It's seven months since Geoff Riddell took over from Patrick O'Sullivan as chief executive of Zurich's general insurance business. In his first interview, Riddell talks about liability, regulation and the joys of being boss

It's been a good week for golf fan Geoff Riddell. The Open Championship finished on Sunday and for the first time since he took over as chief executive of Zurich's UK general insurance business seven months ago, he has been able to get some golf in.

Friends of the ever-smiling Riddell, say that he was surprised by his sudden elevation, when previous boss Patrick O'Sullivan was promoted to Zurich's main board last November. Although Riddell is keen to play down personal issues and emotions in his first interview as chief executive, it is clear that although the seven months have entailed a whistle-stop tour of Zurich's UK offices and meetings with all of its key partners, he is enraptured with the job.

Clearly, liability remains an issue close to his heart, despite having to stand down as the chairman of the ABI's liability committee. He is concerned that the industry must keep its foot down on the accelerator, otherwise the government will get distracted by other issues.

"Liability issues aren't over by a long way yet. If you look at the OFT [Office of Fair Trading] report, it's short on immediate action and long on 'we need to look at things more'.

"They said they need a lot of convincing in the long term and if you look at the market dynamic, well the problem with that one is market failure doesn't happen gradually.

"There is time to put a convincing case. But the worry is that the drive to progress gets lost. They're not pushing for immediate action because the immediate crisis appears to be over. Does that mean that in fact they'll bury it?"

Riddell is a proponent of a long-tail disease pool. And this is precisely the area that the OFT seems least convinced that there is market failure. Riddell points to the US as a model of what could happen in the UK, where leading insurers are starting to agitate at a very high level about their continued presence in the market.

"There are some areas that it's getting tougher in. Some areas where there's long term exposure to chemicals and so on, we're having problems with. But there is absolutely no evidence of market failure at the moment."

The whole messy situation might have been avoided by some better forward thinking and work needs to be done on better future trends analysis, says Riddell.

"We tend as an industry to not look far enough ahead and then get surprised when things happen, and the future will always tell us that it was obvious that it was going to happen.

"The reinsurers, big reinsurers, tend to be good at looking at some of it, but how far have we gone in looking at what implications there are from changing demographics and the pension issues, and what will happen in what people do work-wise?

Another of Riddell's pet issues is compensation culture and he starred in a BBC Money Box documentary call "Sue You" before Christmas - that was one of the few pro-insurance industry TV programmes ever shown. So what does Riddell make of the fall of The Accident Group (TAG)?

"Conditional Fee Agrements still have areas to be resolved around it. The encouraging thing about TAG was that the set up was such that no individual claimant suffered. That's probably the most positive thing about TAG.

"Were they guilty of the worst sort of ambulance-chasing that they were accused of is hard to know, certainly some of the TV documentaries were less than complimentary."

Controversially, Riddell is one of just a few voices calling for the FSA to take a greater part in general insurance - albeit in talks over the future of liability. So how does he rate the FSA's performance in dealing with broker regulations?

"I think they showed they've listened and one of the great fears would be that they wouldn't have listened to every party, they would have taken an emotive response.

"I guess we've still got to see where it all ends up. A lot of the early speculation was ahead of knowing exactly what was going to be expected. Clearly, there's a bunch of introducers, representatives, tied agents - whatever you want to call them - who are desperately small and it's never going to make commercial sense for them to put procedures in place.

"The vast majority of the small broker, small/medium broker area is probably going to cope much better than many predict. The majority of them are professionals, and proud of that. They're independent businessmen, and that means they adapt to the realities and where they are, and they won't give up their freedom lightly.

"Now, some of the ideas of how they're supported may fit the pattern, give them adequate freedom, others may not. So I'm not going to tell you that I know how it'll end up, but the idea of massive consolidation doesn't fit the way these people do their business with the nature of them. They'll be more adaptable than people think.

"The network concept is unlikely to have huge impact unless it allows them to maintain independence, and there's a conflict there because if they have independence how do the FSA see it?"

One of the biggest battles of coming months will be over service standards. The OFT, FSA and the Department for Work and Pensions (DWP) have all picked up on the issue of adequate renewal periods - most backing a statutory 21-day period between quote and renewal date.

"Prescribing these issues commoditises the industry, and if we have professional distribution, isn't the point of professional distribution choosing people who have adequate standards on their renewals and they process their business properly," says Riddell.

"Yes, it should be a market differentiator, But it can prompt finger pointing, 'was it the broker delaying so he could retain it? Was the insurer lackadaisical so he didn't give the broker enough detail to get it properly requoted? Was it the insurer playing brinkmanship?' And I'm sure you'll find examples where any one of those three is correct."

Personal lines is an area that Riddell has had to reacquaint himself with. The big issue, he says, is size. "I think that the change in personal lines is that scale is becoming more and more of an issue and it's going to be interesting to see how the Royal Bank of Scotland move works and are they going to throw those to together.

"If you go into personal lines strategy, it's got probably three elements. How do you underwrite it? How do you operate as cost-effectively as possible? And how do you get customers through the doors? And the interesting development there is the customers through the doors. Also, is the direct market fully mature? So you're not going to see a greater market share going through direct. Is Tesco an anomaly or a trend? Is Tesco just filling a cheap broker role?"

With Riddell taking a day's golf with Hill House Hammond at Wentworth yesterday, I'm sure he would have had plenty of time to find out.

Curriculum vitae

PERSONAL
Name: Geoff Riddell

Born: 1956 - age 46

Married: to Eileen with one daughter Jennifer

Educated: Loretto in Musselburgh, Scotland, The Queen's College, Oxford Degree in chemistry

CAREER

1978 - 1982 PricewaterhouseCoopers

  • Accountant
  • 1982 - 2000 American International Group

  • Finance, IT, strategic planning and administration
  • US and international corporate business, facultative reinsurance placement and administration
  • Personal lines including direct telesales of motor
  • National management of operations in Hong Kong, Belgium and France 2000 - present Zurich Financial Services
  • Initially managing director of Zurich Commercial. Soon after appointed managing director of corporate and government businesses.
  • November 2002: appointed chief executive, general insurance, UK, Ireland and Southern Africa.
  • AFFILIATIONS

    ABI
    Member of ABI general insurance council since 2000; ex-chairman of liability committee

    INTERESTS
    Sports: hockey, golf