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Dave Harris

The managing director of Living Time says the company wants to reinvent the retirement market by moving away from the lifetime annuity and offering a much more modern approach.

Living Time managing director Dave Harris’s career in financial services can be traced back to a humble Vauxhall Nova which swung his choice between a job as a graduate entrant for Tesco and Friends Provident.

When Harris joined Friends, all graduate trainees were given company cars and he freely admits this was the only reason he chose to take the job but he has no regrets.

Harris’s father was a miner and steelworker and his grandfather emphasised to him the importance of getting good qualifications to get a job where he could benefit people.

Harris earned an economics and politics degree at Wolverhampton Polytechnic and spent three years with Friends as a sales consultant before being headhunted by Prudential.

He looked after Pru’s key accounts in Manchester and spent the next decade moving up through the ranks on the distribution side, becoming head of the IFA sales team in 1999.

Shortly after this, Harris was recruited by AIG to work in Asia. Initially, he was based in Hong Kong and then in Thailand, where he was vice-president for AIG’s distribution development, focusing on the direct salesforce of 40,000 agents.

“It was my job to modernise them and increase their activity and productivity, which I must say is the highlight in many ways of my working career because I travelled all around Asia.”

But this all came to an abrupt end after September 11, 2001, when AIG stopped a lot of the expat contracts. Harris came back to the UK and rejoined Prudential, running its corporate pension business and later heading distribution and marketing for UK, Europe and the Middle East.

He left Prudential in July 2007 and joined Living Time shortly after and says it was a very conscious decision.

“I did have offers to go to work for other big-brand companies but, to me, that is a different badge, same old thing. So when I sat down with Kim Lerche-Thomsen and he described what he is trying to build at Living Time, I found that it was an almost perfect fit with some of the guiding principles that had been ingrained into me by my grandfather.”

Harris says Living Time has two guiding principles that attracted him. “One is, we are going to reinvent the retirement market and manufacture propositions that are truly 21st Century. The second thing is that, in that process, we will not do anything unless it is good for the consumer, the adviser and the industry.”

He says this is radically different to big life offices’ approach, which is always profit-driven.

Living Time was the first company to launch fixed-term annuities in the UK. The product offers a guaranteed income for a fixed period up to age 75 and is more flexible than a lifetime annuity as the client is not locked in for life.

Harris says nine out of 10 retirees in the UK end up in a lifetime annuity and he believes this is a very old-fashioned approach to retirement.

“It is a much more modern approach to take your retirement in stages. You cannot imagine in the 21st Century that when you select a mortgage to buy a house for 25 years, you can never change it. Yet we do allow nine out of 10 retirees to end up in exactly the same scenario with their retirement incomes.”

Another issue for the at retirement market is the open market option. Currently, around 65 per cent of people end up taking out an annuity with their pension provider without shopping around for a better rate and Harris has been leading Living Time’s Offer More Options campaign which aims to increase the take-up of Omo.

The campaign was launched last summer and Harris says hundreds of IFAs have signed up in support. The next phase for the campaign is to change it from Living Time’s campaign to the industry’s campaign.

“Part of that will be encouraging other manufacturers to join. The only ones that are likely to want to join will be those that are innovative. There will be some that will not want to because, to be frank, they are almost killing their golden goose. There are a lot of traditional 20th Century manufacturers who are very happy for the current dynamic to continue.”

Harris would like to see the Omo become the default option and says there are advantages for IFAs in offering more options too.

“Once you have transacted a lifetime annuity, that is it, whereas if you stay close to that client throughout the stages of retirement that they go through, all kinds of things will change for that client and if the lifetime value of that client increases, the value of their business increases. Once the IFAs see that, it is almost like a light bulb moment for them. They are losing out and not just the consumer.”

Living Time is aiming to evolve into more than just a provider of income retirement products – it wants to become something like Saga and provide other support services to its customers and will be developing and launching further product lines, which Harris hopes will happen later this year.

Last year, the business grew by over 350 per cent. It is a privately owned company but its fixed-term annuity products are underwritten by Alico which is owned by AIG.

Harris says: “Alico is a massive life company, it is very strong and has assets that are significantly beyond its liability. It is completely ringfenced from the general woes of AIG so we are very pleased to have it as our underwriter. Clearly, the fact that it is owned by AIG and AIG as a brand has taken a bit of a battering at the moment has not helped us but it has not held us back.”

Born: Pontypool in South Wales, 1967

Lives: Southport with partner and two sons

Education: Economics and politics degree from Wolverhampton Polytechnic

Career: 2007-present: managing director, Living Time; 2005-07: distribution and channel marketing director for all intermediated business, Prudential; 2002-05: head of corporate pensions, Prudential; 2000-02: vice- president of distribution, AIG; 1991-2000: various sales roles at Prudential, becoming sales development director for the combined Scottish Amicable and Prudential IFA sales teams; 1988-91: graduate trainee and sales consultant, Friends Provident

Likes: The words ‘I can’, skiing, flying (he has a private pilot’s license), nature

Dislikes: Nine out of 10 retirees ending up in a lifetime annuity

Drives: Gave it back with the other corporate bling when I left Pru.

Book: The Power of Now by Eckhart Tolle

Film: Bolt

Album: Word Gets Around by Stereophonics

Career ambition: To get Omo working properly and to add value to consumers and IFAs in the process

Life ambition: To make as many of my family’s dreams come true as I can.

If I wasn’t doing this I would be… a skiing instructor or a nature warden

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