The industry speaks out

DUNCAN BOYLE, CHIEF EXECUTIVE, ROYAL & SUNALLIANCE UK

What in your view are the most important challenges the CII faces in the year ahead?

It should be at the forefront of current issues, for example the need for training on contract certainty obligations.

How do you rate the government on insurance issues? Does the government listen enough?

Barring election time, when it was distracted, yes. It has taken action on pensions, liability reform, rehabilitation, climate change and uninsured driving. This is rightly the case, given that the general UK insurance industry, as an economic sector, has an annual output of around £18bn, and generates added value of £13bn.

What do you think of the regulatory environment? Does it help or hinder business? What would you like to see the FSA do to help insurance?

A bit of both! Strong regulation should help to improve the industry standard. At times though it is too prescriptive and ends up being a pain for firms and customers. I want to see the FSA cut regulation that serves no useful purpose for customers and adds unnecessary cost.

How do you consider the current market conditions? Are they better or worse than last year?

They are much the same. We've seen through rate changes that some markets are still softening. But the industry has now realised that it has to write at a profit and not rely on investment income, so disciplined underwriting should make the cycle shallower than those of the past.

Are there enough young people joining the industry? How can more young people be attracted to the industry?

We are in a war for talent with other industries and insurance is not sexy when viewed from outside. We must promote the variety and interest offered by the industry.

What advice would you give to young people coming into the industry for the first time?

Take a look at the varied career paths available and match your skills and abilities to the best route for you.

What has been the biggest lesson you have learnt in your professional career?

Don't believe your own publicity - always drive hard for success even when things appear to be going well.

STEVE CARROLL, MANAGING DIRECTOR, MARKEL UK

What in your view are the most important challenges the CII faces in the year ahead?

To connect more with 'its public' and become more fashionable - particularly to younger members.

How do you rate the government on insurance issues? Does the government listen enough?

Insurance is a big earner and employer and so, like a lot of other things, it is only when things seem to go wrong that governments tend to 'listen'- or am I just being cynical?

What do you think of the regulatory environment? Does it help or hinder business? What would you like to see the FSA do to help insurance?

I wasn't a fan of self-regulation as I don't think it sends the right message, but external regulation must be undertaken by balanced and relevantly experienced people who understand the industry.

What do you think of the current market conditions? Are they better or worse than last year?

There's no point worrying because you can't control them. According to recent insurer press coverage, all their underwriters are acting in a disciplined way so I predict a hard market for at least another 25 years!

Are there enough young people joining the industry? How can more young people be attracted to the industry?

Yes, but we must manage their expectations and put the right people in the right roles. If we get good young people in, are there enough 'good old ones' to teach them properly?

What advice would you give to young people coming into the industry for the first time?

Try to meet your immediate boss at interview as he or she could have a big influence on your fledgling career.

What has been the biggest lesson you have learnt in your professional career?

Stay focused and remember business is generally a team game.

DAVID WILLIAMS, BOARD MEMBER, CII FACULTY OF CLAIMS AND CLAIMS DIRECTOR, AXA

What in your view are the most important challenges the CII faces in the year ahead?

That it is seen to provide the skills and qualifications needed in light of the recent regulatory changes. Also to make the new faculties work well.

How do you rate the government on insurance issues? Does the government listen enough?

It is much better on regulatory issues and has worked well with the industry on compensation and flooding.

What do you think of the regulatory environment? Does it help or hinder business? What would you like to see the FSA do to help insurance?

It won't hinder business, though red tape in some areas for small firms is excessive. Some regulations are being taken too far and misinterpreted by firms due to lack of clarity.

What do you think of the current market conditions? Are they better or worse than last year?

The market is bordering on being too soft. There have been big rate reductions and profitability is a worry. It is definitely worse than last year.

Are there enough young people joining the industry? How can more young people be attracted to the industry?

No. We need to show young people they can progress and have interesting roles. Awards are an excellent way of showing that they can make their mark and help dispel our grey image. We particularly need to encourage talented young women.

What advice would you give to young people coming into the industry for the first time?

Do your insurance exams early in your career, and recognise that you can build a career in insurance rather than use it as a stopgap.

What has been the biggest lesson you have learnt in your professional career?

Once I recognised that I was dealing with something that impacts upon the customer in a time of crisis, I gained more from my career.

IAN STUART, CHIEF EXECUTIVE, ZURICH FINANCIAL

What in your view are the most important challenges the CII faces in the year ahead?

It will be around continuing to keep pace with bedding down the FSA regime, particularly on training and competence requirements and making sure CII qualifications remain up-to-date and relevant.

How do you rate the government on insurance issues? Does the government listen enough?

There are so many insurance issues that come up on the government's radar.

However, the industry, through the ABI and directly, has a regular dialogue with the government which allows for an adult discussion of the issues.

What do you think of the regulatory environment? Does it help or hinder business? What would you like to see the FSA do to help insurance?

In the lead-up to 14 January 2005, the industry had to move quickly to anticipate the changes. During this time, we built up a helpful dialogue with the FSA. We expect that will continue. We also hope that any future regulatory initiatives are mindful that the industry needs a period of reflection while the regime beds down

What do you think of the current market conditions? Are they better or worse than last year?

Market conditions have definitely become more challenging and it's vital that we continue to focus on the fundamentals of insurance. To that end we have developed The Zurich Way which enables us to drive business by rigorous focus on operational excellence and by applying common methodologies.

Are there enough young people joining the industry?

There are never enough talented young people joining the industry - we always need more talent at all levels. The biggest hurdle is the perception of the insurance industry. The good news is that perceptions are changing.

How can younger people be attracted to the industry?

Overall, selling the opportunity to make a difference to an organisation and be recognised for their contribution is key. The most important motivators for young people are meaningful and challenging job roles, where the people they meet/work with engage them, together with the opportunity to add value to the company.

What advice would you give to young people coming into the industry for the first time?

Utilise every opportunity to meet new people within the business, and learn about other parts of the organisation and how it works. Never be afraid to ask questions and challenge the existing process with suggestions of new ways of working.

What has been the biggest lesson you have learnt in your professional career?

Implementing change has been one area where I have had lots of experience and learnt many lessons. In a change process, when you've done the research, there's always a period of reflection, discussion, debate and then implementation, but in retrospect one can often say 'could I have done this faster?'.

PIERRE LEFEVRE, CHAIRMAN AND CHIEF EXECUTIVE, GROUPAMA

What in your view are the most important challenges the CII faces in the year ahead?

The CII has made some excellent progress under the leadership of Sandy Scott. Clearly there is now an increased need to continue to drive up technical standards, to ensure greater proficiency and to enhance competencies.

As substantial new markets begin to emerge and open up in Asia and elsewhere, the CII can support the work necessary on technical standards and bring to bear its almost unrivalled experience and expertise. This offers a real chance to help develop a truly global culture.

How do you rate the government on insurance issues? Does the government listen enough?

We have seen reasonable progress and the industry is now involved in some valuable dialogue with the government. We have taken some important steps on matters such as uninsured driving and flooding and also in beginning to get to grips with social issues including fraud and the compensation culture. My overall impression is that the government now possesses a far greater understanding of some of the detail and thinking behind it and is beginning to listen more to the views of our industry.

What do you think of the regulatory environment? Does it help or hinder business? What would you like to see the FSA do to help insurance?

The new regulatory environment is suffering from a somewhat muddled approach.

It seems to want to please everyone and yet is in danger of doing the exact opposite. On the one hand the regulatory regime is claimed to be principles-based and to rest accountability on senior management. On the other hand, it seems to be in 'micro management mode' although without a real understanding of management or the practicalities of the issues.

It is extremely important that we retain the ability to manage our own businesses while allowing the FSA the weaponry necessary to make it an effective regulator.

What do you think of the current market conditions? Are they better or worse than last year?

The market is enjoying its fourth year of very positive results and if this is to continue it is important that we retain our discipline. Where real pressures on rates occur, they are perhaps limited to areas that have been overpriced and where some correction might be appropriate. There are still some good opportunities to underwrite business at adequate pricing levels.

Are there enough young people joining the industry? How can more young people be attracted to the industry?

The whole issue of the 'grey men/ women of insurance' still prevails - even though accountants, lawyers and actuaries do not seem to experience similar recruitment difficulties. We are part of a very successful business that contributes massively to the fabric of society and to its financial security. Yet, it has traditionally been difficult to attract bright young people because of this poor perception.

What advice would you give to young people coming into the industry for the first time?

I would certainly advise them to broaden their knowledge of the industry to understand its various components. Too often young people are restricted to a single area. I would also encourage them to gain professional qualifications.

What has been the biggest lesson you have learnt in your professional career?

To be very open-minded about people, ideas and challenges, and always embrace change as an opportunity rather than regard it as a threat.

ANDREW TORRANCE, CHIEF EXECUTIVE, ALLIANZ CORNHILL

What in your view are the most important challenges the CII faces in the year ahead?

The industry itself faces an ongoing challenge to attract quality people from our universities. Persuading talented graduates that a career in insurance offers a stimulating, challenging and varied career is no easy task. The CII must be at the forefront of the industry's efforts to communicate this message. All those with an interest in the future of the industry should do all they can to support the CII in its efforts to market the industry to the next generation of business leaders.

How do you rate the government on insurance issues? Does the government listen enough?

We have been more successful in getting our message across over the past 18 months or so, and the government has listened and acted. Concrete examples of success include successfully persuading the government to invest more in flood protection. The industry has also worked well with government on the issue of uninsured drivers, although more still needs to be done.

The proposed Compensation Bill will be a further test of the industry's powers of persuasion and the government's powers of hearing.

What do you think of the regulatory environment? Does it help or hinder business? What would you like to see the FSA do to help insurance?

The imposition of the regulatory regime has driven improvement in our industry. Now the challenge is for the industry and the FSA to carry on a constructive dialogue, so that over-prescriptive rules are pared away, thereby reducing the bureaucratic costs of compliance. Reducing this cost will then allow more competitive products.

What do you think of the current market conditions? Are they better or worse than last year?

The market is showing pleasing signs of avoiding the boom-bust mentality of the past. Success in doing this is crucial if the industry is to retain credibility with its customers, who cannot understand the large swings in prices which they have historically seen. Success is also crucial if shareholders are to continue to make capital available.

Are there enough young people joining the industry? How can more young people be attracted to the industry?

More young people are joining our industry, but we still suffer from an image problem as far as the young are concerned. Everyone in the industry can adopt the role of ambassador and talk positively about their industry.

We have a lot to be proud of! Modern society could not function without our industry and not enough people know that.

What advice would you give to young people coming into the industry for the first time?

Be mobile, get professionally qualified and join a company that has a proven track record of training and developing its people. Like ours has.

What has been the biggest lesson you have learnt in your professional career?

Resilience, optimism, ambition and a strong work ethic will all increase the number of opportunities you are given.

ANNETTE COURT, CHIEF EXECUTIVE, RBS INSURANCE

What in your view are the most important challenges the CII faces in the year ahead?

Two of the most important challenges are for the CII to increase and maintain its profile across the industry and to help support the professional and personal development of people working within insurance at all levels.

How do you rate the government on insurance issues? Does the government listen enough?

The government has always been extremely receptive to what we have had to say both directly and indirectly, via the ABI, on key issues. This is shown by government support over uninsured driving and flooding. We need to keep up this dialogue.

What do you think of the regulatory environment? Does it help or hinder business? What would you like to see the FSA do to help insurance?

A sound regulatory environment is crucial within any commercial setting and it is particularly important for the protection it brings to consumers.

What do you think of the current market conditions? Are they better or worse than last year?

There are indications that the market is beginning to behave more sensibly than previously, especially in light of the prevailing market conditions.

For the fourth year running, motor claims inflation has continued to outstrip premium inflation and this clearly is not a sustainable position.

Are there enough young people joining the industry? How can more young people be attracted to the industry?

There are not enough young people joining the industry, and not enough young people in insurance. First, we need to dispel any ideas that insurance is boring. We also need to ensure that school leavers and university graduates are well informed about the variety of career opportunities.

What advice would you give to young people coming into the industry for the first time?

It's a fast moving business that benefits from a flexible approach. If you undertake a broad range of CII exams, you'll not only have a blend of both practical and proven experience, but potentially a highly satisfying career.

What has been the biggest lesson you have learnt in your professional career?

Everyone is capable of achieving far more than you ever imagine, including yourself. Also it's important to have a healthy balance of hard work and fun.

ERIC GALBRAITH, CHIEF EXECUTIVE, BIBA

What in your view are the most important challenges the CII faces in the year ahead?

To ensure that its programme is geared to, and relevant to, each segment of the industry. The Broker Faculty and the other faculties should all be useful vehicles to ensure this is achieved. The potential is huge and benefits not only the CII but Biba, the ABI and other stakeholders.

How do you rate the government on insurance issues? Does the government listen enough?

It is not up to the government - it's the industry that has to get its act together and demonstrate the advantages of London and the UK as world leaders.

What do you think of the regulatory environment? Does it help or hinder business? What would you like to see the FSA do to help insurance?

General insurance brokers and intermediaries are still adjusting to the new environment. I know that many are working hard to ensure that they are fully compliant. And while we are confident that Biba members are responding to the new regulatory environment, some technical issues may take a little more time to iron out. There are some issues that need to be addressed, such as the overall cost, the amount of documentation and some very complicated rules around client money.

What do you think of the current market conditions? Are they better or worse than last year?

The market is soft and while competition is a good thing we need a strong market, not one that has peaks and troughs that in any other industry would be an embarrassment.

Are there enough young people joining the industry? How can more young people be attracted to the industry?

For many years new entrants to the industry have fallen into it by accident, not by choice. While we need to balance supply and demand, we need to promote the industry better to school leavers and graduates and get closer to potential contacts at an early stage.

This is not just a CII issue, it is an industry issue.

What advice would you give to young people coming into the industry for the first time?

Get as much experience as possible and get qualified - go for ACII and FCII. The industry can offer a huge range of opportunities once you are inside it.

What has been the biggest lesson you have learnt in your professional career?

I'm still learning, but once you have your own train set there is no better experience.

STEVE WILLIAMS, MANAGING DIRECTOR, CARDIFF PINNACLE

What in your view are the most important challenges the CII faces in the year ahead?

The very same as every other organisation - convincing its customers it will add value and benefit to their lives and businesses.

How do you rate the government on insurance issues? Does the government listen enough?

There are still no signs of a joined-up government. The housing market is the pulse of the UK economy and will be in the front of the mind for the Treasury and No.10. It could do more to raise its understanding of insurance issues. The constant reshuffles also work against continuity.

Rarely does a minister stay in place long enough to see anything through.

What do you think of the regulatory environment? Does it help or hinder business? What would you like to see the FSA do to help insurance?

It's all still a bit new for general insurance. Its sheer size and scale has caused problems, but as it evolves it will ultimately benefit our industry. Both the FSA and the industry must do much more to educate consumers on insurance and financial services. This in itself would hopefully lead to a scaling down of the rules and bureaucracy. There is nothing to be gained by stamping out mis-selling and replacing it with a larger mis-buying problem.

What do you think of the current market conditions? Are they better or worse than last year?

Consumer lending has slowed considerably in the second half of 2004 and the first half of 2005, which naturally affects our volumes. But, dare I say, there are some green shoots appearing.

Are there enough young people joining the industry? How can more young people be attracted to the industry?

No, definitely not. The industry's poor image has turned off a lot of youngsters. We need to turn that around and of course offer attractive and competitive salaries to new entrants.

What advice would you give to young people coming into the industry for the first time?

Look, listen, and learn as much as you can by asking questions and challenging the status quo.

What has been the biggest lesson you have learnt in your professional career?

That there is no place for complacency in business - for smug read mug.

DAVID SLADE, CHAIRMAN, CII FACULTY OF BROKING AND CHIEF EXECUTIVE, PERKINS SLADE

What in your view are the most important challenges the CII faces in the year ahead?

I think it is making the CII relevant to the different areas of the industry.

It needs to ensure it is not seen just as an insurance institute but as an industry wide institute.

It has made massive strides with the formation of the various faculties which are addressing the individual needs of the market. It is a real chance to make a difference to those who see themselves are part of an individual strand of the market in terms of giving them their access to the examinations and training they need to continue to develop in the chosen profession.

The second challenge is how we encourage and further promote CPD.

How do you rate the government on Insurance issues? Does the government listen enough?

The government is not terribly bothered with insurance. We have a government which is interested in vote winning and insurance is not seen as a vote winner. Therefore it does not listen and it does not understand what we do. It views us like the banking sector as a necessary evil. It has complied with the EU on regulation and it feels that it has done enough. It has not listened in terms of the industry's efforts on flooding, uninsured drivers and environmental matters. It may say it listens to us but it does not hear.

What do you think of the regulatory environment? Does it help of hinder business? What would you like to see the FSA do to help insurance?

In terms of the regulatory environment it is too soon to have any real opinion. Both the market and the regulators are on a very steep learning curve.There seems to be a huge amount of unnecessary bureaucracy in the regulation for example with regards to contract information.

The testing of participants is more about forms and box ticking than experience and advice to the customer.Those who committed in a big way to the regulation are now fighting more bureaucracy than practical implementation. I would like the FSA to get a greater understanding of how insurance works.

The vast majority of those who work in the industry are honest, respectable and doing everything they can for their clients. They should not treat everyone as if they believe they are simply trying to rip people off.

What do you think of the current market conditions? Are they better or worse than last year?

The market is the market and it is what it is. People talk about conditions but for those in the market their job is to make the best use of it. It's a bit like the stockbrokers. Be it a bull or a bear market they have to adapt themselves to the conditions and continue to trade. It is the same for the broker market.

Are there enough young people joining the industry? How can more young people be attracted to the industry?

There are not enough young people coming into the market but the issue is that they do not know what we are doing. It is a still viewed as a single industry and whilst that remains the perception, perception so often can become reality.

There needs to be greater promotion of the differences within the industry.

Do young people understand the breadth of career opportunities with insurance companies from underwriting to claims, risk advice and general management?

Do we tell them what a broker does and how wide and challenging their role is or the range of opportunities in reinsurance, insurance, international business, regional broking. The range of choice is immense. We don't promote it enough.

What advice would you give to young people joining the industry? How can more young people be attracted to the industry?

I would tell a young person to leap into insurance with real enthusiasm.

They should not worry about making mistakes. It a great and exciting industry in which you can enjoy an immensely challenging and financially rewarding career.We need young people as there are quite a few of us who could easily be consigned to the insurance retirement home and my advice would be to seize the opportunities that the industry offers.

What has been the biggest lesson you have learnt in your professional career?

Quite simply it is never stop learning both in terms of the skills used at work and the technical training. I still learn something new every day and will continue to do so. It is partly what makes the job so exciting.

CHRIS HILL, MANAGING DIRECTOR, HIGHWAY INSURANCE

What in your view are the most important challenges the CII faces in the year ahead?

The FSA presents the biggest current challenge for the CII, which has to demonstrate that its training and competency programmes meet the need of the industry and the regulator.

How do you rate the government on insurance issues? Does the government listen enough?

I am encouraged by greater government involvement in industry issues.

But whether the additional regulation is in the best interests of the industry and the public is another issue. I welcome the motor insurance database. It is a step towards eradicating uninsured driving.

What do you think of the regulatory environment? Does it help or hinder business? What would you like to see the FSA do to help insurance?

Regulation is inequitable insofar as loopholes such as Gibraltar exist.

On the positive side, raising professional standards will ensure that competent people sell insurance. But the added cost, administration and extra reporting requirements can be too smothering and protective.

What do you think of the current market conditions? Are they better or worse than last year?

The market conditions are very soft, indeed worse than last year. As a result, competition is becoming fiercer, meaning premiums will not go up as quickly as necessary to cover factors such as rising personal injury claims costs. But as long as we remain disciplined in underwriting I am confident the year ahead will be more settled.

Are there enough young people joining the industry? How can more young people be attracted to the industry?

There are plenty of young people joining the industry. The problem is keeping them. Insurance is often not seen as a real profession, like say accountancy or law, however what people fail to recognise is that people within the insurance industry have to work just as hard to get qualified.

What advice would you give to young people coming into the industry for the first time?

Get your professional qualifications, and don't narrow down your options too early. Insurance offers a wide variety of opportunities from underwriting to IT and claims to HR, and the best one for you may not be immediately apparent.

What has been the biggest lesson you have learnt in your professional career?

Don't be afraid to take on a challenge if someone is prepared to offer it to you.