Pictured: Maurice Tulloch, appointed CEO of Aviva.
British insurer Aviva has appointed Maurice Tulloch as the new group CEO.
Mr Tulloch, who first joined the firm in 1992, replaces Mark Wilson, who stepped down last October. The long-awaited appointment comes as the company faces increased pressure to deliver more shareholder returns. Company chairman Adrian Montague, who had temporarily stepped in as CEO, will revert to his role as non-executive chairman.
A word from the Chairman
Mr Montague said in a statement that the decision, which an Aviva spokesman said was taken by the board on Sunday night, was unanimous. External and internal candidates were considered, he added.
He added that the new man in the hot seat knows Aviva “inside out” and is “exceptionally well qualified to re-energise” the firm, describing the appointment as a “unanimous conclusion and a great result for Aviva.”
Mr Tulloch was born in Falkirk, Scotland, and holds dual British and Canadian nationality.
He has held a host of roles in the firm including, most recently, CEO of international insurance for the firm, with responsibility for Aviva’s life and general insurance operations in Canada, France, Italy, Poland, India, Turkey and Ireland. He has also served as CEO of Aviva UK and Ireland general insurance, CEO of Aviva Canada, and, prior to that, executive vice-president and COO of Aviva Ontario.He was appointed to the board in 2017.
Mr Tulloch is a Chartered Professional Accountant (CPA, CMA), and holds a MBA from Heriot-Watt University in Edinburgh and a BA in Economics from the University of Waterloo. He is currently a member of the Insurance Development Forum (IDF) and a Non-Executive Director of Pool Re, and was previously Chair of ClimateWise.
It is reported Mr Tulloch will receive a basic salary of £975,000 (€1.1m) and will be eligible for a pro-rated annual bonus opportunity that will pay up a maximum of 200% of salary for his time in the role of CEO. He will also be eligible to receive an award under Aviva’s long-term incentive plan for 2019, which typically pays out 300pc of base salary, as well as the standard Aviva executive benefits package including pension contributions of 14pc of salary and £250,000 (€290,000) to assist with his relocation from Canada.
Who is he replacing?
Mr Tulloch assumes the role vacated by Mark Wilson late last year, after more than five years at the helm. Mr Wilson is credited with turning the company around, but a decision in March 2018 to join the board of rival asset manager BlackRock did not sit well with some shareholders.
Under Wilson’s leadership, Aviva completed one of the biggest insurance takeovers in a decade by buying Friends Life in 2015.
However, despite improving profitability, Wilson failed to turn Aviva share price performance around with the company’s stock up 25% during his tenure compared to a 61% return for the insurance sector within the FTSE-100.
After the new CEO announcement, Aviva’s shares were up one percent at 436.6 pence at 10.20 GMT, outperforming the broader FTSE 100 index.
Tulloch, who will take over with immediate effect, is expected to sharpen Aviva’s focus on the home market and some analysts predict he might put some overseas units under review, including some of its Asian businesses.
Other possible changes include the sale of some of its portfolio of life insurance policies closed to new customers.
In his statement, Mr Tulloch said:
I am honoured to lead Aviva, a firm I’ve been part of for 26 years. There is a clear opportunity to realise Aviva’s significant but untapped potential. Aviva is financially strong, we have a well-known brand and excellent businesses. But there is more to do to improve returns to shareholders.
“We must focus on the fundamentals of insurance and giving our customers the best possible experience – being there when they need us, protecting what’s important to them and helping them save for the future.”
In the running
Tulloch was seen as one of the front runners for the post along with fellow internal candidate Andy Briggs, head of the firm’s UK business, its biggest revenue earner.
Possible external candidates included former Old Mutual CEO Bruce Hemphill and ex-Lloyd’s of London CEO Inga Beale, Reuters reported last month.
“We believe the protracted process of bringing in a new CEO and the rumours of external candidates shows the board’s desire to see change within the group,” Barclays analysts said in a note, reiterating their overweight rating on the stock. Panmure Gordon analyst Barrie Cornes said Tulloch “will make changes where needed and shouldn’t be underestimated”.
The industry environment
Formed through the merger of Norwich Union and CGU in 2000, Aviva can trace its heritage back to the Hand in Hand insurance company which was established in 1696, 30 years after the Great Fire of London.
Aviva, which traces its roots back to 1696, sells everything from life to car insurance, an unwieldy and expensive model which has failed to deliver the same results as more focused rivals like Prudential and Legal and General.
In attempts to stay nimble and competitive, former Anglo-South African financial services business Old Mutual split its business in four last year, while Prudential is preparing to list its UK business separately.