Peter Halpin

There is no special connection between Battersea in south-west London and personal lines broker Swinton, it’s just home to one of its 580-odd high street branches throughout the UK. But it’s where Insurance Times catches up with Peter Halpin, little more than two months since he stepped up as chief executive to replace Patrick Smith, the man who took Swinton to new heights and now the company’s chairman.

In his first interview, Halpin lays out his plans, centring on a joint approach to distribution via high street branches and the internet – dubbed “clicks and bricks” – and the proposed expansion of Swinton Commercial. He admits the division did not get off to the best of starts four years ago but, as he details renewed ambitions to become a Top 10 commercial broker by 2012, he says it is now the jewel in the Swinton crown.

Its growth will be fuelled by the £50m acquisition of the Equity branch network from IAG at the end of 2008 – Smith’s swansong, you might say, and it’s the fastest growing division in a healthy business. In its 2008 year end results, Swinton posted a 4% growth in profits to £50.1m and a 15% rise in premium income to £763.9m.

Here in Battersea, the small gathering of staff seem a little on edge as they await the arrival of the boss from his Manchester base. Let’s face it, it is not every day the chief executive of a major UK high street business walks into one of his branches. But Halpin quickly removes his jacket and relaxes. Sitting in a stuffy staff kitchen, he apologises for the surroundings. “But this is who we are,” he says without hesitation.

Smith is well known and liked in the industry, and widely held to have achieved great things at Swinton. Halpin is keen to build on his legacy of eight consecutive years of profitable growth, though he admits the former chief executive will “undoubtedly be a hard act to follow”.

So what will change under the 46-year-old Halpin, who was previously deputy chief executive, prior to that finance director and before that just a director, and has been at Swinton for 19 years?

“Lots,” he says. “Swinton has always been a business that has gone through lots of change … that’s why it has been so successful. I think the change that we can expect over the next few years is likely to be more evolutionary than revolutionary – a continued development of our existing plans and business as it is today.”

One of his biggest tasks will be to balance Swinton’s high street legacy with the new online economy. The broker has established itself online, after a slow start, with Halpin guessing that it is now “probably one of the top five online providers.” It has launched a number of motor brands online and a home offering and recently launched a commercial vehicle site. Small SME sites are set to follow.

So how does this “clicks and bricks” approach actually work? Halpin admits most customers will never walk through a shop door as more flock online and predicts a continuing decline in the number of high street brokers – although he insists Swinton has no plans to reduce its number of branches. But he believes that combining the two distribution channels will provide great opportunities for cross-selling and customer retention.

“The opportunity for us over the next two to five years is to really build on the integration and development of the online world with our offline business,” he says. “A combination of the internet and our branch network will allow us to retain more customers that come to us through the online world. We will be able to look after and service them though the offline world and therefore build a stronger and deeper relationship.”

According to Swinton, 35% of new personal lines business comes online, as do 13% of commercial lines enquiries. But Halpin says that some people may find it surprising that Swinton is still seeing year on year growth in its offline new business, of between 5% and 10%.

Despite his commitment to online, he is passionate in his defence of the old-fashioned shop window. Indeed, the broker is now practically the only force left on the high street – a position he plans to exploit. “We believe we are unique,” he says. “No one else can offer the combination of online and national high-street presence.”

Another big challenge is growing the commercial book. The foundations have already been laid with the acquisition of the Equity branches, providing a ready-made £30m book of business. All 91 branches will be rebranded to Swinton, or in some areas to Colonnade, and on the Acturis platform by the end of summer.

Swinton is also moving back in to the Northern Ireland market – it left in the late 1990s – with a number of personal and commercial lines initiatives set to be launched in the Province.

The broker is well on track to hit its target of writing £150m of commercial business by 2012.

At the end of 2008, it was worth £75m. Halpin says the company should be writing in the region of £90m worth of business this year and hints at a number of acquisitions in the pipeline.

Despite some rumours about Swinton’s relationship with Aviva, Halpin insists they are on good terms. “They sit on our commercial panel and play an important part. They have not pulled any products. It’s the same as it’s always been.”

Meanwhile, the broker has not had to face the ire of the consolidators, finding itself more likely to compete against small local brokers.

That Equity deal was central to its growth plans – but it didn’t work out as planned. In fact, the broker bid for the whole IAG business, including Hastings, which it lost to IAG management, who used private investor backing for an MBO.

But Halpin remains adamant that Swinton got a good deal. “IAG had their reasons for selling it,” he says. “The management wanted to buy both branches and Hastings. We made an offer but the management team offered a higher price. We wish them the best of luck with it.”

What of the future? Despite the recession, Halpin says there is no talk of redundancies and cut backs. But he admits there will be challenges to profitable growth. “We will see pressure on margins as a result of more of our business being written online where they’re thinner. There will be a slowdown in bottom line profit growth. We will still see growth, good growth. But it won’t be at the rate it has been over the past few years.”

And its parent company, French insurer MMA? “They are very happy with the results and delivery and the growth plans we have.”

As Halpin finishes his tea and walks into the backyard to have his picture taken, he is every inch the “man of the people”. Keen to paint a picture of stability and continuity, he will have to admit, however, that the insurance market, the High Street, and those jittery staff in Battersea, will be watching closely. After all, he has big boots to fill.