The song ‘Where have all the flowers gone?’ came to mind at a recent compliance conference I attended. It was held in the Great Hall of the Chartered Insurance Institute building, which features wonderful leaded windows emblazoned with the names of countless long-forgotten insurance companies. Where, indeed have all the insurance companies gone?
This led me to reflect on those that have disappeared since April 1988, when regulation really started to bite. It is common knowledge that of 250,000 advisers registered with FIMBRA in 1988, we are now down to fewer than 25,000. What is less appreciated is about 80 per cent of insurance companies have also disappearedduring the past 30 years of ever-increasing regulation.
To check my memory, I referred to the Life Insurance Association’s Year Book for the period and found some 160 life companies listed, whereas one would be hard pressed to name a couple of dozen today. Purists would argue their policies were not always the cheapest, but they did an invaluable job for the many consumers they served, helping them protect their families and save for the future.
One such company was Abbey Life, which I joined as a commission-only direct salesman in December 1970.I took to selling life assurance like a duck to water, which is just as well as we had three young children. A few months later, as the only survivor of the seven hopefuls who joined Abbey Life with me, I realised the enormous risk I had taken. I did however have the benefit of a mainly self-taught background in psychology, economics and investments, and I also believed passionately in the importance of saving and life assurance protection.
I am proud to say that I hold this belief just as strongly today, as I have yet to see a better solution for savings and protection than the miracle of life assurance. I am equally proud that financial advisers are increasingly being appreciated as highly trained professionals.
While therefore it is a reality that many insurance companies have gone, there are still thousands of individual advisers delivering high quality services to a public who have a desperate need for their advice.
Ken Davy is chairman of SimplyBiz Group