Appetite for deduction

Nick Starling, the recently appointed director of general insurance at the Association of British Insurers, admits he is on a sharp learning curve. However, while he will also readily admit he knew very little about the functions of his previous employer - the Health and Safety Executive - before joining, the profile and notoriety he gained during his six years there bode well for his chosen path and for the ABI itself.

Citing the need for personal and professional change, Starling says he relished the opportunity of a senior position at the ABI. "The ABI has a very high reputation at a political level and, in many cases, it is the first trade body the government will contact at the planning stage with a wide range of projects. It is also a voice that frequently pushes itself to the fore in the media, such as on the BBC's Today programme."

But, did he have any qualms about taking a number-two role before the top job had been filled? "Not really; I did not see the shortlist and think I could have worked with any of the candidates. Having worked as a civil servant for a number of years and at a Whitehall department before that, I am used to working and dealing with many different people."

However, Starling's favourable view of the ABI is not one held by some in the industry. When asked if he was aware of the sarcastic reference to the ABI being 'The Association of Both Insurers' - referring to its representation of both life and general insurers - and the perception that this compromises its efforts to champion the cause of one as it may offend the other, he says: "I see no evidence of that; as I said, the ABI is already highly regarded in government but I intend to ensure there is proper representation for all stakeholders."

Hands-on strategy

And Starling does have a hands-on strategy for achieving this, having already visited senior staff at Norwich Union, Axa UK, Royal & SunAlliance and Groupama - and he even has larger brokers on his hit list.

He continues: "There are sentiments shared across the industry about its image and the very fact that there is one voice representing an industry as diverse as the insurance industry makes it a very powerful one." In terms of getting to grips with any skeletons that may lurk in members' closets, he states: "I want to get beyond skin deep with members and it is crucial that they are straight with me. I place great emphasis on having meaningful relationships and dialogue with members in getting to know and being able to represent the genuine issues."

Starling goes on to demonstrate that he is assured in his experience and ability to achieve this. "The HSE is not like other government departments, it is very hands-on and it engages with what is happening in the real world. I dealt with a huge range of issues of enormous public interest and visited different sites from nuclear to agricultural, offshore to construction, and I do not now intend to sit behind a desk pushing paper and attending endless meetings for the sake of it," he asserts.

Starling's stated disinterest in becoming a bureaucrat and the emphasis he places on close relationships - a sentiment close to the industry's heart - may not convince the diehard dissenters of the ABI's clout. But, he responds by throwing down the gauntlet. "Members do not need to wait for me to visit them to make their views and concerns known - pick up the telephone and tell me," he exclaims.

Concerning his three-year secondment from the HSE, Starling is quick to point out that this does not necessarily mean he will go back. "This is a technical term, which has more to do with my pension arrangements than anything else. I was on secondment to the HSE for two years but ended up staying for six."

Starling also uses this issue to further stress his commitment to getting his teeth into the role. "I am fully under the ABI's terms and conditions of employment and am on a three-year secondment - but I would be surprised if I actually left after three years."

Regarding other experience he brings to the role, Starling says he knows what it is like to work for an institution that is misunderstood and mistrusted.

"There is the misconception about the HSE that it is preoccupied with risk management but it isn't, it is about enabling people to do things. It is not there to make people risk-averse."

To this end, Starling says the HSE wrote to the headmaster who famously directed that children playing conkers in the playground wear goggles.

"We wrote to him saying that he was giving risk management a bad name because it was risk-averse."

A startling insight

As for Starling's timing in taking up his new post, this offered an opportunity to witness the insurance industry on red alert. With the occurrence of some of the worst flooding for centuries at Carlisle and one of the worst natural disasters ever in the form of the Indian Ocean tsunami, Starling, true to his hands-on approach, hit the claims floor. "This gave me an excellent insight into how people affected were dealt with sensitively and swiftly," he says, adding: "It was also an opportunity to engage with the people co-ordinating an effective response to a crisis, which gave a great sense of some of the high standards of people and practices within the industry."

Referring to the negative publicity the industry came in for from the national media over Carlisle and Boscastle, Starling goes on to explain how raising the profile of insurance is firmly on his agenda. "One of the main things that Mary (Francis - former director general of the ABI) asked me to do was to raise awareness - particularly of the social and economic value of insurance.

"While, contrary to popular opinion, some good stories about insurance do appear in the national press, generally - out of 3000 claims, 2999 are dealt with - the media picks up only on the one that was declined.

The ABI has and will continue to write to editors of national newspapers to set the record straight, but editors do not like it if you criticise their star journalists, so sometimes our efforts are not seen, as letters sometimes do not appear for this reason."

He adds that the insurance industry is not alone in its poor public perception, with the following observation about a factor common to other sectors: "People rely 100% on insurance and it is the case that people invariably attack an industry on which they rely."

While his awareness-raising campaign will not stretch to televised advertising extolling the virtues of insurance, Starling is keen to present a united front with other industry bodies and federations. "I have met with Eric (Galbraith, of the British Insurance Brokers' Association) and Sandy (Scott, of the Chartered Insurance Institute), both of whom are very keen to work with the ABI on promoting the industry. There will be research and assessment to this end and other ongoing work to tackle this effectively in future. This will involve getting good stories in the press, among other things. Environment Minister Elliot Morley stood up in parliament after the flooding in Carlisle and applauded the industry for its part and basically went on record to state it had kept its side of the bargain."

On the prospect of the huge task of challenging the public's perception of insurance, he continues: "Insurance is a hard sell but it is one in which I believe. It delivers tremendous economic and social value, without which modern society could not grow and thrive. The HSE was also sniped at and there were a lot of stories that were unfair or misrepresentative, so I am used to this sort of challenge."

FSA bureaucracy

Another huge issue facing the industry was highlighted in parliament recently when Lord Hunt of the Wirral lambasted the Financial Service Authority for its preoccupation with bureaucracy at the expense of addressing the problem of underinsurance.

Starling says: "The way this has been presented to me is that it is not just underinsurance but non-insurance. We are conducting research to ascertain whether this is due to cultural, financial or other reasons; figures I have seen suggest that one in four people do not have home insurance. I have had some involvement with the FSA on this so far and will continue to do so on this and other issues."

As an ex-policy-maker, Starling is supportive of the FSA's regulatory style. "At the HSE we took the view that regulation should only be there when necessary, containing a goal-setting element ensuring safe operation. And, like the FSA, we also took a risk-based proportionate approach with a light touch."

Referring to the question over whether regulation adds any real value to customers, as voiced by Andrew Torrance (Professional Broking, February), who cited longer telephone calls plus the extra £3 charge per policy, Starling is in agreement, up to a point. "The ABI's view was that the additional charge was not necessary and opposed it. But - and this is the trade-off - if regulation achieves what it intended and customers get better service, it is for the overall good."

With his obvious political connections, Starling hints that this will benefit the ABI's lobbying efforts. "I know how Whitehall works and I have spent a lot of time lobbying. The ABI already has an ear with government on this front but I am finding that I am dealing with a lot of the same people. It is vital with lobbying to engage efforts early in the process. As well as this, we will lobby through The European Federation of National Insurance Associations or directly and this is a major role. If legislation is proposed we will work with government departments, but we must also have this multi-pronged approach."

As previously stated. Starling has an agenda to gain feedback from brokers, in particular to visit larger brokers to ascertain a genuine feel for their perspectives and issues. One of the issues these firms may want to address is that of standard practices among insurers.

Standard practices

Using the example of terms of business agreements, where many brokers had to spend money with lawyers to establish appropriate wording, would standard practice have saved time and expense for all concerned and is standardising practice in general on Starling's agenda?

"This is not an issue I have come across. The ABI has produced work in the past on contract certainty with guidance on how contracts should be structured. Members should take a principles-based approach; it is difficult to prescribe standards for all situations."

That said, Starling is concerned that all insurers have the right processes to filter spurious claims. "Compensation is fundamental to insurance and it is important that the right compensation goes to the right people at the right time. Statistics show that the number of claims is static but it is the cost of handling claims that has gone up. If, as an example, an adviser tells an insurer to pay out £5000 to save the potential legal costs of going to court of £50,000, this fuels a culture of risk-aversion. It is time that standards were pushed for simpler, straightforward processing to filter frivolous claims and ensure funds are directed quickly to legitimate claimants."

While Starling is clear about rectifying the public's opinion of insurance, addressing some attitudes towards the ABI may prove to be almost as challenging.

However, given his strong track record and, with a dogged determination and desire to have the attention and confidence of the ABI's members, he has put the ball firmly in their court.

CV

2005: Appointed director of general insurance, Association of British Insurers

2000: Appointed to the Health and Safety Executive Board as director of safety policy, subsequently director, policy programmes

1998: Joined the Health and Safety Executive as head of nuclear and hazardous installations policy

1984: Joined the Department of Transport, where he held a range of policy posts, primarily in aviation, highways and railways, and as private secretary to the Minister for Roads and Traffic.