Property and Casualty Services was the jewel in the Independent crown. Then the insurer collapsed. Elliot Lane revisits the days of corporate mayhem
If there was one thing Michael Bright and his colleagues at Independent Insurance actually got right, it was Property and Casualty Services (PCS). Everyone in the industry respected its loss adjusting division and knew that, of the whole Independent nexus, it was the most profitable and desirable business to cherry-pick.
One year on, the company is still thriving, but the scars from those last days have yet to heal. Commercial adjusting services manager Vic Noble remembers the fateful day.
"The whole thing caught us off guard. I went down into a PCS board meeting, on the Monday [18 June 2001] when it all happened, to be met by accountants from PricewaterhouseCoopers [PWC] saying: `We are sitting in on your board meeting.' So that was not the best start to the week."
At that moment it dawned on Noble and his colleagues the full extent of Independent's problems. Although it was well-known in the industry that PCS was the proverbial jewel in Indie's crown, Noble says its future at first glance seemed far from bright.
"With Independent going bust, we had lost our largest shareholder and our largest client and creditor overnight. So they (PWC) descended on us quickly and sent in a team to check the numbers and books in the Cheadle office. And then an advert went into the Financial Times saying: "`One good loss adjuster for sale'."
Things moved extremely quickly after that meeting. Managing director Barry Woodward tried to arrange a management buy-out (MBO).
"It was a hard week trying, but it soon became obvious that an MBO would not work. And PWC wanted a major financial institution to come in and buy it," says Noble.
But a buyer was already hovering ready to swoop.
"We didn't know what the reaction would be. Will anyone be interested in a company associated with Independent? But, surprisingly, a lot of interest was shown. And what was more surprising was the speed in which R&SA moved in to secure the deal," explains Noble.
R&SA made it clear from the outset that it wanted to run PCS as a going concern. Bob Fitzsimmons took charge in January 2002 and now the business is run as two separate entities - one side commercial and the other personal lines, Noble says.
"The staff view R&SA as the biggest white knight on the biggest white charger you have ever seen," adds Noble.
Then all the staff were told of R&SA's hot desking plans and that the majority of staff would become mobile. Noble claims that PCS was already heading down this route.
Claims managers at R&SA were using voice recognition dictation, which has now been integrated with PCS's own digital dictation and digital photo system. The two teams have "picked out the best from each area of the business" to form a more sophisticated company, says Noble.
Is in-house loss adjusting the way forward? And is PCS a good model?
"Naturally I'm biased but it must be."
So for Noble it is a case of no regrets.