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Mike Kellard

Winterthur Life’s chief executive believes depolarisation will actually polarise the industry further and has positioned the life office to take advantage of a growing interest in independent advice from highnet-worth individuals.

When Winterthur Life chief executive Mike Kellard needs inspiration, he dips into Touching the Void, the strangely uplifting tale of how mountaineer Joe Simpson dragged himself down a mountain with a severely broken leg.

While financial services is thankfully seldom as painful, Kellard appreciates the single-mindedness of Simpson and his determination to overcome any obstacles thrown into his path.

Since taking the helm at Winterthur some 18 months ago, Kellard has been similarly determined in overseeing a raft of changes which have lifted the life office’s reputation in terms of product innovation and service quality.

In a market where companies can live and die by the service they offer IFAs, recent industry accolades have provided recognition of what has been an important turn-round for the group.

“I started work as a waiter and knew that if I did my job, I would receive my salary and a few tips but if I put maximum effort into providing a great service, then I would enjoy my working life a lot more and double my salary in tips. That is something that has stuck with me in life. Service is a big part of our offering and we have enjoyed a very strong transformation.”

Kellard is also confident that the group has the products to differentiate itself in a congested market. He asserts that Winterthur’s product launches have gone on to be copied by many a rival which, although frustrating, is also flattering and to a certain extent inevitable.

He is clearly proud that Winterthur was one of the first providers to launch into the self-invested personal pension market and to offer drawdown. Its bond was also one of the first to allow investment in funds of funds. In addition, the group has a hefty 33 per cent share of the trustee investment plan market.

“If you do something successful, people will copy you, which is not a bad thing as it can open up the market more. For example, just because more providers are coming into the Sipp market, we are not seeing our volumes decrease but awareness of the benefits of the product is growing.”

Winterthur took 249m into its Sipp in 2004 despite the entrance of big players such as Standard Life, albeit late in the year.

Kellard believes the group’s pension range is well positioned for life after A-Day and only minor tweaks will be needed nearer the time.

The onset of depolarisation is changing the shape of distribution, however, and Winterthur is in the process of building up its salesforce from 30 to around 50. The group prefers to call them business development managers to stress its partnership approach to IFAs.

Kellard believes depolarisation will have the curious effect of actually polarising the market even more than it is now. He asserts that the bottom end of the market will almost exclusively be serviced by bancassurers while more high-net-worth individuals will seek independent advice – an eventuality that Winterthur is more than ready for, if not welcoming.

“The strategy we have chosen is not the mass-market approach but to focus on marketing ourselves to growing parts of the marketplace. There are now over 750,000 millionaires in the UK, more than the number of teachers, so our target market is big and getting bigger all the time.”

It is his firm belief that these are the clients who most value independent advice and are loyal customers of Winterthur precisely because it is not a mass-market organisation.

The focus on high-net-worth individuals also means Winterthur’s average case size is between five and 10 times the industry average, according to Kellard, helping it to become increasingly profitable.

“A lot of the tools we are bringing out, such as our portfolio balancer tool, a risk management and asset allocation aid, are designed to help advisers provide an holistic service to these wealthier individuals.”

Other initiatives have included Professional Edge, a consultancy-based service which helps advisers develop links with solicitors and accountants and service high-net-worth clients.

Kellard says some IFAs have taken this stance the wrong way and believe Winterthur is anti-commission. He stresses that this is not the case. Commission is not automatically built into Winterthur products but can be bolted on if requested.

He thinks the whole commission versus fees debate is something of a smokescreen. He believes that if you ask someone whether they would rather pay for a service without having to write a cheque for it, they will nearly automatically say yes. But if you flip that loaded question on its head, then few people will say: “Yes, I would rather you did not search the entire market for the best product but chose a commission-loaded one.”

On a personal level, Kellard is keen to be in a position where he can spend more of his time with his family and get his golf handicap down to a more respectable level. A keen sportsman, he has also been missing the ski slopes and, as soon as his young son, Jack, is a little older, he will take him on the piste.

Kellard grew up in a sporting family and his father’s job as head of BBC Sport Scotland meant that many a local sports hero would pop round for tea.

Still passionate about active pursuits, he will not rest until Winterthur is the first name on the lips of IFAs when they think of a specialist life office.

Born: County Antrim, Northern IrelandLives: Bramley, Hampshire, with wife Anne and son Jack, twoEducation: Belfast Academic Institute and Glasgow College of CommerceCareer: June 2003present Winterthur chief executive; 1999-2003 Winterthur managing director, group sales and marketing director and sales director; 1994-99 Norwich Union Life & Pensions national sales manager; 1992-93 Scottish Provident area manager; 1984-92 Legal & General broker sales consultant; 1982-84 Davidson Partners broker sales consultantLikes: People who are delivery-focused, honest and get to the point quicklyDislikes: People who prevaricate, are dishonest or just do not deliverLife ambition: “To spend more time with my family than I currently do”

Career ambition: “To make Winterthur the first choice in the IFA and EBC high-net-worth space”

Heroes: “My wife for her understanding and looking after our son and my father for showing me that ethical values are more important than success alone”

Drives: BMW M3Hobbies: Playing golf, cycling, skiing, scuba diving and following rugby


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