R&SA is going to sharpen up its sales focus but keep its eye firmly on the bottom line. Brendan McManus tells Michelle Hannen about his new commercial regime

Brendan McManus says his promotion to UK commercial director at Royal & SunAlliance (R&SA) heralds a sea change for the company. It has finished its "internal fix-up", he says, and is now turning its attention outwards to communicate more effectively with its customers and with brokers. As such, McManus says his primary role is to "reinvigorate the R&SA commercial brand". He says that as the second largest player in the commercial lines market, R&SA needs to make sure it "plays to its proper position"."Where we need to improve the most is the way we tell our story. Probably some of our competitors have a weaker story than us but have told it better," he says.But R&SA must also improve its sales skills and propositions. This, McManus says, will involve hiring new commercial sales staff, as well as having better trained and incentivised staff, to sell a lot harder. Presenting differentiated propositions to the market and communicating the areas it wants to concentrate on for growth more clearly are also key areas. "People will see much sharper propositions coming from R&SA, a lot sharper focus about the segments of business that we want to write in and those that we don't. We won't be embarrassed saying that we don't want to write business," McManus says.With the downsizing and exiting of business lines complete, the commercial book should be recording "small but steady growth" going forward, he says. In the current market conditions, the company is not prepared to "prostitute" itself to achieve double-digit growth."That would take about 18 months before it works through to the bottom line, and then we all get sacked again," he says

Specialist businessesTo get the most from the businesses it has, McManus wants to ensure that more cross-selling takes place in its specialist businesses such as ProFin, marine and engineering."We've been ineffective in cross-selling in the past, but that's an area that we'll see some considerable improvement in," he says.On current market conditions, McManus says the situation is more of a "short-term price correction", rather than a full-blown softening."The reality is, probably most insurers overcooked the price in the last couple of years, so there's a pricing correction going on. It's also assisted by the fact that there's new capital coming into the market. It's the theory of supply and demand, more capital means more supply, [and that] means prices come down a little bit."To retain profitability, R&SA's focus is firmly on the bottom line, rather than the top - unlike, he says, some of its competitors."You can have all the top line in the world, but if you don't make money at it, it's no good. And that's where a lot of our competitors are. They are growing strongly but they're growing on weaker rates at the moment, and that's generally the road to ruin. If you grow business in a softening market, it has an inevitable outcome."

Unsustainable marketsMcManus denies suggestions that it is brokers who are currently putting pressure on rates. He says that with the majority of brokers still commission-based they have an interest in seeing rates remain high. "I was quoted recently as saying it's not the brokers' fault that there is a softening market, they don't hold the pen, they don't underwrite the business. So at the end of the day if the market is available to them at that price then they will do that."However, he is concerned about the effect of brokers using unsustainable markets in order to chase revenue growth. "They will use markets that they know are not great markets and don't have sustainability to chase revenue growth. But they will use it as a short-term play," he says. "There will be another Independent Insurance at some point, and then all the brokers will moan about the contribution they're having to make to the policyholders' protection scheme. So eventually they get what's coming to them. But I don't blame the brokers for that, they're doing what they need to do for their business."But, unlike many industry pundits, McManus is pragmatic about the market cycle. He recognises that the same forces that contribute to the cyclical nature of insurance also make the market dynamic, by attracting new capital, encouraging product development and proposition innovation and promoting better quality service."The fact that the interests of insurers and brokers are rarely ever aligned is a positive."

McManus on his new role"What I bring is a lot more vigour and energy around my desire to grow the top line, as well as making sure we still have our market share of bottom line."And I bring a lot more desire to articulate what we do well and to make sure that that's part of the DNA that our people have when they speak to brokers. "And what I hope to bring is a lot more confidence about our capabilities, rather than being too humble about what our capabilities are."