The industry has learnt that you don’t mess with Andy Homer, one of the men who has made Towergate the insurance powerhouse it is today. Ellen Bennett meets the personality behind the headlines.

A loveable rogue? An aggressive, arrogant entrepreneur who’s stuck two fingers up at the insurance market and made millions in the process? Or a corporate careerist with a carefully planned long-term strategy and a ruthless approach to business? Andy Homer, Towergate’s larger-than-life chief executive, has been described in all these ways – and more.

Today, he’s relaxed and smiling in Towergate’s glossy boardroom, seated at one end of its large, shiny, oval table, sipping Tony Blair-style from a mug of tea. Within the past few weeks, Towergate has defied the economic downturn to announce record results in the first quarter of this year, as well as finally sorting out its bothersome banking covenants. With all this under his belt, Homer seems inclined to be charming and, in his most frank interview yet, ready to answer the question: who is the real Andy Homer?

A lot of people might think they already know the answer. Indeed, he laments, most of the insurance market has a preconceived opinion of him and Peter Cullum, Towergate’s chairman and Homer’s long-term friend and business partner. “One guy famously said to me: ‘Andy, I didn’t like you ‘til I met you’,” he quips, leaning forward to put his point across. “I think Peter and I run the risk that people think that they know us, they think that they’ve met us.”

That’s hardly surprising because they’re probably the closest the insurance industry gets to celebrities. Since Cullum founded the business, drafting in Homer from his job as chief executive of AXA in the summer of 2001, Towergate has redefined the broking landscape. It has acquired 156 businesses and used their combined weight to push its commissions to unheard-of levels.

It has also used the insurance know-how of its senior team – all recruited from insurers rather than brokers – to take on many traditional underwriting functions, expanding the role and might of the intermediary, triggering a spate of imitators and causing first admiration and then ire among insurers.

Homer acknowledges that Towergate’s rapid rise and tough negotiating stance have not won it many friends, but insists that the perception of Towergate – and him – as arrogant, brash and determined to win at all costs is wrong.

“Peter and I are pretty private people. We’re very much family oriented; we’re about kith and kin. My family and the people I work with are the closest people to me, so you expose your vulnerability and your hopes and your fears to a very tight group. But if you’re outside that group you probably don’t see it,” he says.

Homer has friends as well as enemies. Stuart Reid, the chief executive of Bluefin, is among them. He says: “I know of no one who is better connected than Andy, no one who is as hard wired into the market, and no one who has quite got that mischievous glint in his eye that marks him out from the crowd.”

Yet, however accommodating he’s being today, Homer – smiling broadly underneath his messy hair and looking much younger than his 56 years – confesses that “every psychometric test I’ve had since I was 25 has said I’m arrogant”. He doesn’t mean to be that way, he says, and has to apologise for it sometimes.

So is there anything he would have done differently? “We made a few acquisitions where we didn’t spend enough time giving TLC to the account execs we brought across, explaining what a crucial role they had,” he confesses. “In 2007, we lost about 15 execs, which we had never done before.”

But the great thing about working for an entrepreneurial business as opposed to a PLC, says Homer, is the freedom to identify and fix mistakes quickly. So Towergate overhauled its reward and remuneration structure and slowed the flood of departures.

The contrast between the freedom of an independently owned business and the stuffiness of a PLC is a theme that Homer, who spent the first decades of his career working his way through the ranks of insurers, clearly adores.

He’s outspoken, and it’s hard now to imagine him gagged by stock market rules and twitchy press officers. Indeed, he delights in playing up to Towergate’s carefully nurtured image of a straight-talking, no-nonsense outfit, where the juniors aren’t afraid to laugh at the bosses and anyone who gets too pompous in the boardroom is rapidly “shredded to pieces”.

But this must be set against the company’s formidable reputation for negotiating. He acknowledges: “We are very intense about business. If I went around too relaxed and joking, people would get completely the wrong idea.”

Towergate has never been known to back away from a row, and there have been some tricky moments with insurers. It’s no secret that several of the big players that had originally encouraged the consolidator model turned against it last year, seeking to push down their distribution costs and getting tough on negotiations – inside and outside the boardroom.

Homer reckons he understands why – “There is no question the cost of distribution is too high” – but he laments the public nature of some of the rows. “It would have been better for some of those conversations to have been in private. That’s not to be critical of anyone, but to read headlines all the time saying that consolidators are going to have their commissions cut doesn’t really help the atmosphere when you go into negotiations.”

Then there’s that reputation for pushing insurers into a corner, forcing their hand, threatening to walk away with huge chunks of business if they don’t get their terms. Had they simply pushed the insurers too far?

“That’s an interesting question,” muses Homer, a picture of candour and reason. He repeats that the cost of distribution is too high, but is quick to refer to the many functions Towergate has taken on on behalf of insurers, and the fact that 50% of its business comes from other brokers, who receive the bulk of the commission. “The headline figure can look quite high, but a lot of the work is being done internally,” he says.

Recently, there have been some tough talks with the banks too. Towergate has just renegotiated its banking covenants, a lengthy process that began last year and something that was, says Homer, severely delayed by banking problems and personnel changes.

The delay prompted a lot of chatter among Towergate-watchers, many of whom were quick to speculate that the consolidator’s highly leveraged business model was coming unstuck.

Homer can’t resist a dig at the naysayers who, he says, are one unfortunate consequence of Towergate’s controversial reputation. He is confident the consolidator model will survive. He praises several fellow consolidators – Oval and Jelf among them – and predicts that as prices come down to a more realistic level, brokers will continue to buy their peers, albeit at a slower rate than in the heady days of 2007.

Moreover, he predicts that within the next 18 months, insurers could finance a number of these deals as they look for better investment returns than the shattered markets can offer.

As ever, Towergate will be at the front of the pack. “We are very, very interested in making more acquisitions that fit our existing model,” he says, but adds that a transformational deal such as the acquisition of Broker Network or Open GI, both in 2007, is not now on the cards.

Meanwhile, would it sell any of its businesses? “It depends on the valuations,” he shrugs. “I don’t see any MBOs in Towergate, but I can see it in other organisations. History shows that as organisations grow, they separate and change in shape. If Towergate had a knock-out offer for one of its businesses, we would seriously consider it.”

Deals aside, Homer is focused on organic growth over the coming two years – through a move into providing technology to brokers looking to play on aggregator sites, for example, and systems to help its brokers to sell new products to existing customers.

He will also be looking to steer the business through a tough time economically, which will involve making some painful decisions. Homer says all his retail managers are being asked to produce three-month forecasts – “You never would have done this in the past” – and to cut costs accordingly.

Up to 10% of the business’s 3,500 staff could be shed over the next two years, he says, adding that there has been a salary freeze, its annual executives’ shindig in Portugal has been shifted to the more prosaic location of Maidstone, and the executive team has agreed not to take any bonuses for the second year running. “The economy is a really, really serious threat and will put businesses under stress,” he says.

This has personal implications, too. Homer and Cullum have gone on record as saying they plan to step back from the day-to-day running of the business within the next two to three years, handing over to the senior management team, including UK broking chief executive Amanda Blanc and underwriting chief executive Clive Nathan, and preparing for an IPO. That’s no longer on the cards. “This isn’t a great time for either Peter or me to leave the bridge,” he says. “We’ve got to stay around for a bit longer. It’s the wrong time to make any of those huge decisions.”

A fanatical West Brom supporter, Homer compares himself to Manchester United manager Alex Ferguson. “Each time he says he’s going to retire, no-one believes him.”

Joking aside, it’s hard to imagine him bowing out gracefully. Although he says he’s a hippie at heart – “grown up at college in the 60s, had long hair and smoked things you shouldn’t” – and that he would love to lie around on a beach soaking up the sun, somehow you can’t see it.

Perhaps even more surprisingly, he reveals an ambition to teach: “I’ve got a strong desire to go to a business school and teach them the things that actually happen, rather than the bloody theories,” he says. Sir Alan, eat your heart out.

Joker, terror, teacher, hippie … There are many sides to Andy Homer. How you see him will probably depend on whether you’re a friend, a rival, an employee or a partner. And, perhaps more importantly, on how he wants you to.