Shareholders in CGU and Norwich Union have until March 31 to give the
go-ahead to the creation of the UK's biggest life office.
The two insurers have launched a charm offensive to sway shareholder
opinion in favour of the proposed deal.
If they succeed, it will be the responsibility of mild-mannered church
warden Richard Harvey to ease CGNU into the aggressive waters of the
European insurance pond to compete with Continental big fish Axa, Allianz
Harvey, an actuary by training, joined NU in 1992 as chief executive of
its New Zealand arm. He returned to the UK in the following year as general
manager (finance) for NU and was appointed group chief executive in 1998.
The man, described by those around him as “likeable” and “open”, will have
to wait until June 2001 before he can take over from CGNU group chief
executive designate and current CGU chief executive Bob Scott when he
retires from the CGNU post. Until then, he will work alongside Scott as his
The 49-year-old father of three believes his “Antipodean management
style”, which he describes as an open and no-nonsense approach honed after
10 years of living and working in New Zealand, will stand him and CGNU in
good stead when he steps into the group chief executive role.
The Kiwi connection will remain an integral part of his life now that two
of his children have married and set up home in New Zealand.
He is also confident that the merger will give the combined group the critical mass to break into the European insurance market as the biggest UK-based life office operating in domestic markets on the Continent.
To emphasise this, Harvey resorts to a football analogy, despite squash
and skiing being his preferred sporting pursuits. He says: “You can only
play in Europe if you are in the Premier League, it is not something you
can really do from Division One. Until now, UK life offices have only had
the strength of Division One players.”
Harvey is almost apologetic and self-effacing when talking about himself
and his outside interests – he describes his skiing as “incompetence goaded
on by enthusiasm” – making it hard to imagine him ever blowing his own
But get him on to the subject of the merger and his whole demeanour
changes to that of an indulgent parent crowing over a child prodigy.
Like all parents, Harvey cannot abide having his baby criticised,
irrespective of the source of the criticism.
He dismisses analysts' predictions that one of the European heavyweights
could enter the fray and scupper the merger plans. “It is very unlikely
that will happen. That was just a headline-grabbing thought on the part of
the media,” says Harvey.
The church warden's faith stretches beyond conventional boundaries to
include shareholders' ability to focus on the job in hand. “UK shareholders
have concentrated on the deal itself, not media speculation, and I am
confident they will give the deal a warm reception,” he says.
Harvey also takes exception to analysts predicting that IFA business for
the combined group will not hit CGNU's projected figure of 76 per cent of
total group business.
But IFAs themselves back up analysts' assertions and have been vocal in
airing their concerns about the spate of mergers, in particular, the CGU
and NU deal.
Worried IFAs say they will be uncomfortable doing the same amount of
business with the combined group as they have with the two life offices and
will be inclined to split the business among other groups. IFAs account for
87 per cent of NU's life business.
Harvey defends the merger in the manner of an indignant and somewhat
disappointed parent. He says: “I am surprised IFAs would say that. They
have always done a good job in recommending the best products and we have
no plans to reduce the range of products on offer. Our market share will be
no greater than that of Standard Life or the Pru, so I do not understand
where they are coming from.”
He is keen to stress that IFA fears over the impact the merger will have
on administration are unfounded and that they can take solace from the
efforts that the group is making to maintain present service levels.
“I will crawl over broken glass to ensure we maintain our quality of
service,” he says, delivering the line with a tone of sincerity that makes
it difficult not to believe him.
But perhaps his sincer ity and gentle authority owe more to his church and
youth group activities than life as an actuary.
He sits on the fund-raising committee of the Children's Society and admits
he regrets not having the time now to be a youth group leader as he has
been in the past.
Self-deprecating to the last, he chips in that he is prob ably a bit “over
the hill” to join in now, anyway.