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For some years I have insured a small West Country pheasant shoot with the National Farmers Union (NFU), but I had no idea that they insured anything apart from shoots, farms and herds of cows. Every year I pay the premium by cheque and the service is excellent. The shoot once had a claim that might have appeared dubious: someone had shot down an overhead cable and BT sent a bill for £700 — promptly settled by the NFU.
At my wits’ end with a ragbag of online insurers, supermarket spivs and banks desperate to squeeze every last penny from me, I rang the Wareham branch of the NFU. A real person answered the phone: no queuing, no music, just somebody knowledgeable on the end of the line. Yes, they did all sorts of other insurance and yes, they’d be delighted to insure a house in London and a car too — in fact, more or less anything. The car insurance was a third less than the previous insurer and the house insurance better than half-price for a superior policy. That was three years ago and things have got better ever since.
This year, NFU Mutual celebrates its centenary and I can’t praise them enough. Originally set up to insure farmers through local networks, they now have 330 agents with good local knowledge, who bring in most of their £1 billion-plus annual turnover on the insurance side.
And they’re expanding — a strategy plotted by chief executive Lindsay Sinclair, the first senior outside appointment that NFU has made. Normally, promotion came from within and executives who’d spent years in the field (and farmyard) were the ones who took over the top job. But New Zealander Sinclair was, until 2008, the boss of the internet banking arm of the Dutch financial giant ING, and perhaps he brings a more modern approach to the mutual. But he’s not one for following the herd.
Where other insurers merge to slash costs and open ever-larger call centres in far-flung lands, the NFU is opening more regional offices where you can talk to real people over a cup of tea. Old-fashioned, perhaps, but it’s a formula that works and the squires in the shires love it. It reminds me of high-street banks 20 years ago, before they slashed the branch networks and went on the reckless spree from which Johnny Taxpayer has had to rescue them.
So how do NFU do it? Being one of the few remaining mutuals, they plough profit back into the business and pass it on by way of discounts to members. To qualify you must have been a member for more than five years: the discount is usually 10 per cent but in this, its centenary year, the NFU is upping it to 20 per cent. Not surprisingly they also engender terrific loyalty among their members, thereby not having to spend a fortune on advertising to pull in new punters; 95 per cent of policyholders renew each year.
The danger for the NFU will be greed. The 1990s saw wave after wave of ‘carpetbagger’ investors plotting — and very often succeeding in — attempts to force mutually owned businesses to demutualise. Building societies that went that way have either gone bust or been swallowed by competitors. The NFU says it is ‘totally committed to remaining a mutual’. I do hope so.
Oh, and another thing. This year the motor premium seemed to increase rather dramatically for no good reason, so I rang and asked why. Yes, they said, they’d look into it: three days later they came back with a rebate of £50.
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