Interview: Martin Oliver, Barbon

“We are not a consolidator,” replies a half-smiling Martin Oliver, when asked if he wants Barbon to become the next broking giant. “We are a specialist. And there’re probably not enough specialist brokers out there for us ever to be a Towergate.”

It’s a measure of how far Barbon has come under its chief executive that people even mention the word ‘consolidator’. It was a different story in mid-2008 when the banks salvaged the insurance arm from the wreckage of self-styled one-stop property shop Erinaceous. Oliver, who has a solid broking background, was helicoptered in to sort out the mess.

Fast-forward to the present day, and Barbon is in rude health, and on the verge of announcing another year of solid results. At a time when peers are struggling to grow, Oliver reckons earnings before interest, tax, depreciation and amortisation (EBITDA) at Barbon will have risen from £13m in 2009 to £15m last year, with total turnover growing by 2% to £50m. In 2011, he believes the firm can add another 10% to earnings, taking EBITDA to £16.5m.

So what’s the secret? It’s a case of sticking to the basics and working hard, Oliver explains. “Property is what we’re good at – commercial and residential,” he says. “That’s what we do, and we do it well. Customers stick with us, and we have strong retention rates. We build on it and complement it.”

Nothing personal

Oliver, with his curly mop of hair, colourful shirts and fast-talking Northumbrian accent, is one of the insurance industry’s most distinctive characters. But it’s his achievements in broking that have really caught the eye. Aviva director of trading Phil Bayles explains: “He did a great job at Kwik-Fit, which was a personal lines broker. He got it to work. He picked up a bit of a hospital pass in Erinaceous, but rebranded it to Barbon and turned it around.

“He’s learned that commercial is different from personal lines, but borrowed some of that expertise. He’s a nice guy to deal with, and a credible guy.”

It hasn’t all been sweetness and light, though. Oliver admits he found making the switch from personal lines at Kwik-Fit to commercial business at Barbon to be a “steep learning curve”.

As ever, the banks have also presented a challenge – Barbon is majority-owned by a holding company called Caley Ltd, a consortium of banks.

With all the pressures they are facing at the moment, you might have thought the likes of HSBC and Lloyds had better things to do than to keep a close eye on Barbon. Oliver quickly straightens the record on that one, insisting that the banks have set strict goals for the company: “The targets are to grow our top line and bottom line. As I said to them the other day:

‘I don’t think there are many other chief executives of insurance broking companies that are getting targets like that’. They’re not easy taskmasters.”

It seems, though, that Oliver has the experience to meet these challenges. He started his insurance career in the early 1990s as a management consultant at Britannia Life, but within four years his talents were spotted and Kwik-Fit recruited him as finance director to set up an intermediary arm.

In 1995, with the internet barely out of nappies, telemarketing was seen as the route to market. “In early days, we spent a lot of money on advertising – nearly £5m in three or four months. The calls came in while the adverts were on telly, but as soon as we pulled them, it just went dead.”

The sudden drying up of customers was a shock to Oliver, but the Kwik-Fit team put their heads together and decided telemarketing was the answer. “I still get goosebumps thinking about launch day. We had a massive TV screen in the call centre and we were running adverts at the time. We would show the adverts on the massive screen, and we had a wall board with all the calls, and you would just see the calls surging,” remembers Oliver.

But no sooner had the business taken off again, insurers starting getting cold feet. Oliver recalls: “But for the support of people like Norwich Union [now Aviva] and Fortis [now Ageas] providing products, I’m not sure the company would be here today.”

With typical candour, Oliver admits that once Kwik-Fit’s private equity owners turned off the tap for acquisitions, boredom began to set in and he had no doubts about moving to Barbon.

But he has fond memories of his time at Kwik-Fit, and believes that Ageas, which bought it in July last year, has bagged a bargain. “The £215m price is great for what I still think is a great, great business,” he says.

Barbon, too, is on the prowl for an acquisition, with its own war chest. The remit of new acquisitions director Nick Sharp is to find a broker with a large property book – one with a value of between £5m and £15m would be ideal.

“It’s a bit like looking for a needle in a haystack. You’re not going to find it unless you put some effort into it,” Oliver says.

There was speculation at the end of last year that Barbon was at the top of Australian giant Wesfarmers’ shopping list, but Oliver dismisses any talk of a takeover: “It’s not a great time to sell a business, so there’s no rush. You’re looking to build a track record of success - explain to someone what it is you’re doing and they might like us.”

The price of success

But building a track record, and keeping up with all the different parts of a business has a heavy cost. A typical week for Oliver begins with an early morning flight from Glasgow, where the father of two lives, to England and then onto one of the firm’s regional offices. Working days can easily stretch beyond 12 hours. There isn’t even much time to watch his beloved Newcastle FC in action.

But Oliver, sipping a coffee after his 7.30am arrival for the Insurance Times interview, says his passion for work keeps him going. “There’s a hell of a lot of travel in the job and you do need energy,” he says. “It’s the not the money that motivates you. If you enjoy what you do, the money will follow. I don’t think you should try to do it the other way – try to chase money for something that you don’t enjoy doing.”

So what’s left for Oliver to achieve in his career? He thinks for a few seconds, before saying: “Perhaps something on the insurer side.”

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