As part of a new multi-role retained campaign with Pool Re, James Dobbin, Director and Head of Practice - Financial & Professional Services, spoke with their Chief Finance and Operations Officer.
Tell us a bit about your background
I am the Chief Finance and Operations Officer at Pool Re.
I am now actually the longest-serving member of staff at Pool Re and have been here for 13 years.
I am a chartered accountant, before joining Pool Re I had a number of roles, none of which were in insurance, I kind of fell into the role here.
My main role here is primarily that of being a CFO, but one of the things I like about it here is that it is a fairly small business so we tend to have quite broad base roles so there are a number of areas of the operations of the business that I am responsible for alongside my core of finance.
What led you to Pool Re?
It was really just rather random to be honest, a recruitment agent phoned me up and it interested me as a role, I hadn’t heard of Pool Re and I hadn’t worked previously in insurance or reinsurance.
But Pool Re is a unique business as we only have one line of business.
We re-insure UK commercial property against terrorism damage.
We have an odd governance structure. We are an insurance industry mutual so we don’t have shareholders, but we are owned by the insurance companies that pass business to us and we have a close relationship with government because we have an unlimited line of funding from the government in the event that we pay out claims and exhaust our own reserves.
All of this means that Pool Re is rather different from a run-of-the-mill insurance business and that interested me when I interviewed for the role and 13 years later it still interests me now.
Can you tell us about the business structure at Pool Re and some of the interesting projects you have worked on during your time here?
Pool Re is, in headcount terms, the smallest place that I have worked in my career, one of the things that from a finance perspective I like is that we deal with an important role within the insurance industry of dealing with what could be catastrophically large terrorism claims, but we do that with a small group of people.
We currently have about 35 employees but we are dealing with very large numbers. Our investment fund is around £6.5billion at the moment.
We have a premium that is ceded to us by insurance businesses through our re-insurance relationships of close to £300million a year.
So, we are a small group of people dealing with an issue that the insurance industry can’t really manage itself.
Companies like risks that they can model and understand and terrorism is very difficult to model.
The regulators don’t want the companies to keep terrorism risk on their balance sheet because of its unpredictable nature.
So, we take the rather toxic nature of terrorism property damage and we invest the premium that we receive so we are able to pay out the claims as and when we have to and we have a relationship with the government which means they will provide as much funding as required.
This means that Pool Re is a strange bridge between the commercial role of insurance and the more public role of government.
I think we represent an exemplar of public-private partnership, enabling commercial insurance companies to provide fully comprehensive cover for property and taking the risk off their balance sheets and proving them with a guaranteed line of funding in the event of claims.
Can you describe the culture at Pool Re?
Culture is an interesting one, Pool Re is to some extent like a small business and to some extent like a big business, as we deal with large sums of money.
Although our profile is relatively low, people who know about commercial property insurance or know about resilience will understand Pool Re’s role. It feels like we punch above our weight in business, especially when you think we are just 35 people across one floor of an office in central London.
The culture is hopefully the best of both worlds.
The office is largely open plan, we have an organisation chart but it doesn’t feel like an organisation where you are constantly aware of what your role is in an organisation chart and it is this ability to work beyond individual roles and functions which appeals to a lot of people.
Can you tell us about the new multi-role mandate that Procurement Heads has just taken on with you?
Yes, and this feels like a real step forward.
We are relatively small, when I joined, we were probably only about 15 people.
That has grown to 35 now, at the moment we have new challenges and we have always provided this bridge between the private insurance market and government but that is now a role that we are taking one step further.
We have an official classification as an arm’s length body of government and earlier this year we signed a framework agreement with our department in government which is HM Treasury and we are working out how to navigate our way to being the best body we can be while still keeping the commerciality which runs through our DNA.
When we look through what is on our strategic agenda, the scope of works is an interesting challenge and it is going to develop the offer that Pool Re has to insurance businesses quite considerably.
To achieve everything that is in the scope of works we have skilled individuals with technical expertise in particular areas.
We are at an interesting point in the development of Pool Re, Pool Re is an arm’s length body of government and we rely on the unlimited funding guarantee that we have from HM Treasury and we have a framework agreement that was agreed between ourselves and treasury earlier this year.
What this means is that in certain areas of our business we are going to have to up our game in terms of how we organise and manage our business and how we structure ourselves and one particular area is around procurement and PCR Regulations.
Up until now, Pool Re hasn’t applied PCR Regulations to our procurement.
When we think about contract management skills and commercial services it has very much been left to individual members of the executive team to run relationships between Pool Re and third parties that we contract.
When I think about PCR on one hand it fills me with concern as it takes us to areas we haven’t been before and it will become a challenge for us to adopt PCR regulations over a short amount of time.
We are working with a consultancy to make sure we manage the transition as effectively as possible.
As I have learnt more about commercial regulations, I have become more aware that there is a real benefit to Pool Re, up to now we have been an organisation that contracts with their parties and runs those relationships largely on an individual-by-individual basis.
To be honest this has worked effectively but it does mean we don’t have the rigour and structure around the management of contracts. I think the move to us coming into the world of PCR and procurement is a great opportunity for us to build a broader commercial services function to allow us to build on and manage third-party relationships.
What skillsets are you looking for in these roles?
We want the best of all worlds; we want to bring people in who have skillsets that we don’t have in our business at the moment.
We don’t have first-hand experience in procurement exercises and I don’t believe we have great skillsets in terms of managing relationships with third-party suppliers.
We want people who can hit the ground running and have the tools based on first-hand experience of running and transitioning to PCR in what can be a very different business to Pool Re.
To be effective I think in this role you both need the technical background but also to buy into the fact that Pool Re has benefits that we have gained from a commercial and maybe even an entrepreneurial approach that we don’t want to kill by better and smarter regulation of procurement and contract management.
It is this mixture of technical ability and commerciality alongside.
What is your office policy?
Our offices are in central London, above Monument tube station.
We can see London Bridge and the Shard from the window!
Before the pandemic people were pretty much office-based.
Coming out of the pandemic we have adopted a hybrid working approach and think we have done this in a way that works for the business.
Although our general pattern is three days in the office, how that is applied is something that we don’t dictate from the top but we enable each function to work out a pattern of work that works for them.
Are there any specific qualifications people applying might need for this role?
I don’t think it is really a case of qualifications, it is more experience and from our perspective, we want people who are technically proficient and people who have worked in a range of businesses where procurement rules have been applied or businesses with a wide range of services.
From Pool Re’s perspective, we have one large purchase which is a retrocession programme, retrocession being effectively re-insurance of reinsurance.
But apart from that our contracts that we will have to consider under PCR rules cover a broad range of activities from IT suppliers through to professional services.
There is a large piece of our business that relates to the investment function. There are certain exemptions in terms of PCR rules but we have custodian relationships and investment consultants.
Then in other areas, we have legal services we buy in, technical and research contracts
So it is an individual who has an understanding of different procurement relationships in business that is really going to help us get this function up and running.
If, along the way, individuals have taken on relevant qualifications that is something that we would certainly value but it is first hand experience that is most important for us.
Why would someone want to join Pool Re? What makes you different?
As I have already explained Pool RE has this strange governance background, we have a close link with government and without meaning to sound pompous about this it does mean that I think people feel like there is a real purpose to what we do.
I want Pool Re to be operating as smartly as possible but ultimately, we exist to fill a need in the insurance market that the insurance market cannot fulfil itself.
That is first-class insurance against damage to property caused by acts of terrorism.
That may seem a strange field to work in and it probably is!
I think we do sense that we have the ability to shape how that is provided and to do that in a way that we think is in the best interest of the insurance companies that pass business to us but also their policyholder and to do this in a way that worked for both government and the financial regulators.
When you think about the role that Pool Re provides it gets you out of bed in the morning feeling like you are doing something worthwhile.
I think that allied to a culture that is very open and relaxed but professional means that this is an interesting and purpose-driven environment to work in.