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It is all in a name, according to Mark Goodale, chief executive of Reliance Mutual, who believes that its current strength is down to exactly what its namesake is. And having completed its seventh acquisition in five years and standing at more than 6m annual premium equivalent Reliance has definitely been rubber stamped by the industry.

Mr Goodale said: “We are reliable and a mutual. All our policyholders are members and we will not pursue strategies that are not in the interests of our members. We have a low-cost strategy and have an infrastructure that has a focus on unit costs and we intend to maintain that unit cost position.

“We are also three times the size than we were in 2002, with rapid growth in assets through acquisitions – that has been the main growth in assets.”

So who is the driving force now leading the 97-year-old Kent-based mutual? Having moved to South Africa with his family when he was 12 years old, Mr Goodale focused on mathematics, statistics and economics at school and university. He qualified as an actuary in 1985 and took on a placement with Prudential in 1976, where he moved up to supervisory positions for Anglo American Life and Commercial Union.

He said: “At that time, the South African market was very entrepreneurial, light-touch, risk-taking and was about learning from mistakes. Interesting new things were being tried and there were opportunities to do that, as nobody at that time had done it yet.”

Returning to the UK in 1986, he took up roles for Manufacturers Life Insurance UK Division and was actuary to the joint venture between Manulife and the Bank of Cyprus. A decade later, he became director of Ecclesiastical Life and Hinton and Wild (Home Plans) and was general manager of the financial services division and a member of the executive management team for Ecclesiastical Insurance Group.

His thirst for opportunity has also seen the father-of-three donning a number of hats while sitting in the driving seat at Reliance, as he is currently the director of the Association of Mutual Insurers. In addition, he headed Safe Home Income Plans, the trade body for the equity release industry, from 1996-2006.

Mr Goodale has also experienced at first hand how the UK annuities market developed between the 1980s and 1990s. He said: “Most insurance companies were trying to have a full product range of investment and protection products, but most providers were focusing on investment and pension accumulation.

“There has been severe competition – margins have squeezed and companies have withdrawn, merged or are much more focused in their strategies. With the baby boomer generation, there is a much greater focus on retirement products than there was 20 years ago.”

With these targets in mind, the 53-year-old recalled how he first stepped onto the Reliance Mutual ladder. He said: “Reliance already had this focus and this is what attracted me, as it had products to achieve long-term goals. It was about focusing on niches, and this is the way smaller companies should be going. There are opportunities for smaller players to focus on things that larger players are not doing.”

Reliance has been a traditional direct sales company since 1911, focusing on door-to-door type sales before moving into the broader businesses in the 1970s and 1980s, with a large direct salesforce.

The mutual started out as an offshoot of another company, the Reliance Fire and Accident Insurance Corporation, which, in June 1906, had started to write general insurance business with policyholders paying weekly premiums.

Many moons later, the Pensions Review in the late 1990s put a lot of stress on its capital resources and it downsized before parting company with the salesforce in order to restore the capital strength of the company.

This is evidently so, as Reliance has recently completed its seventh acquisition in five years, after buying another block of business from Family Investments.

In 2004, when Reliance acquired 23,500 policies – representing £260m in assets under management from Family Investments – legislation did not explicitly permit any tax-exempt friendly society business to retain its tax exemption when transferred to an insurance company. As a result, a number of policies could not be transferred as part of the original agreement. That restrictive legislation was amended in the Finance Act 2007, enabling those policies to now be transferred to Reliance Mutual.

Mr Goodale pointed out why such acquisitions are the way forward. He said: “The new business growth has not provided the same growth in assets as the acquisitions. We talk to the smaller companies – particularly mutuals, but not always mutuals – and if they do not want to remain independent, because it is not in their policyholders’ interest, it may make sense for them to transfer business to us, or more certainty in these volatile positions, so we may be able to de-risk their position.”

Mr Goodale believes this strategy has put them in a good stead for facing challenges head on. He said: “We are remarkably resilient to any of the changes happening in the current market at the moment. It has created opportunity rather than a threat. We have a relatively clean investment portfolio and from an asset perspective we have not suffered severe impairment.”

Mr Goodale proudly states that the company has seen a boom in annuity products with its offering of niche and competitive products. For example, in measuring itself in the industry’s annual premium equivalent – in the comparisons of the amount of new business gained in a period by insurance companies - it was more than 6m – with about 60m single premiums of annuity business being sold.

And there does not seem to be any budge in reaping the rewards. Mr Goodale said: “We want people in worse health than better health; as if the better health people come we are going to have to worsen our rates. We are not really seeing any effect at all and we are watching our mortality very closely, at this stage, but in theory over time, we will need to react to that and change our product.

“The product and customer segmentation is just going to continue. There will be more targeting and we will react. In order to maintain significant volumes of business, you need competitive rates and we will continue to provide this.”

In heading back to the future, Reliance intends to broaden its strategy, and the product range it offers on the market place, including its ‘at retirement’ space which aims to provide a stage to display its wider offerings. Mr Goodale said: “From a strategic point of view, it is the right place to be, there is no doubt about it. It is about finding the right product additions to enhance our offerings. We are not just looking at annuity products, we also feel that our focus in protection in terms of working and labelling for distributors. We have been in the protection market space for a while, but not selling in any material volumes.”

Mr Goodale believes Reliance has been constrained from a capital point of view, so he wants to target plans that do not chew up all the capital. He said: “The future for us is in the new business area. We will continue to do acquisitions, but not as frequently as we have done in the past. Developing our new business capability is the focus from here on in. There will be continual challenges so one has to be nimble. We have a viable future.”

Girlie Garduce is features writer for Financial Adviser

Mark Goodale: CV

2006: Chief executive and director of Reliance Mutual Insurance Society.

1996: General manager of the financial services division and member of the executive management team of Ecclesiastical Insurance Group.

1995: Various actuarial and management roles for Manufacturers Life Insurance UK division, including chief financial officer and appointed actuary

1986: Assistant actuary for Commercial Union of South Africa.

1982: Pensions actuarial manager for Anglo American Life, South Africa.

1976: Actuarial and marketing roles for Prudential of South Africa.