Why did former golden boy Bernard Mageean leave QBE?

In a small room at a private members’ club tucked away near Bank station, new property chief Bernard Mageean had called together a room full of eagerly listening journalists, and told them: “I’m aiming to make QBE a top UK property player.”

QBE certainly believed him, having paid good money to lure him from his role as property head at RSA.

An ebullient John Neal, then chief operating officer, declared proudly that Mageean would help the property division go "from strength to strength". Mageean's big ambition was to become a top five player.

Just two years later, Mageean is out the door. There were no farewell statements or nods to his contribution.

His departure was buried away coldly in a press release issued this morning by the QBE communications machine, along with yet another restructure.

This begs the quesiton: what happened to QBE’s one time golden boy?

QBE is remaining tight-lipped, giving nothing away.

Too little, too late

So scratching the surface, let's look at the possibilites. The first and most obvious is that perhaps Mageean didn’t grow QBE quickly enough for his Australian bosses.

Mageean last week told Insurance Times that he believed QBE was now in the top 10 of UK propety insurers, with UK property income around £150m and a 95% combined operating ratio.

Yet those figures were clearly some way off a "top five" spot that Mageean wanted. The Australian insurer is known for being aggressive in its pricing strategy, pleasing many brokers yearning for cheap deals to appease their hard-pressed clients.

For that kind of strategy, QBE would have wanted to see stellar results. Perhaps QBE felt he just didn't deliver.

Evergreen failure

Then there was the whole issue of Evergreen.

Evergreen was very much Mageean’s project. It was meant to be a big driver in helping propel QBE’s growth in UK SME. QBE snapped it up in December last year, but just three months later co-founder Michael Starkey left.

A string of staff followed, before QBE eventually threw in the towel by dumping the brand, scaling back the business and rolling the remaining premium into QBE.

The damage to QBE’s image in the UK SME market must have surely irked the top bosses.

Poor fit

Finally, you have to wonder whether Mageean ever fitted in at QBE.

RSA is very much the top dog in UK property, boasting by far the biggest commercial property book. To some extent, it already has in place the relationships, the reputation and the clout.

But QBE is a younger and hungrier enterprise that needs to grow. That means searching out new broker relationships, offering enticing deals and building up its image.

The two companies couldn’t be any more different and perhaps QBE just wasn’t quite right for Mageean.

Brutal cuts

One thing that is for certain is that QBE’s bosses have shown a ruthless side.

QBE chief executive Frank O’Halloran and UK chief executive Steve Burns are both affable individuals and big personalities. But they’ve shown they’re not afraid to make big decisions in the interest of the company.

Mageean was a big name whose arrival came with much fanfare and ambition only two years ago. Now he’s heading for the door.

The message to all QBE staff is clear: no one is safe.

Click here to read our interview with Bernard Mageean from 2008.