NU boss Igal Mayer is defining his UK broker strategy.
Look beyond the headline job cuts and Norwich Union (NU) boss Igal Mayer is clearly defining his UK broker strategy. The group is at pains to point out that while some of its operational cuts are severe, front line trading in its key regions will remain, and is central to growth. Mayer has recognised that he has around 4,000 broker relationships and that they must take centre stage. It is all too easy for chief executives to get caught up in the big picture and five-year predictions when there is a war being waged on the ground. And Mayer has decided to fight that war head on. As one NU executive puts it: “Igal is talking a tough game now, he’s playing hard ball with the consolidators and this strategy puts NU up front and centre with all the independent brokers. And they need to know they can count on our support if and when they need it.”
What’s more, the restructuring promises improved service, a major gripe of many brokers, and efficiencies which in this economic climate are a necessity. NU’s outsourcing arrangements, which have been the subject of fierce scrutiny, will also come under further review. But along with its commitment to improve service, it is also likely that NU will make sure that all initial service operation calls will be answered onshore.
But Mayer’s strategy, at its heart, is a local one. Step back from it and it is easy to see that the Aviva group has a wider master plan. And the context is best articulated in a document produced by consultant KPMG this week that reports that: “Restructuring is no longer a clean-up exercise, performed once a decade. For insurers to maintain their performance and competitive edge, it should become an iterative process.” And in this market where the only constant is change, to see how NU’s UK strategy fits into its global plans remains key to understanding how the distribution strategies among other insurers may play out. What this means for NU’s existing deals with consolidators and larger brokers is hard to say and will probably be the subject of intense negotiation. But should you seek to understand the wider European regulatory environment, focusing on issues such as tax, it gives a unique insight into why NU is now setting its stall out again in the UK market.