Pat Kenny, Day One
If anyone belongs in a column called “At Large,” it’s the president of the International Insurance Society. The peripatetic nature of that job is well documented. In fact, when I interviewed the now-departing John Meyerholz some months back, I called him “the Marco Polo of American insurance.” It seemed appropriate then to open a conversation with his successor (on his first day on the job, incidentally) with the obvious wisecrack, “I hope you like to travel.”
As it turns out, Patrick W. Kenny has been traveling abroad extensively and living internationally for the better part of a long career. That, and his avid interest in international business, his financial background and, not inconsequentially, his long involvement with the Society are what brought him and the IIS together–at the top.
Pat Kenny is no stranger to the International Insurance Society. He attended half its seminars over the last 37 years, largely in connection with a nine-year tour in Paris and The Hague as head of the insurance audit practice in continental Europe for KPMG Peat Marwick, but continuing during a six-year stint as chief financial officer of Aetna Life & Casualty.
He sat on the IIS board from 1987 until 1991, chaired its finance committee for some years, and “mildly takes credit” for getting the Dutch, now big Society players, involved in the organization, having introduced IIS founder John Bickley to Dutch insurance moguls back in 1977.
“It’s an organization I’ve been involved in, that I’ve seen grow, that I’ve seen mature, that I really believe in,” says Kenny. “This is an opportunity to give something back.”
His primary goal, on this first day of his IIS presidency, is “to continue to increase the membership, to build on the outstanding reputation the Society has with its international meeting, to burnish it, to make certain it shines as well as it has in the past.”
Also, “to be responsive to the parts of the world that change,” he adds. “We see activity move sometimes and we want to be responsive to that movement of activity–whether it’s new sources of capital, changing marketplaces, whatever.”
Kenny anticipates no immediate changes in the core business of the Society, which is the staging of its annual meeting. “I think it’s a challenge to continue to identify the issues and to be responsive, because what attracts people to the seminar is issues spoken to and spoken about by the major insurance leaders of financial services in the world,” he says. “They want to hear the people who make the decisions that most impact the industry on the critical issues of today.”
There is one area where he would like to see some change–and that’s the IIS Hall of Fame. “It’s a concept,” he says, “which is extremely relevant but may have an anachronistic title.” To him, the idea of an industry paying tribute to people who have made substantial contributions over the years is “phenomenal.”
However, he says, it bears a very American name, “a name that downplays in other cultures the importance of what you’re trying to do. I don’t know that we want to change it, but we do want to figure out a better way to get the appropriate recognition and understanding of what it means.”
Moving to broader issues that affect the membership, I ask Kenny about the future of a globalized insurance business given the anti-globalization movement and a deepening recession.
“Doesn’t it ultimately boil down to competing for capital?” he asks rhetorically, adding rhetorically, “What does anti-globalization mean? Is it going to stop you from getting market share? Is it going to stop you from getting the people you need to do business? Is it going to stop you from getting capital?”
Companies, he says, “will have to be nimble, to find niches, to continue to work in the environment they’re in.” Insurance may be a global business, he adds, but especially with passage of Gramm-Leach-Bliley, companies will continue to seek broader opportunity.
I ask him too about the future of the property-casualty business, with a lot of the carriers reducing their stakes and moving into the life business. “There are those betting in the other direction, of course,” he says. “I think it’s timing and what people perceive their strengths to be and where people want to see the business going. If you’re in a particular niche in the property-casualty business and you’re doing well at it, there may be temptation to jump into something else, but I don’t see Progressive, for example, going into the life business. Or Liberty Mutual. You have to look at it company by company.”
What about global purchase patterns? It seems that foreign insurers are more interested in U.S. companies than the reverse.
For one thing, he explains, the market is bigger here. Outside the U.S., smaller markets tend to be concentrated in a small group of companies, companies that have dominated those markets for generations. For a U.S. insurer to penetrate a foreign country, it has to buy a major insurer and get regulatory approval in an environment where the barriers to entry are significantly higher than they are in the U.S.
As long as 20 years ago, he says, one Dutch company had over 50% of its premium volume outside the Netherlands, a small country of 15 million people. The other 50% was in the U.S. (with its hundreds of millions) and Canada and the Far East. Today, that company is ING.
There are exceptions, he says, like the vast markets opening up in China, India and Southeast Asia, where companies like Aetna and New York Life, for example, have made inroads in life insurance and that hold great promise on the life and asset accumulation side of the business.
Anything to add, Mr. Kenny?
“Maybe on day two I’ll have more,” he quips.
Reproduced from National Underwriter Life & Health/Financial Services Edition, July 13, 2001. Copyright 2001 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.