustainability into our culture. Over 2022 we started to formulate our pathway to Net Zero carbon emissions. From 2023 we have committed to being a carbon neutral business, offsetting our emissions using a blend of REDD+ overseas projects that will directly benefit the environment and provide social benefit to poorer communities. I'm passionate about creating a Net Zero Heroes taskforce to help us in our quest to reduce our carbon emissions and reach our Net Zero targets. You can find out more about our approach to sustainability on the dedicated area of our website www.markerstudygroup.com/sustainability/ sustainability where you can also find our 2022 Sustainability Report.
Charity Partnerships

We're committed to volunteering and supporting charities and good causes in our local communities and further afield. We hold an annual Markerstudy fundraising day, choosing the Ukraine Humanitarian Appeal as the recipient of all monies raised in 2022. We also have two charity partners that we regularly support, Auditory Verbal UK: a charity offering hearing-impaired children and babies a unique rehabilitation programme and Future First: a charity whose mission is to strive towards a world where a young person's start in life does not limit their future.
Results

You will read more about the detailed results of Markerstudy in the rest of this report and Financial statements, I am happy with the way the underlying business performed over 2022 in the face of some significant external challenges showing improvement in EBITDA reflecting the strategic acquisitions made and improvement in volumes and margins, and I am confident that we will continue to see strong earnings over 2023 and into the future. Kevin Spencer JP CEO
STRATEGIC REPORT DIRECTORS' REPORT FINANCIAL STATEMENTS
Company Background

Markerstudy Group Holdings Limited ("the Company") was incorporated on 9 December 2020 as a vehicle for a capital injection into the group of companies previously owned by Markerstudy Holdings Limited ("the Markerstudy Group"). On 14 July 2021, the proceeds of this capital injection, facilitated by the issuance of shares in the Company, were used to purchase 100% of the shares in a newly incorporated holding company Markerstudy Group Limited ("MGL"). MGL used the proceeds of this share issuance to acquire the Markerstudy Group. The comparative period in the financial statements therefore covers the period 9 December 2020 to 31 December 2021 but only includes the results of the Markerstudy Group from its date of acquisition of 14 July 2021 through to 31 December 2021. The current period figures show the results of these entities for the full year to 31 December 2022.
Markerstudy Broking

The Markerstudy Broking business' saw growth across a number of products year-on-year. The most significant of these was in Pet Insurance, where a combination of market demand and our competitiveness led to an increase of sales through our direct business channels. Our specialist motor, commercial and home lines all continued to maintain or grow policy volumes and, whilst renewal performance has been strong, in order to generate future revenue growth, we have invested in new business acquisition, accepting increased marketing costs. Rising costs from suppliers has diluted gross margin but means we have maintained a greater customer base to carry forward to future years.

Administrative expenses have decreased yearon-year despite the portfolio growth as we make the operations more efficient. Key to this has been relocating premises to consolidate the teams and bringing together product lines to support a leaner business. With rising overhead costs in general, management have looked to reduce cost by streamlining IT processes, fees and charges. Staffing levels have increased to meet the extra pet insurance volumes but economies of scale have meant that this has become more efficient to run on a cost per policy basis. We will continue to build on 2022's performance and continue growth throughout 2023. The lower cost base and increased focus on differentiated product areas within the business mean that we have clear sight of the profitable areas of the business to focus on. We have also tasked our colleagues with continuing to improve processes and platforms in order to attract new business and ensure that customers and partners benefit from both improved customer journeys and attractive products.
Clegg Gifford Acquisition

On 24 December 2021 the Group announced an agreement to purchase Clegg Gifford Holdings Limited and its insurance broker subsidiary Clegg Gifford & Co Limited ("Clegg Gifford"). Formed in 1968 as a general insurance broker, Clegg Gifford later evolved into a Lloyd's broker and a specialist in the UK motor trade market segment. Delays in regulatory approval due to the need to clarify the structure of the sale meant that the deal did not complete until 20 July 2023. However, the Markerstudy Group have commenced the process of integrating this business into the Broking division and leveraging the relationship with Tradex to create extra capacity for the MGA business. In addition, two new Guernsey entities have been incorporated to replace the Guernsey branch of the UK entity, one as an MGA for Channel Islands wholesale business and the other, a pure broker for retail.
MGA

MISL was able to leverage its Markerstudy Hosted Rate (MHR) pricing capabilities to improve underwriting footprint and get ahead of the wider insurance market in our response to fluctuating premium rates. The MHR product enabled speed and efficient delivery. Furthermore, MISL has been able to optimise non-risk incomes through its large network and bespoke schemes. MISL also commenced a number of material transformation projects in 2022, specifically in the claims and fraud spaces, that are starting to achieve traction. The MGA continues to manage West Bay Insurance Plc (formally Zenith Insurance Plc) premiums and claims as its primary insurance carrier, noting that it also manages additional capacity provided by Accredited Europe and Aviva. MISL's primary focus remains providing competitive products to new and existing customers. MISL also offers a range of additional services to insurers, specifically run-off claims and administrative services that it has been very successful delivering; specifically a UK Motor and Commercial Liability book of business on behalf of Lloyd's Syndicate 1274 and a Motor and Home book on behalf of Soteria Insurance Limited (formally Co-Operative Group Limited). 2023 looks to be a promising year for the MGA, with MHR gaining further traction, claims and fraud transformation projects delivering increased capabilities and efficiency savings and leveraging relationships with other Markerstudy Group businesses, most specifically the two newly acquired Distribution businesses, BGLi and Clegg Gifford.
Risk Governance And Framework

The Risk Function is central to supporting the business in their effective ownership of the risks, creating a positive risk culture that is owned within the business with clear accountabilities and risk ownership designed to ensure that we identify, manage, mitigate and report on all material risks and controls through the three lines of defence model:
1st Line Business functions that own and manage risks - these teams have primary ownership, responsibility and accountability for identifying, assessing and managing risks and controls.

2nd Line Risk and Compliance functions oversee compliance and management of risks, monitor, and help implement effective risk management practices and facilitate the reporting of risk related information. The Chief Risk Officer has accountability for the Risk and Compliance function with independence assured through direct access to the Chair of the Group Risk and Compliance Committee ("GRCC").

3rd Line Internal Audit function that provides independent assurance - improves Markerstudy's operations through independent objective assurance. The Head of Internal Audit has accountability for the IA function with independence assured through direct access to the Chair of the Audit Committee.

Our Risk Management framework defines a set of guidelines to identify, manage, mitigate and report risk across the business. The key processes that underpin this include: - Stress testing and scenario analysis; - Risk acceptance processes; - Risk appetite statements and process; - Materiality assessments; - Horizon scanning and emerging risk processes; - Policy framework; - Governance and accountability structures; - Assurance oversight; and - Compliance framework and regulatory monitoring.
Principal Risks And Uncertainties

We continuously assess the principal risks facing the business; these are defined as the risks that could result in us failing to meet our strategic objectives through our risk management processes. Over the past year we have seen a number of risks emerge or heighten along with others that have reduced within this timeframe.
Trading And Pricing:

Trading and Pricing risk represents the uncertainty in the profitability of the business due to volatility in the markets that the business operates. While the business model doesn't take direct insurance risk, the changes to the insurance market environment notably through the increased inflation, market rating and the continued challenges within the repair networks, has resulted in changes to customer behaviours. This has led to insurers changing appetite in terms of their risk acceptance, leading to both positive impacts on our business through greater switching and also challenges due to insurers reducing their footprint in some markets. Overall, this has been seen as an opportunity for the Group.
Market Risk:

Market Risk represents the uncertainty in the financial position due to fluctuations in the level and volatility of market prices of assets and liabilities. The Group is exposed to Market Risk through its financial assets and financial liabilities. These risks arise from interest bearing liabilities and equity products, which are exposed to interest rate and market price changes. The material increases to the interest rates has increased from historically low levels of 0.25% at the start of 2022 to 3.5% at the end of the year with continued increases post year end. Financial liabilities exposed to interest rate risk include debt funding facilities. Strategies to hedge the Group's exposure to interest rate rises are currently being investigated.
Change:

Change Risk represents the loss or adverse impact due to an inability to deliver change effectively, uncertainty in the outcome or impact on current business operations. During 2022 there was significant change to the Group with the acquisition of BGLi, which led to material structural changes to ensure an effective operating model was in place and synergy benefits across the enlarged Group were achieved.
Regulatory And Compliance:

Regulatory and Compliance Risk represents the risk of failing to deliver the appropriate treatment to, or meet the needs of, or expectation of our Regulatory bodies. There have been material changes within this with the FCA GIPP implementation at the start of 2022 and the Consumer Duty requirements coming into force from 31 July 2023. These both have led to significant projects to ensure compliance with the requirements as well as ensuring that the Board have effective oversight of these key regulatory requirements.
Liquidity Risk:

Liquidity Risk represents the risk that the Group will have insufficient cash resources to meet payment obligations without affecting the daily operations or the financial condition of the Group. As described in the going concern section above, the Group is expected to generate positive cash flows for a period of at least 12 months from the date of approval of these financial statements.
Credit Risk:

Credit risk refers to the Risk that a counterparty will default on its contractual obligations resulting in financial loss to the Group. The maximum exposure to credit risk at the reporting date is represented by the carrying amount of each asset on the statement of financial position, except for *loan secured by mortgage* within other investments as, at reporting date, the fair value of the collateral exceeds its carrying value.
Business Operations:

Business Operations Risk represents the loss or adverse impact due to failures with processes, people or systems - either within the Group or within suppliers/third parties. While there has been no material issues during the year there is an increase in this risk from a cyber perspective due to the Ukraine invasion, but also reductions on the people elements of this risk due to the settling down in the employment market and people becoming more use to the hybrid working environment.

# Corporate Governance

The Wates Corporate Governance Principles for Large Private Companies (the "Wates Principles") serves as the framework to demonstrate how directors have had regard for the matters set out in section 172(1)(a) to (f) of the *Companies Act* 2006 ("s172") when performing their duties, including how directors have engaged with and considered the interests of stakeholders including the Company's shareholder, employees, suppliers, customers; and other stakeholders such as the environment and local communities within which the Company operates. The Board of Directors of Markerstudy Group Holdings Limited ("the Board") believe that they have acted in a way that they consider, in good faith, with regard to the matters as detailed in s172 and the Wates Principles as follows.

Principle 1 Purpose and leadership The purpose of the Markerstudy Group Holdings Limited Board of Directors is to provide leadership of the Group within a framework of prudent and effective controls which enables risk to be assessed and managed. The Board sets the Group's strategic aims, ensures that the necessary financial and human resources are in place for the Group to meet its objectives, reviews management performance and has a clear oversight of the Group's operations. In addition, the Board sets the Group's values and standards and ensures that its obligations to its shareholders and others are understood and met.
Principle 2 Composition

The Board believes that its size and structure provides a balance of skills, backgrounds, experience and knowledge necessary to oversee the current scope and complexity of the Group's activities. During the period, the Board comprised of a Chair and four to five further Non-Executive Directors, the CEO, the Chief Financial Officer and the Chief Underwriting Officer. The Company has separate Chair and CEO roles to maintain a balance of responsibilities, accountability and effective decision-making. The Chair leads the Board and is responsible for its overall effectiveness, promoting and facilitating open and constructive debate. The Chair, supported by the Company Secretary, ensures that all Directors have sufficient time and information to facilitate meaningful discussion and that there are good levels of communication between the Executive Leadership Team and the Board.

The Company values the contribution brought by Non-Executive Directors, particularly their contributions to the formulation of strategy, independent and objective judgement to Board deliberations and constructive challenge of Executive Management. The Board's terms of reference were updated in May 2022 to stipulate that there be ten full board meetings per calendar year.
Principle 3 Responsibilities

The Board is guided by its terms of reference, which provide a framework for governance practices and clearly set out the Board´s overall leadership responsibility and matters reserved for its consideration and approval, whilst delegating to the CEO and Executive Leadership Team the day-to-day running of the operations of the Group. As corporate governance and business practices evolve over time, the Board will review its terms of reference and other governance policies and update them as necessary.
Principle 4 Opportunity And Risk

The Board promotes the long-term success of the Company by identifying opportunities to create and preserve value, while maintaining oversight of risk. The CEO provides an update at each meeting, detailing performance, five-year forecasts, key business initiatives and future plans for value creation. The Board has responsibility for the Group's overall approach to risk management and has delegated this oversight responsibility to the GRCC. The GRCC receives regular reports from the Chief Risk Officer on risk-taking relative to performance and makes recommendations on risk appetite and tolerance to the Board annually. The Group's principal risks are outlined above.
Principle 5 Remuneration

The Remuneration Committee ("RemCo") assists the Group Board in meeting its responsibilities regarding the determination, implementation and oversight of senior remuneration arrangements to enable the recruitment, motivation and retention of such senior employees who have the required skills to support the strategic objectives and values of the Company. RemCo is responsible for determining and implementing the Group's Remuneration Policy for the Directors, Company Secretary and other senior Executives, ensuring that overall levels of reward or remuneration are sufficient to attract, retain and motivate individuals of the quality necessary to manage the business effectively and successfully, but that overall levels are not excessive in comparison to the relevant external market and incentive arrangements do not encourage excessive risk taking. RemCo is responsible for ensuring that the Remuneration Policy does not incentivise behaviours that will or could cause harm to customers.

Principle 6 Stakeholder Relationships and Engagement
Customers And Suppliers

Across the Group, we have many long-standing and highly successful relationships with our customers and suppliers. The Group's ethos is to promote fairness and integrity in customer service and commit to 'putting the fun into insurance', for the benefit of our customers, employees and the communities in which we operate. Our customers are at the heart of everything we do, and the Board is committed to treating customers fairly. The Group is also committed to building strong, positive relationships with a wide range of insurers, brokers, managing general agents and other distribution channels.