When Royal & Sun Alliance closed its books to new business last
year, its corporate business director may have predicted that
difficult times lay ahead. Little did Mike Warr know that a new post
was waiting for him a short walk across Liverpool's dockside area.
From his new desk in the Royal Liver building, a construction that
has dominated the waterfront skyline since 1911, Warr looks on his
old Royal & Sun Alliance office with mixed feelings.
Taking over as Royal Liver director of IFA operations and development
– and two months later adding the role of chief executive of Park
Row, the IFA group it recently bought for £16.7m – offered Warr
the perfect way out of a work environment that he describes as the
worst of his career.
Late in 2001, he was given responsibility for tying up the many loose
ends of R&SA's pension review, which saw the life company being
hit with the biggest-ever fine for pension misselling. At
£1.35m, the fine was more than double the £600,000 paid by
Warr says: “Taking over the administration of the pension review was
the worst thing I have had to do in my career. I took charge of the
review from late 2001 and saw it through to the finish. That was not
an enjoyable experience – not something I would want to repeat.”
The fine was severe because R&SA had already been fined
£225,000 by the PIA for pension review failings in 1997. The
£1.35m fine came in August 2002, around the time that
beleaguered group chief executive Bob Mendelsohn, who has since left,
was announcing 1,200 job cuts.
The experience is something he is not at liberty to talk about in
detail, other than to say it involved an exhausting and lengthy
process of negotiations with the FSA. Warr says: “There are books
that could be written about the pension review but I want to put it
At the end of a bleak year, which culminated in the closure of
R&SA's life book to new business, Warr was understandably open to
decent offers. He was approached by Royal Liver chief executive Steve
Burnett in classic financial services fashion – on a golf course.
Warr, who had known Burnett as an operator in the group risk market,
leapt at the chance.
Warr sees Burnett, the first Royal Liver chief executive not to have
risen through the ranks, as the driver of change at the 150-year-old
friendly society. Burnett has brought in Warr to develop Royal
Liver's distribution channels and buying Park Row is a large part of
Warr becomes chief executive at Park Row, taking over from Rick
Abbott who has moved to the role of chairman. Park Row made a
£9.3m loss in the 15 months to December 2002 but Warr says it is
on target to move into profit by the end of the year.
He sees Park Row remaining independent and says he does not want to
interfere with its business model because that is why it was bought.
With Royal Liver looking to develop its protection products, Warr
will find a distribution channel in Park Row's strong mortgage arm.
Warr is not ruling out further IFA acquisitions but any firms he buys
are likely to be absorbed into the Park Row operation. “We are being
approached by IFAs all the time. Park Row will remain our IFA brand.
We don't want to buy little stakes in firms so anything we bought
would have to come into Park Row,” he says.
Warr wants to see Royal Liver's large existing book work in the
Sandler environment. The friendly society has five million live
policies and still maintains a direct salesforce of 300 and a further
250 home-service agents, with an operation of a similar size in
Ireland. Warr can see the potential of making all these people
“Sandler sales staff”.
He says: “In the UK, we are one of the few organisations with the
opportunity to sell Sandler products. Royal Liver has this huge
client bank. At present, the 250 home service agents only collect
money and the people they talk to are the target market for Sandler
products. These agents could become salespeople for the new Sandler
He sees Park Row expanding its adviser numbers to 550 by the end of
2005 from a current level of 300. He acknowledges that this may
include second-tier advisers in the new regulatory environment but
argues that it will be good for the industry in the long term.
“It is silly to say you will not look at multi-ties. The model has to offer
options for people coming into the industry. You can see a new career
path developing where staff start off as Sandler salespeople, then
become multi-ties and eventually move up to IFA.”
Warr's career path shows that the home-collection agent of yesterday
can make it to the top. After leaving a Bristol comprehensive with
five O levels and without, in his own words, covering himself in
glory, his first interview was at Phoenix Assurance. Thirty years
later, he has achieved his career goal of becoming a chief executive,
having only had one more interview.