John Jackson says people are the most important element of the insurance industry, not technology
The news of large-scale resignations from reinsurer Benfield has sent shock waves through the industry, but the poaching of high profile individuals and even whole teams in a particular class of business is hardly new.
There has been massive consolidation in the insurance market in recent years, and with increasing competition from abroad in places such as Bermuda and Gibraltar, the premium is on having in place the right people leading the best teams in particular lines of business.
What the Benfield situation shows is that insurance remains a people-driven business, however much obsession there is with the idea that technology is king - it isn't!
It is also a timely lesson for those who believe that the face-to-face slip-case world of the Lloyd's market is old-fashioned and should be quickly phased out. Clients still want to see their brokers, who in turn still want to talk direct with underwriters. That is how the insurance business works best.
It is not new-fangled technology that drives insurance, but well tried and tested values such as trust, experience, reliability and providing a good service. The 'tick box' mentality of underwriting and claims management run by call centres in another part of the globe is a short-term, not a long-term measure.
It was not without significance that last week's Insurance Times survey on insurer service showed some big names at the bottom, smaller insurers regarded more favourably, and Lloyd's syndicates beating the non-subscription market hands down. It was ever thus.
Gone are many of the old boutique insurers and broking firms that were a byword for expertise and good service. But what of the views of the clients - how do they feel about finding themselves dealing with a different firm? I doubt whether they give it a second thought.
Back in the 1980s, when commercial enterprises were folding by the minute, many individuals - accountants particularly spring to mind - set up on their own and took their clients with them. So with insurance, a familiar and friendly face is what clients need - a bespoke service from someone with a good track record.
Many of the bigger names of the insurance industry, whose firms have been taken over or folded in recent years, were quickly picked up by other companies. Some of the more entrepreneurial set out successfully on their own. Insurance is still an enterprise business.
Poaching is a part of commercial life - why go to the lengthy business of setting up an entire department and advertising for posts when you can take one "off the shelf" with all the expertise - and the clients - already on board?
Benfield is just the latest victim of this fad. Indeed, it is a tribute to the reinsurer that its expertise in facultative reinsurance and the value of the man at its head, Elliot Richardson, was so coveted by Aon, that they wanted his services. Who said individualism was dead in insurance?
