The Association of British Insurers’s (ABI) membership has resurged somewhat in recent times – with Nationwide Building Society becoming the latest organisation to join the trade body.
News of the building society’s inauguration came hot on the heels of the announcement that Old Mutual Wealth had rejoined the trade body after eight years away from the organisation.
The recent membership hike marks a reverse in fortune for the body, which recently moved from expensive Gresham Street headquarters in the City in a cost-cutting exercise to mitigate the financial impact of dwindling membership in recent years.
Skandia, which was purchased by Old Mutual in 2007, ditched the ABI in a dispute over proposed changes to the sales rule book, and joined forces with the Association of Independent Financial Advisers – later rebranded as the Association of Professional Financial Advisers.
More notably, in 2014, Legal & General relinquished membership of the association, claiming that much of its business had fallen outside the ABI’s remit following the merger of the body’s investment unit with the Investment Management Association – latter renamed the Investment Association.
In a letter sent to then-ABI director general Otto Thoresen, who is now chairman of the National Employment Savings Trust, L&G’s chief executive Nigel Wilson also expressed a belief that business models of sector participants become more diverse and less suited to uniform representation through one trade body.
Similar reasons were given when Aegon UK quit the ABI in the latter half of 2015. Its chief executive, Adrian Grace, explained that the time was right to leave the trade body to put the company’s point of view to the government and regulator directly, and to pursue its radical modernising agenda, with an emphasis on developing its platform, to meet the needs of consumers.
Malcolm Small, executive chairman of the Retirement Income Alliance, said: “The ABI concentrated on the general insurance sector – the hint is in its title – but many insurers have made changes to their business models. Standard Life, for example, is more of an investment house now, and you would think that insurers with a similar model would align themselves with other bodies such as the Investment Association.”
The departure of two industry juggernauts proved to be a huge blow for the association, but the ABI was not down for the count. To stretch the boxing analogy further, the trade association readjusted its footing with the launch of a comprehensive reform package at its Biennial conference in November last year.
At the event, the ABI announced the appointment of Seraina Maag, president and chief executive of Europe, the Middle East and Africa at American International Group, and Russell Higginbotham, chief executive of Swiss Re UK & Ireland, to the ABI board, as part of a number of measures to make the organisation a “modern, lean and agenda-setting” business.
The board has since swollen, with the addition of Anthony Baldwin, Antonio Lorenzo, Vibhu Sharma and Julian Adams of AIF, Scottish Widows, Zurich and Prudential respectively.