Aviva Case Study

408-034-1
Leadership, Culture Change

and Transformation at AVIVA
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This case was written by Anne-Marie Cagna-Carrick, Research Associate, under the supervision of Charles Galunic,
Professor of Organisational Behaviour and the Aviva Professor of Leadership and Responsibility, both at INSEAD. It is
intended to be used as a basis for class discussion rather than to illustrate either effective or ineffective handling of
an administrative situation.
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“To be a service provider, with insurance at our core and care at our heart.”
The audience’s reaction was silence as the executive team of Norwich Union stood on the
stage before them and announced the organisation’s new philosophy at the Five Lakes
conference in March 2001. The audience, mostly directors, were quite simply astounded by
the declaration. How could the executive team be so out of touch with what was actually
going on in the company? When Patrick Snowball, CEO, irritably asked why no one had any
questions, one person bravely stood up and said, “But we don’t understand where this has
come from.” He was told, in Patrick’s charismatic way, to sit down and shut up.
The executive team left the conference confused and deflated. How could they have gauged
the situation so badly? Were they really so disconnected from the rest of the organisation?
The core message of the new philosophy – ‘care’– was a shock, given the recent focus on
efficiency; the build-up and communication were clearly lacking. It was true that since the

merger in February 2000 between CGU Plc and Norwich Union, they had focused on making

the business profitable, as any executive team would have done. But why should this have
made reworking the culture so difficult? Why couldn’t the troops appreciate and grasp this
new tag-line and get busy making it work? And what could be done now?
There was worse news. Results from a recent Cultural Survey 1 had also been shared with the
audience just prior to the new strategy philosophy. The survey portrayed a considerable gap
between the executive team and the troops. As one director present at the conference noted,
“On the graph they presented, it showed clearly the disconnection: where we were and where
they were. We were miles apart.” The results had been published only a couple of days before
the conference. The executive team was clearly unhappy with its conclusions and felt angry –
how could there be such a wide disparity? “It was a tirade of ‘Why the hell aren’t you lot in
touch? Just pull your socks up!’ – and then they presented the new ‘caring’ philosophy. It was
too much,” noted one of the conference participants.
Background: A Series of Mergers

Following a leak to the press on 21 February 2000, two of the UK’s foremost insurance
companies CGU Plc (itself a combination of two companies: General Accident and
Commercial Union) and Norwich Union, announced a proposed merger, which would create
CGNU Plc (see Exhibit 1). The declaration was a surprise not only to the two companies’
personnel but also to industry experts. Recent attempts by large insurance companies to merge
had been regarded as failures. In addition, CGU Plc had only been created 18 months before
and the company was still struggling to fully integrate its operations.
CGU offered a broad range of life and general insurance products with a stronger global
presence than the UK-based Norwich Union. The merger was effective as of 30 May 2000.
CGNU became the world’s sixth-largest insurance group, the largest insurer in the UK and
one of the top five life companies in Europe. Its main activities were long-term savings, fund
management and general insurance. It had worldwide premium income and investment sales
1 Using the Dennison Survey methodology.

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of £27 billion and £220 billion in assets, employed 70,000 people, and had more than 15
million customers. 2
The two merging companies were very different:
Norwich Union
Norwich Union was founded in 1797 by Thomas Bignold, a 36-year-old wine merchant and
banker. He had been looking for a company that was willing to insure him against the threat
of highwaymen in Norwich – transporting money and wine apparently attracted thieves.
However, he soon recognised that the threat of fire was of greater concern, not only to him but
to the citizens of Norwich, a city constructed largely from wood. Recognising an opportunity,
he created the “Norwich Union Society for the Insurance of Houses, Stock and Merchandise

from Fire.” By 1808 Bignold had established a second mutual company, the Norwich Union

Life Insurance Society. The Fire Society was demutualised in 1823, when it acquired Norwich
General Assurance Company. The company operated its own fire brigade to protect society
policy holders whose buildings were identified by “fire marks”. 3 It was not until 1929 that the
Fire Society surrendered its last fire brigade (in Worcester) to the local authorities.
The company continued to develop over the years and expanded overseas, growing
organically and acquiring small companies. In 1997, the company celebrated its bicentenary
and “Norwich Union”, as it came to be known, demutualised and floated as a public company
on the London Stock Exchange, becoming a FTSE 100 company. The £2.4 billion raised in
the share offer was the largest British private sector flotation seen at the time. Although
Norwich Union was a composite insurer, it was listed on the markets as a life company. 4 In
fact, there was pressure at the time from analysts to shed the general insurance side of the
business. The following year, in 1998, Norwich Union purchased the UK general insurer
London and Edinburgh in a “fast-track” transaction.
Before the merger, Norwich Union general insurance had targeted mostly individual clients;
commercial or corporate clients were limited. Only eight service centres operated in the UK
because personal insurance was viewed as highly commoditised and so could be streamlined
and centrally controlled, without the need for many local branches.
CGU Plc
CGU Plc was formed in June 1998, following the merger of Commercial Union and General
Accident. On its creation, it had operations in over 60 countries and employed approximately
20,000 people in the UK and a further 32,000 overseas. Both CU and GA operated in a very
“local” fashion, with businesses managed autonomously by branch managers and little
2 CGNU Annual Report and Accounts, 2000.

3 A fire mark is an insignia, generally metal, that was placed by insurers on the buildings they covered. As the
insurers had their own fire brigades, they had to check the mark on a burning building to determine whether
or not they should extinguish the fire.
4 A composite insurer deals with both life insurance and general insurance. This was the common model
throughout the industry until the end of the 20th century, when specialising in one or the other was
considered a more efficient model.
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intervention from head office. The branches dealt with both personal and commercial
insurance; local underwriters were present to understand the local risks involved for
customers. Commercial insurance was the more prominent and was sold almost exclusively
through brokers, which required relationship building and interaction.
General Accident had its roots in the farming communities of Scotland. It was founded in
1885 as ‘The General Accident and Employers Liability Assurance Association’ by a group of
local businessmen. In 1897, Norwich Union tried but failed to take over General Accident,
leaving the two companies separate entities for another 100 years. Both firms had grown
down the years by acquiring small companies and expanding internationally. Included in these
takeovers was the acquisition by General Accident of Yorkshire Insurance Co. in 1967, which
established strong links with the city of York.
Commercial Union was founded further south. A fire in 1861 in a London hemp warehouse

that lasted two days caused great concern among the insurance companies at the time. The

insurers duly announced increases in premiums for waterside warehouses. The merchants, in
response, called a public protest meeting and formed a committee to consider how they could
make their opposition most effective. Three insurers took advantage of the committee’s offer
of consultation, and on 5 August 1861 it was decided to create a new company, the
Commercial Union Fire Insurance Company. The company developed rapidly and by
December of the same year had already branched out to Germany.

At the time of the merger, CGU had some 88 branches in the UK alone. The merger of CU
and GA would continue the tradition of a people-focused organisation, a tradition promoted
by the HR director of CU at the time. In the words of one respondent, “He was a visionary
and forward-thinking in his desire to create an organisation that was people-focused.” Cultural
integration had begun in 1996 throughout CU. Two main orientations underpinned the
organisation’s culture:
• Best place to work – at the time, this was a novel concept
• Market orientation – concentrating on particular market sectors.
When the merger was announced, a huge effort was placed on creating and getting buy-in to a
clear vision and strategy for the new organisation, and on “bringing all the employees together
properly” with integration driven locally between the CU and the GA staff. People were
brought together in the branches to discuss what they valued and how they saw themselves in
the new structure. Most important of all, the selection process had to be a fair one. To achieve
this the management team embarked on a fairly time-consuming, yet robust, procedure.
1. First, an HR team from both CU and GA spent eight weeks at the branches to prepare the
staff for the actual selection process. They coached the staff in such things as interview
techniques, updating CVs, etc.
2. Once this was concluded, four weeks of interviews took place from morning till night.
3. The “wash-up” followed: after the hard toil of interviews and discernment, the HR people
would gather to rank the candidates. These rankings were posted and discussed by the
management team who, in turn, decided on the final list of retainees.
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4. Those who were not selected were made redundant. However, if there were insufficient
vacancies in a particular section for the number of people who had been chosen, these
staff members were offered a job elsewhere within the new organisation.
5. The management worked closely with the unions to ensure that the process was as
transparent as possible.
Operationally, translating the agreed strategy into action proved frustrating. As one employee
commented:
“We were running blind for 18 months because we were trying to bring data
together, but it was completely incompatible. When people tried to do this, a lot of
data were lost.”
GA and CU measurement systems targeted similar things but in different ways, with the result

that it was “almost impossible for them to work operationally together”. Although the staff

were now in common locations, GA and CU personnel were on different sides of the room
simply because of their knowledge of the different businesses. It was clear what needed to be
done, but product sets, systems and procedures were yet to be rationalised. In fact, this
reflected an historical tradition: operational issues were simply not emphasised, making it
difficult for Cathryn Riley, Operations Director, to achieve the necessary traction. This was
further compounded by tensions between her and her GA counterpart, with whom she had
joint accountability but a very different sense of urgency and drive. (See Exhibit 2 for a
timeline of the mergers).
CGNU Merger Process: Bang Them Together

It was in this context that Norwich Union and CGU merged to form CGNU Plc. Although
slated as a merger of equals, control fell disproportionately to the two entities. CGU would
drive the life insurance business out of the York offices (Norwich Union Life), while NU
focused on the general insurance business, based in Norwich (Norwich Union Insurance). To
simplify the brand, the overall company name would be just ‘Norwich Union’. 5
Norwich Union General Insurance (NUI) – The Poor Relation

The general insurance business was not profitable. NUI was a cyclical business with
substantial lags between risk/premium decisions and their payoff, and profitability was in the
order of “one in five years in the past.” Prime suspects for the profitability problems were:
• Poor feedback on risk/premium decisions (lag).
• Assessing the size of the risk, and pricing accordingly, was seldom 100% accurate. Staff
inevitably had to work on instinct. However, instinct takes time to build, and all the while
structures were changing, as well as the marketplace.
• A fiercely competitive market, in which undercutting was common.
5 CGNU group later became Aviva Plc but maintained the Norwich Union brand: Norwich Union Insurance
(NUI) and Norwich Union Life (NUL). Outside the UK, Aviva is the dominant brand.
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Worse still, NUI was regarded within the new group as a “second-class citizen” compared to
the Life Insurance business. When the new company was created, the group was even listed
on the FTSE under the code “Life Insurance”, even though it was a composite insurer. As one
manager noted:
“It was quite shocking to see how little regard there was for the General
Insurance business within the group. There were jokes made as to why anyone
would choose to work in NUI rather than Life.”
Another manager went further:
“On a group level, NUI was not seen to be the place to be. We were asking
ourselves was it worth it? Would they sell us off? How would they motivate us?
Would NUI be sold completely? Could the new company make money?”

The Life business, on the other hand, was booming; a contrast that made working at NUI all

the more difficult. Meanwhile, operational issues were still in disarray. “We were trying to
organise one merger on top of another – it was chaos,” noted John Ainley, who was put in
charge of NUI HR.
NUI Executive Team

Once the split between Life and General Insurance had been made, the priority was to put in
place the top teams. Politics were inevitable:
“There were all sorts of politics going on. In the immediate aftermath of the
merger, Mike Biggs was appointed CEO UK for GI with some other ex-CGU
people on the executive Board. He didn’t get involved in the day-to-day running of
the business but sorted out some of the financial issues. Patrick Snowball, who
had been CEO of NU, took over as Managing Director. Mike had only one direct
report, which was Patrick.”
Within six months, Patrick replaced Mike at the helm of NUI, and the top team quickly
consolidated, mostly consisting of former NU staff (see Exhibit 3). Cathryn Riley, valued for
her experience and drive, remained as Director of Operations and became the sole ex-CGU
person in the top team. As one director noted,
“When we started to see the appointments that were made, we knew quite quickly
that the company was going to adopt a Norwich Union philosophy to General
Insurance.”
Patrick also wanted people around him that he knew and trusted. An ex-military man, he
knew that some tough decisions needed to be taken to make the GI business profitable once
again, and once commitments were made there was no going back. Through sheer force of
character he instilled a fundamental belief that NUI could and would succeed. As one ex-
CGU employee noted:
“Patrick was inspirational with his commitment to make it work. His mindset was
‘We will make it work’. His determination was key.”
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Banging Them Together

Restoring fortunes meant dealing with difficult trade-offs, but Patrick did not shy away from
difficult decisions. As he explained:
“All I was interested in at the time was profit – I wasn’t interested in either the
level of service or morale. For example, I withdrew all underwriting authority and
for two years people bitched about it. We slowly put it back, and eventually about
96% of all risk could be underwritten back in the regional offices. When I became
comfortable that I could trust people not to do something stupid, they got the
money back.”
He and the team began to rationalise the business and narrowed the fields – he immediately
withdrew from large commercial markets in 2000, such as the Channel Tunnel, oil rigs, and

the London markets. Airlines were sold off the same year (paying a premium to exit), a

sensitive issue as CU personnel had been very proud of these particular businesses. But once
the strategic portfolio had been set, the management team was committed to seeing it through.
Patrick believed speed was essential. His analogy was that of running across the marsh: if you
go slowly you will get bogged down. This meant accepting that mistakes would be made
along the way which could be sorted out later, though hopefully getting a lot more right than
wrong.
Patrick made it clear from the start that if senior managers wanted to remain in the NUI
business they would have to relocate to Norwich, something even top management from
former Norwich Union days questioned. The rationale was cost and coordination, plus the
poor CGU experience (which had maintained different headquarters in Perth and London,
which was believed to have exacerbated the time and resource waste).
The wider context also informed the CGNU merger process. Indeed, the insurance industry
had been witness to several less-than-spectacular mergers: Royal and Sun Alliance, Guardian
Axa, Royal Exchange and CGU itself. Paralysis was a common symptom, recalled Mark
Hodges, NUI Finance Director. NUI wanted to avoid this paralysis, and here the ex-NU
modus operandi of fast action was the order of the day:
“We were nimble and sorted things out very quickly – in reality, we went into
takeover mode. Patrick and the team had quickly said ‘This is the way we’re
doing it – this is in and this is out.’”
Over the next two years the attitude was “Either get on board or think of doing something
else”. Of course, there were consequences, as Mark recalled:
“It’s better to be gaining momentum rather than arguing over every single
decision. That’s how it felt for us; it was our strategy that was being adopted and
our way of thinking. Our name was kept and I suspect if you were in CGU you felt
disenfranchised.”
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Fully Integrated Multi-Distribution Insurance Company

(FIMDIC)
“Our vision is to be a fully integrated, multi-distribution insurance company. Part
of our commitment to exceeding customer expectations is to provide our products
through a variety of distribution channels, whether via the internet, through a
bank or building society, or a high-street broker. At the same time, we are using
our strength, size and skills to deliver economies of scale and a sustained
competitive advantage. This will ensure that we continue to enhance the earnings
of CGNU.” 6
‘FIMDIC’ was NU-speak for a business that is fully integrated in vertical units. The FIMDIC
model was used extensively from the late 1990s until the early 2000s and encapsulated NU’s
belief in economies of scale and consistency of service: think insurance plant, not boutique.

This was, of course, the ex-NU approach; the ex-CGU model was more of a boutique, but

with questions about profitability.
During the integration process the company was trying to save £148 million. “We shed
between 4,000 and 5,000 people and completely reorganised the operation to this FIMDIC
model,” explained Mark. “We had 18 months to go through the integration process which was
‘slam it together’ and very much led from the top.” Consultation and engagement were
luxuries, and the prevailing belief was “Just get on and do it”, a catch-phrase popularised by
Patrick, and that spread through the company.
Speedy Selection Process

Selecting the staff that would remain in the new company was carried out quickly – in
complete contrast to that of the CGU merger. There were no lengthy HR visits to the locations
– and so no interviews or case analyses – and certainly no training offered to the staff. Much
of the work was carried out behind the scenes. Spreadsheets were drawn up listing employees’
names. Sometimes mistakes were made, for example, names that were left off the lists. The
HR process was primarily ex-NU led. “There was a primary pool that showed where the job
was going and how it was split based on the redundancy law. If there was no job for you it
was tough luck,” one manager explained. The focus was on speed and restoring profitability.
The entire selection process took four months, compared to the 18 months within CGU, and
with far fewer people involved.
Profits Return...but with Friction

Meanwhile, Cathryn Riley and Alastair Ham, Director of Integration at the time, continued
the work they had begun following the CGU merger. Learning the lessons from their recent
experience, they quickly established a clear operational strategy that would harness NU’s
ability to drive through change. Rather than mix cultures and systems, everything would be
built around one set of products and systems. The consumer side of the business would be
handled in ex-NU locations on ex-NU systems, while medium- and large-scale commercial
6 CGNU Annual Report and Accounts 2000.

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insurance would be run on ex-CGU systems in ex-CGU locations. The approach to small
commercial business was the most radical of all, with six new centres being built and staffed
in a period of months.
Financially the results were impressive, as Alastair noted: “We went way beyond what was
being asked of us. In fact we decided to achieve annual savings ten times greater than what
had been requested.” Profitability was turning around; no mean feat in a cut-throat industry.
Making it work was tough. Tension points did emerge. In one instance, growth was being
restored at the same time that consumer policies were being transferred from more than 50
CGU branches to just 10 NU locations. Making sure they had the right resources to deal with
it was no easy task, as Alastair explained:
“In operations, we physically didn’t have enough space for the numbers of people

needed to deal with the transfers and new business, yet setting up new locations

that would only add the cost back in was not an option.”
Not to be beaten, they resolved this by physically knocking down walls to create more space
in the existing offices.
Meanwhile, the timescale for setting up the new small business centres felt even tighter. The
goal they had set was to reduce centres from 60 to six, but with no clear model for how these
new hubs should operate, and with only six months in which to build them from scratch. Of
course, concerns were raised. The HR people complained that they would not be able to train
people in time, including underwriter skills. The IT department complained that it would be
impossible to set up the systems in time. Others complained that relationships with brokers
could be damaged and this would hurt the business. Furthermore, everyone, from top to
bottom, was putting in “crazy hours” to try and pull it off. In the end, and not without
listening to the arguments and appraising what was possible, Patrick and his team determined
that the reconstruction was possible. And in the new NUI an assumption was taking hold: if
you decide to do something, you see it through and complete what you started. Financial
results were improving. 7
Integrating the Personnel

In the longer run, integration required a greater integration of personnel. This would mean
dealing with more than just the disparity in branches (CGU had 88, NU had 8); it also meant
dealing with approaches and assumptions. It was often asked, or at least thought, “Which one
are you: CGU or NU?” A person’s former company was taken as the best indicator of how
they approached the business. As one director explained,
“Intuition would tell me that the CGU people thought the NU personnel were
gung-ho, aggressive, unthinking, unreflective. Whereas the NU staff would say ‘So
how long will you CGU people need to sit on the fence for?’”
7 More than half (57%) of CGNU’s general insurance business was written in the UK, operating profit was up
99% to £590 million. Source: CGNU Annual Review 2001, Leadership in financial services.
408-034-1
This was complicated by the fact that, while CGU was seen as more “family”, “employee-
focused” and “sensitive to individuals”, their integration efforts were proving less effective.
The prevailing logic was waging effective war against the logic of “streamlining and
efficiency”, as Patrick recalled:
“I went into one CGU office. The guy who ran the place had moved a huge
amount of CU work into a GA office where they had no knowledge of the product
and no technology to deal with it. In the office there were two rows of CU and
GA, and then there were these poor people in the middle called CGU. I asked the
manager what the backlog was and she showed me a pile that was so high it
towered above her.”
Privately, Patrick’s motivation to continue with the work needed stoking, not least through the
support of a business school professor. Not to be defeated, Patrick and his team continued

with the work, which meant thinking ahead, thinking strategically. While the fortunes of NUI

were being restored, they soon realised they needed a new “banner” to work under; one where
neither the CGU nor NU cultures were dominant. In other words, a fresh approach.
While NUI’s operational focus through 2000 and 2001 was on delivering the financial
benefits of the merger, Patrick set aside executive time to put in place a longer-term strategy
for the company. Given NUI’s standing in the wider group, he saw it as essential for NUI to
deliver more than just short-term financial success. In short, they needed a compelling
strategy for long-term success against the backdrop of a changing General Insurance market.
Mark Hodges, together with his NUI strategy team, drew on work begun just prior to the
merger to embark on a series of strategy “away days” with the executive team. Central to this
process was a series of scenario workshops that began to sketch out a new strategy that was
internally called “up-a-bit-left-a-bit”. This referred to the following 2-by-2 matrix:
The idea was to position NUI closer to customers, fulfilling more customised needs with a
thoughtful approach and greater attention to services, while leveraging its vast and
increasingly streamlined back office to offer value.
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By January 2001 the executive team members were ready to share their thinking with a
trusted group of direct reports and ask them as a group how to link this overarching direction
to action. This group – the “Coltishall 14” – (named after the place where they met) went
through a series of workshops, facilitated by the NUI strategy team, exploring the executives’
thinking and developing a series of wider engagement themes. This group proposed five
projects: customer solutions, customer value, commercial, mindset and behaviour, and market
leadership.
By March 2001, having heard the feedback from this group, the executive team was ready to
share its thinking at the senior management conference at Dunstan Hall near Norwich. As part
of the presentation, Mark Hodges asked for volunteers to work on the five strategic themes
developed by the Coltishall 14 over the summer – with each theme being led by a member of
the executive team and comprising five or six directors and “heads of” from across NUI.

The output of this work was to be shared with the executive team at a highly interactive

session in October 2001, and a month later at the senior management conference. On the back
of this work, the executive team began to describe the new NUI strategy in terms of a
philosophy statement: “To be a service provider, with insurance at our core and care at our
heart”. The executive felt ready to re-engage with the wider senior team – which they planned
to do at the senior management conference in November 2001 at the Five Lakes Hotel.
Convinced of the new philosophy, the team charged ahead.

Five Lakes Conference

By November 2001, the moment seemed right to launch the new philosophy to the rest of the
organisation. After all, the company was profitable and the integration process seemed to be
running smoothly. The directors and some heads of units gathered at the Five Lakes Hotel for
the company’s annual conference. One senior executive present at the conference summarised
the situation:
“It was doomed for disaster from the start. Physically, the space was badly set up
with trestle tables in lines across the room and a stage where the executive team
would sit. It would be impossible to get out without disturbing everyone along the
table. We were like trapped animals!”
The conference, in addition to being the platform for unveiling the new philosophy, was
significant for three other reasons. The results of the first Internal Morale Survey, post
merger, were shared with the group. The directors had expected poor results but were shocked
by what they read. “There was a silence that hung in the room,” one person noted, as the full
scale of the low morale became apparent. Second, the initial Broker Survey findings were
presented, with disturbing conclusions: “We came fifth out of five – it was damning.” Finally,
the results of a Cultural Survey were announced. Instigated by John Ainley, this consisted of a
series of questions that were sent to the executive team and the population immediately below
them – the directors. The questions concerned the organisation’s strategy and engagement,
and whether the staff “felt joined up” to what the executives were doing. It was clear that a
wide gap existed between top staff and the executive team. But perhaps most alarming of all
was the fact that the staff turnover rate in the organisation was increasing, approaching 30%,
with slumping commitment levels.
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“A Bad Joke?”
Brigit McIntyre, Director of Marketing and Underwriting, then took the stage with Mark
Hodges and presented the organisation’s new ‘care’ philosophy. One person present recalled:
“It was a shock and a surprise. The philosophy was put up as ‘This is it and you
have ten minutes to discuss and then we’ll have some feedback on how we are
going to care.’”
Reactions were unanimous: “You can’t possibly believe this”, “We don’t understand what this
is about”, “It’s nonsense”. At a regional level, people collapsed laughing when they heard the
new mission statement; they simply did not think the executive team was serious – it seemed
such a stark contrast to the merger process to date, and to the assumptions that were spreading
and penetrating the organisation.

The executive team left the conference baffled, angry and disheartened. Were they really so
disengaged from what was happening in the organisation? What about the success story that
was emerging? And why wasn’t the beauty of this next step evident to all?
Most of all, though, they were concerned with what to do next.

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Exhibit 1
Statement Announcing Formation of CGNU
CGNU to be included in the UK life assurance sector
26 May 2000
The FTSE Actuaries Committee have announced that from the effective date of the scheme of
arrangement of Norwich Union (the “effective date”), which will be the first day of trading for CGNU
shares, CGNU will be listed in the FTSE life assurance sector. The effective date is expected to be
Tuesday 30 May, 2000.
Bob Scott, Group Chief Executive designate of CGNU commented:
“I am delighted that CGNU’s emphasis on life business has been recognised by our inclusion in the
life sector. Our focus is on growing the long-term savings business aggressively and profitably. CGNU

will be one of the leading UK life businesses, and uniquely among major financial services companies

in the UK, we already have a strong portfolio of businesses elsewhere in Europe.
Considerable planning for the integration of our businesses has already taken place, and the integration
process will begin immediately.”
CGNU will be:
• the UK’s largest insurance group, with worldwide premium income and retail investment sales of
£26 billion
• the second largest writer of new life and pensions business in the UK with a diversified approach to
distribution incorporating IFAs, financial institutions, agents and direct
• a top-five European life insurer, based on premium income, with leading positions in the UK,
France, the Netherlands, Ireland and Poland, in addition to a strengthened presence in other
European markets
• a significant asset management business with in excess of £200 billion of assets under management
and the second largest UK-based fund manager by reference to funds under management
• the largest provider of general insurance in the UK with a focus on personal lines and small
commercial business
• a group with leading positions in a number of other general insurance markets
• a group committed to the development of innovative Internet and e-commerce applications across its
businesses.
Exhibit 2
Timeline of Mergers
1797 Norwich Union 1887 Attempted takeover 1908 Acquisition of 1957 Acquisition 1998 Takeover 2000 Norwich
founded of Norwich London of Scottish London and Union and CGU
General Accident Accident Insurance National Edinburgh PLc Merged
Insurance
Norwich Union
1998
1885 1887 NU 1967 Takeover of 1996 Acquired Commercial
General Attempted Yorkshire Provident Union and
Accident takeover of GA Insurance Mutual General CGNU
founded Accident
merged
General Accident
1907 Scottish County & 1918 Bought 1959 Merged with North 1973 1990 CGU Plc
Mercantile Insurance Edinburgh Life British & Mercantile Acquired Acquired
1696 Commercial Group Insurance Company Insurance Company Delta Morley
Union founded Lloyd
Commercial Union
408-034-1
Exhibit 3
NUI Post-Merger Executive Structure
Patrick Snowball
CEO
Cathryn Riley* Ken Wallace Brian Jenkins Simon Machell Bridget Mark Hodges Alex John Ainley
Operations Brokers Retail Claims for all McIntyre Finance Robinson HR
channels Marketing and IT
Underwriting
* ex-CGU
408-034-1

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Leadership, Culture Change

Norwich Union Insurance

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Background: A Series of Mergers

1 Using the Dennison Survey methodology.

The two merging companies were very different:

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2 CGNU Annual Report and Accounts, 2000.

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December of the same year had already branched out to Germany.

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timeline of the mergers).

CGNU Merger Process: Bang Them Together

Norwich Union General Insurance (NUI) – The Poor Relation

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NUI Executive Team

Banging Them Together

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Fully Integrated Multi-Distribution Insurance Company

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Patrick, and that spread through the company.

Speedy Selection Process

Profits Return...but with Friction

6 CGNU Annual Report and Accounts 2000.

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Integrating the Personnel

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Convinced of the new philosophy, the team charged ahead.

Five Lakes Conference

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Most of all, though, they were concerned with what to do next.

CGNU to be included in the UK life assurance sector

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