Andrew Bibby



Andrew Bibby is a professional writer and journalist, working as an independent consultant for a number of international and national organisations, and as a regular contributor to British national newspapers and magazines. He is also the author of a number of books.

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Profile of a chief executive:

Lindsay Sinclair (NFU Mutual)

This article by Andrew Bibby, in a slightly different form, was first published by ICMIF (International Cooperative & Mutual Insurance Federation) in Voice magazine, 2010

It has taken more than thirty years for Lindsay Sinclair, the chief executive of NFU Mutual, to make the journey from the south coast of England where he got his first job (a junior in a local bank branch) to Shakespeare's home town of Stratford-upon-Avon ,  where the insurance company he leads has its head office. 

Travel by car, and the distance is something just over two hundred kilometres.  Lindsay's career route has, however, been a rather more roundabout one.   “I had a really burning desire to see the world,” he says, putting it down to the fact that he is by birth a New Zealander, a ‘kiwi'.  “Although we emigrated from New Zealand when I was seven, I'm sure it comes from this.  Kiwis are always talking about ‘overseas experience', they say ‘Have you had OE?'”.

Lindsay has certainly had OE in bucketloads.  His career has seen him working for major banks such as Standard Chartered, Barclays and ING, increasingly in senior management positions, in a variety of parts of the world:  Hong Kong , Singapore , Malaysia , London , Bahrain and the Gulf, San Francisco and Sri Lanka all feature on his career resume.  Then there were the several years working for ING in the Netherlands , when he had responsibility for part of the Dutch bank's strategic development of new overseas markets.  The Netherlands in fact has, over the years, effectively been his second home.  His wife is Dutch (they met when they were both working in the Caribbean, in the Dutch West Indies) and one of their two daughters currently lives in Holland .

After such a globe-trotting life, the sleepy middle England town of Stratford might seem a surprising destination.  NFU Mutual itself might, not entirely unfairly, be described as a comfortably conservative organisation, and certainly when the company appointed him in 2008 as their new chief executive some eyebrows were raised.  NFU Mutual's previous head, Ian Geden, had been with the company throughout his career, and Lindsay's appointment was the first time that NFU Mutual had looked outside its own staff circles for the top job. 

Lindsay admits the approach came out of the blue.  One of the first things he did, he says, was to find out more about the business, a fact-finding exercise which involved him talking to agents and staff, without letting on that he was potentially their new chief executive.  “The more I researched NFU Mutual, the more I found that it had a very special business model, great people and a very strong sense of values.  There was a lot about the importance of customers.  That spoke to the heart,” he says.

NFU Mutual celebrates its centenary this year.  Its initials stand for the National Farmers Union, the main organisation for farmers in the United Kingdom , and for all 100 years of its life NFU Mutual has been steadfastly serving the farming sector and the rural community.  It is two years younger than the NFU itself, and was set up by seven farmers who wanted to provide insurance products tailored for NFU members.  NFU Mutual continues to have close links to the NFU (which despite its name is an association rather than a trade union) and acknowledges these with financial contributions, typically of around GBP 5m (USD 7.5m) a year.

Ten years ago, NFU Mutual took the strategic decision to look beyond the farming market.  “Our business is now about 50:50 farming and non-farming.  But we are still recognised as the largest rural insurer and farming is our heritage,” Lindsay says.  NFU Mutual currently has about 900,000 policyholders, and in 2009 had gross premium income on general insurance business of just over GBP 1 bn (USD 1.5 bn);  life business is less developed, about a fifth of the size of the general business in terms of numbers of policyholders.

Even if NFU Mutual now actively seeks customers outside the world of farming, the links with the NFU remain very close in the distribution channels the insurer uses.  Tied agencies (there are about 320) are the most important interface between policyholder and insurer, and in almost all cases the agent doubles up as the NFU's local group secretary.  A network of financial consultants is used for life, investments and pensions business.

The use of agencies as the primary distribution channel seems superficially a long way from the model which Lindsay Sinclair successfully developed before moving to NFU Mutual, when he was responsible for building up ING Direct, the UK subsidiary of Dutch bank ING.  ING Direct, as its name suggests, was almost entirely based on online and telephone banking; it offered highly attractive rates of interest on relatively simple financial products and from a standing start expanded in three years to have over a million customers.  “We were the antidote to the way the big banks were treating customers,” Lindsay explains.   

Whilst NFU Mutual is now cautiously experimenting with internet and out-of-hours telephone facilities for customers (the project is known as the Integrated Delivery Programme), the agency network remains paramount, and indeed the business is at present looking to expand the agency network, both through spin-off branches of existing agencies and some pilot agencies in brand-new urban locations.  What ING Direct and NFU Mutual do have in common however, according to Lindsay Sinclair, is a strategic focus on the importance of customer satisfaction.   It is here that he sees the strong advantages of his present company's mutual status.  “What's really interesting is that there is a lot more talk generally today about values-based businesses.  People are focusing on this, it's seen as giving stability to the economic and financial system,” he says. 

As he points out, since mutual businesses are owned by their members, their role almost by definition is to be run for the benefit of the members.  “Mutuality is first and foremost about customer service,” he explains. “NFU Mutual's philosophy since Day One has been to provide its customers with the insurance cover they need, at a fair price, and with a first class service.”

Certainly, NFU Mutual enjoys tremendous loyalty from its policyholders, with very high renewal retention rates.  NFU Mutual reciprocates this loyalty with a ‘mutual bonus' reduction on renewal premiums which is structured so that longest-standing policyholders benefit the most.  The mutual bonus typically sees premiums reduced by around 8%.

Lindsay Sinclair is aware however of the need to move forward.  Looking ahead, there is the strong long-term potential of growing NFU Mutual's market share in the non-farming market.  “I think we've got great opportunities in non-farming.  We've got about 4% of our target market at the moment, so there is 96% to go after,” he says.  As he points out, this strategy helps diversify the company's risk profile (NFU Mutual has suffered from claims from the result of serious floods in Britain in recent years).  However, it also makes sense in terms of the core market:  farmers themselves are increasingly looking to diversify and to move into areas of business beyond traditional farming.

The other obvious challenge is to build the life side of the business, currently very much a small part of the whole.  “Our strategy is to acquire customers through the general side, and then sell life products.  About one in five, or 20%, of general customers have life policies, but that leaves us with 600,000 policyholders who haven't yet bought life policies from us,” Lindsay says.  His eventual aim, he says, is to get that closer to 50%.  To achieve this, NFU Mutual is looking to develop its network of financial consultants, as well as its own agency chain.

In addition to the main Board, NFU Mutual is structured with a series of seven Regional Advisory Boards, which act as consultation bodies and which meet twice a year.  There is a network of local Member Forums which meet annually, and which provide a direct point of contact with policyholders.  NFU Mutual's formal governance procedures are closer to those of a shareholder voting system, in that member votes are allocated on the basis of the size of the business each member has with the insurer, rather than simply according to one member-one vote. 

When he took over the reins at NFU Mutual, Lindsay Sinclair says, there were some who expressed concern about the direction this newcomer might take the business. His message in reply was that whilst every growing business has to embrace change, he also clearly understood the strengths which come from NFU Mutual's long-established business model and close links with the farming world.  As well as steering NFU Mutual forward, he is also offering his support to the wider world of mutual and cooperative insurers through his membership of ICMIF's Board, a role where his knowledge of business realities worldwide (and his fluency in several languages) is a clear advantage.  “I very much enjoy getting to know other cultures, and I enjoy meeting people from different backgrounds,” he says.

But as well as work there is time for family life.   He and his wife stay closely in touch with their daughters, and there is now a grandson to visit, too.  There is time to enjoy the English countryside, as well:  after trying softball in California , going sailing in Bahrain and playing tennis in Hong Kong , he is rediscovering the pleasures of going for long walks in the gentle English landscapes which he first discovered as a young boy.

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