“We are presented now with a set of consequences that doing the right thing becomes extremely difficult to deliver,” says John Pollock. He is talking, of course, about the sweeping set of reforms introduced in the Budget.
And Pollock is convinced, despite consistently falling public opinion, that the insurance industry does want to do the ”right thing” for customers and, further, that it is a “force for good in society”.
Speaking to Money Marketing as he prepares to retire after 35 years at Legal & General, he says: “The amount of good the industry does is so poorly recognised that I lament it. If I could leave a legacy, wave a magic wand, it would be for people to recognise how much good there is in the industry.
“We’ve been weak as an industry at standing up and demonstrating what we do. I asked someone what percentage of our life claims we pay. They said 5 per cent. I couldn’t believe it: we pay 98.8 per cent of life claims.”
However unrealistic leaving a legacy where insurance companies are celebrated for their good deeds seemed before the Budget, the chances of Pollock’s dream becoming reality went a lot longer after the Chancellor stood up in March.
“The fact is we were given hardly any time and then expected to deliver a satisfactory solution,” he says.
“If we were given 20 years’ notice of the pension changes we would have put time, effort and energy into educating and informing consumers so that when they get close to retirement they’ve got a sense of the kind of options that might be available to them,” he says.
“It’s one thing to change policies that are renewable – like car insurance, home or even life insurance – but your income post-retirement is pretty much decided as and when you retire. It’s a dangerous thing for policymakers to underestimate the critical nature of those choices.”
According to Pollock, the financial services industry has never gone through “a period of more intense change”, which begs the question: why leave now, when the challenge is only just beginning?
He will not be drawn into the why and wherefores beyond saying it is “the right time for me”.
While many run as fast as possible towards the promised land of retirement, Pollock seems hesitant and genuinely sad. Perhaps this is because he is a company man, having spent his entire career at L&G and its fortress-like head offices in Kingswood, Surrey.
He would have worked on oil rigs in the North Sea analysing samples of mud for a living but when he graduated from Strathclyde University with a degree in geology and geography it was 1979 and the middle of a periodic oil recession.
Computers were just taking off and so Pollock applied for and got offers as a trainee programmer at Ford, HFC Bank and L&G. He chose L&G, he says, because “it had the nicest location with the best sports facilities”.
Thirty-five years later and after stints in the insurer’s IT, operations and distributions departments as well as a short spell heading L&G Asia before the 1997 economic crisis killed off the business, he has ended up as executive director and chief executive of L&G Assurance Society, the group’s protection and savings business.
He is clearly extremely proud of L&G – his office is packed with insurance memorabilia, including a turn-over-the-century sign from a L&G subsidiary’s former office in Mumbai – but he is clearly irked by the perception of “man and boy” employees in an era where they are a dying breed.
“I’m very fortunate that I’ve been able to do all those roles with one company, which is unusual in this day and age. There are some that say people at one company their whole life have no imagination, desire or ambition but that’s just nonsense. I’m quite proud of what we’ve achieved over my time and I think we’ve led the market in a number of ways.”
Pollock is going back to his IT roots during his remaining time at the firm. He says much of his last 18 months has been spent helping prepare the insurer for “the next transformation to come” – the use of technology in serving customers’ financial needs.
He would not be pushed on how much L&G has invested in digital but does say expenditure on legacy system has been halved.
“This is about the importance of IT to business models that are transforming away from legacy expenditure on product administration systems being replaced with customer-centric digital systems,” he says.
Pollock also sits on the FCA’s practitioner panel as deputy chair. He says one of his last efforts will be to try and “make regulators understand unintended consequences and regulate accordingly”.
He says the regulator’s eagerness to protect consumers has actually sometimes been to their detriment as firms withdraw service and products in fear of regulations coming back to bite them.
“Interest-only mortgages, for example, are now very hard to get because the mere attention of the regulator and the threat of both claims management companies and the Financial Ombudsman Service overturning decisions means you will find it very difficult to find one,” he says.
“That comes from the environment we have created, wishing to award compensation to individuals. The result is society no longer has access to those products. Only time will tell whether that’s been a good or a bad thing for UK society.”
2014 – present:
Deputy chair, practitioner panel,
Legal & General Group
Life insurance committee,
Association of British Insurers
Chief executive, protection and annuities,
Legal & General Group
Executive director product and corporate,
Legal & General Group
Legal & General Assurance Society
Legal & General Asia
Various IT, operations, sales management roles,
Legal & General
What’s the best bit of advice you’ve received in your career?
If you leave a company at the moment of your choosing with your dignity in tack, you have had a good career.
What keeps you awake at night?
What is the most significant impact on financial advice in the past year?
The Budget bombshell.
If I was in charge of the FCA for a day I would…
Recognise our responsibility to financial security for society. I do not believe politicians want them to be a consumer protection body.
Any advice for new advisers?
Be professional. It is about the customer; not about you.