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Growing together IAG’s Peter Harmer says the merged CGU and Lumley commercial operations are making the most of their common ground By Jan McCallum
senior team had the task of integrating the A BIGGER CGU IS DEVOLVING DECISIONoperations. making to the states and rolling out strateMr Harmer says the work already done gies to help intermediaries grow their within CGU has made the task easier. businesses. But IAG Commercial Insurance It may seem obvious, but he says “you Chief Executive Peter Harmer expects can never communicate enough”, and CGU something back from brokers. has worked with staff on the “why” quesHe told the Steadfast Convention earlier tions: “Why should we do this? Why will it this year that brokers must change their benefit our customers? Why will it benefit mentality and switch from being transacour partners? And why will it benefit the tion-driven to advice-driven. employee as well?” He says he believed this when he was a In terms of generating a more agile and broker – he joined CGU as Chief Executive efficient organisation, the disruption of the four years ago after more than 20 years with merger has been minimal and worth the Aon – and he felt comfortable saying it to an pain. audience who knew he had stood in their “We have been mindful of the impact on shoes. our people, and as we reconfigure the The message has mostly been well organisation it is clear there will be fewer received, Mr Harmer tells Insurance News, roles in the future.” with brokers telling him they agree and that But some productivity improvements “sometimes it needs to be held up in front of will take time to deliver because they are sysus”. tems-driven and there is no quick way to “One thing that’s healthy about our harmonise systems, so Mr Harmer believes industry is we are prepared to take a chalnatural attrition will minimise the impact on lenge and take it in the spirit in which it is staff. intended,” Mr Harmer says. The industry is starting to see the results “I believe in the advisory model, but my of a 100-day project to understand the busifear is that if collectively we don’t accept ness, with the aim of adopting the best of responsibility for addressing clients’ needs IAG and Wesfarmers. rather than simply trying to sell a product, There will be new policies from next then we will slip into an endless spiral of April, and new state managers announced irrelevance.” last month will have a greater degree of Does he see brokers taking his words on autonomy. board and acting on them? “A lot of underwriting authority is going Mr Harmer says he doesn’t expect to to the states, and the state managers will be change the industry, but “what we did equipped to be responsive to the brokers in expect was that we would identify a few partthe brokers’ time and not CGU’s time,” Mr ners who were interested in working with us, Harmer says. and we have”. “A lot of this is tied up in culture, and we “We have identified a number of brokers have moved our culture significantly.” – most of these I now refer to as preferred Wesfarmers Insurance staff had known partners – that we are helping build sales since October last year that they were in a campaigns for.” sale process. These campaigns are not about selling IAG became involved a month later and CGU products. “They are about understarted communicating with them in standing customer need. It’s just an entirely February, with Wesfarmers’ approval. different philosophy.” Mr Harmer did a series of roadshows to CGU had been undergoing its own Wesfarmers Insurance and Lumley staff, transformation when IAG made the $1.845 who he says maintained enthusiasm and billion acquisition of Wesfarmers’ underenergy despite the uncertainty. writing and broking assets on July 1. The 24
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