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The changing world of ICA leadership

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The decision by Insurance Council of Australia (ICA) CEO Rob Whelan to step aside after nearly 10 years in the role presents the organisation’s board with some interesting possibilities.

Past selections of chief executives have, as much as anything, reflected the personalities and dynamics of the ICA board. Let’s look at a few of these appointments.

In 1991, the board appointed a former ICA chairman, Peter Daly, as CEO. The insurance company he ran had recently been merged with another, so the council ended up with a very smart, outgoing and charming man who also knew the industry and the council inside-out.

Daly was already close to his directors, so he could focus with confidence on building strategic relationships with key public servants and federal ministers. That helped the industry work its way through the beginnings of the age of consumerism. Among a list of achievements he formed and nurtured the industry-funded Insurance Enquiries and Complaints — later to become the Insurance Ombudsman Service and now part of the Australian Financial Complaints Authority.

It was the beginning of the modern ICA. Daly was succeeded by his deputy, Alan Mason, who had been the driving force behind the first General Insurance Code of Practice. Another former senior industry executive who had also worked with Daly for many years, Mason led the industry through the collapse of HIH and the government entanglements that followed with considerable panache. He also continued the effort to build an image of the industry as fair-minded and responsive.

But it was inevitable that the directors would eventually want to reach out and change things by hiring an “outsider”, so they replaced Mason in 2006 with Kerrie Kelly, who was at the time CEO of the Financial Planning Association.

Whether she was instructed to clean the place out or just took it upon herself to do so, in the minds of many Kelly threw out the baby with the bathwater, firing managers who had vital skills and experience and replacing them, in some cases, with lesser people.

However, she also recruited some new types of key specialists — like Head of Risk & Operations Karl Sullivan — to strengthen ICA’s technical abilities. It’s hard to judge Kelly’s overall effectiveness, because she was gone in just three years. She was poached by the Association of British Insurers, where she lasted five months before resigning, apparently over a disputed reorganisation plan.

A replacement for Kelly at ICA had to be found, and quickly. It may be a measure of the urgency involved that the two board members charged with finding a new CEO selected Rob Whelan and offered him the job before they told the board.

Whelan was plucked out of Suncorp where he managed corporate affairs and policy functions in some of the group’s insurance businesses. Whether the directors involved wanted a less controversial CEO or just one who would calm things down is difficult to gauge.

Nine months after taking up the job, Whelan had his baptism of fire with the 2011 Brisbane floods. Unprepared and badly supported, his representation of the industry in the media storm that inevitably followed was woeful.

Compare Whelan’s television news non-performances in 2011 with his calm and reassuring appearance before the Hayne royal commission in 2018, and you get some idea of how Whelan has developed, and how ICA has developed around him.

He successfully managed the drive for flood mapping — once thought impossible — forged closer co-operation with governments and built a strong response strategy for catastrophes. ICA’s technical capabilities have been considerably enhanced over the past 10 years.

While the council’s public profile is still low, at least the body is recognised. But in the 2020s, is that enough? Whelan’s low-key personal approach suits him, but such an approach needs to be considered in the context of today.

This ICA board is younger and more ambitious than the board that recruited Whelan. It wants its representative body to reflect insurers’ desire to get closer to their customers, to be friendlier, more responsive and reliable.

The ability to use technical expertise to achieve change is important, but increasingly important is the ability of a leader to project the industry as thoroughly modern, confident, consumer-friendly and a vital link in Australia’s social security.

Whoever that person is, they will also need the ability to work with an increasingly powerful consumer lobby while confronting unfair criticism, and deal with governments in pretty much the same way. All that while understanding the deep complexities of this industry.

Good luck with finding that person.