Between rock and a hard place

Profile: Max Taylor; Nick Gilbert on the guitarist who will go from naming his tunes to fine- tuning Names at Lloyd's
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The Independent Online
University drop-out. Lead guitarist with Skin Alley, a rock band. The 20-year-old John Maxwell Percy Taylor hardly imagined that he would end up as chairman of Lloyd's of London at the right side of 50.

Max Taylor, unknown outside the rarified confines of aviation insurance and reinsurance, was last week the surprise choice to succeed Sir David Rowland, the chairman who rescued the old City insurance market from collapse in the wake of pounds 8bn of losses.

At 49 he is leaving the quoted insurance broker Willis Corroon after 27 years, where he has risen from insurance trainee to joint number two to executive chairman John Reeve. He must first be elected to the Council of Lloyd's later this year and, short of an unlikely rejection, will in early 1998 take what Sir David described as "the best job in the world".

Taylor says: "I had expected to see out the rest of my career at Willis." Even the money - Sir David got paid pounds 450,000 a year at Lloyd's - is no great draw. "If you take into account my total package, share options etc at Willis, I will not be going to Lloyd's for a pay increase." So why go?

"How many people get the opportunity to be chairman of Lloyd's?" is the reply. Taylor beat some stiff competition, including Jonathan Agnew, the Old Etonian merchant banker turned Lloyd's underwriter, and a slate of non-Lloyd's insiders including, it is said, former Conservative Trade Secretary Ian Laing.

Then there is the knighthood that in the past has often gone with the job. Taylor and his wife Dawn, a 21-year-old photographic model when she married the 22-year-old ex-lead guitarist, would make a Sir and Lady direct from central casting.

Taylor is comfortably over six feet tall, handsome, his hair greying, broad in shoulder and narrow in waist. A keen skier, he does not look as if his weight has changed since he played rugby at Haileybury, his public school. He looks the part of Lloyd's chairman-in-waiting, sitting in his oak panelled office in Willis's magnificent headquarters, the old Port of London Authority building near the Tower of London.

Much of the job as chairman will be diplomatic. "His role is to represent the society at the highest of levels and make sure the council functions effectively," says Ron Sandler, Lloyd's chief executive. They should make a good duo. Sandler is, says Taylor, another dab hand with a guitar pick.

Taylor's task will be less demanding than the one Sir David faced in 1992. "His job will be easier in the sense that he will not have to deal with the crisis issues, but Lloyd's is undergoing a period of considerable change," says Sandler.

Recent profits at the Lloyd's market are slipping away. Sir David recently warned that profits this year are likely to fall below the pounds 600m forecast for 1996 (Lloyd's reports results three years in arrears).

Chris Hitchings, insurance analyst at UBS Securities, describes Taylor's task crisply: "Rowland won the war but Max has to win the peace."

All who know Taylor point to his immense charm and energy. "Max is a good business getter and a great meeter and greeter," says Richard Valentine, a partner with the head-hunting firm Tyzack and Partners who knows Taylor. But there is more to Taylor than charm and presence. An idyllic childhood with his two younger brothers on a farm in Essex was overshadowed when both his parents died when he was still a teenager. The three boys were brought up by an uncle and aunt. "I think I had to become independent at a pretty early age," says Taylor.

The public schoolboy failed to get into Cambridge and opted for Southampton University, but he dropped out after a year of electronic engineering. "I didn't fail, I just made the wrong choice of subject."

His entry into insurance was, he explains candidly, eased by his new wife's stepfather who worked 49 years man and boy at Willis. "I had just got married and I needed a permanent job particularly as we wanted to start a family."

Taylor started as a junior aviation broker in 1970 and worked his way up the Willis structure in the Seventies and Eighties - more profitable eras. He has worked overseas and run the firm's reinsurance and aviation divisions - the latter a particularly competitive market, according to insurance experts.

Taylor is much more familiar with information technology than most insurance brokers. "It is an enormous advantage to understand technology now that electronic trading is increasingly important in insurance," says Tony Latham, a senior executive at Royal Sun Alliance.

Taylor joined the board of the then Willis Faber in 1990, shortly before its merger with the American firm Corroon & Black.

His experience is wide and deep, he insists. "I can hit the ground running. I think I am someone who understands how Lloyd's works in some detail and I know the key players in the global insurance business."

Taylor will look good in the part of quasi-ambassador. He is unpompous, admitting to still picking on one of the seven guitars he owns. "I still love every kind of music from opera to rock." He has a good sense of humour.

"Owning a Fender Stratocaster is now a requisite for high office," he says, referring to those pre-election photos of Tony Blair strumming away.

But in picking Taylor, Lloyd's has gone for the safe choice, opting not to bring in a heavyweight outsider.

"Lloyd's has opted for one of their own in choosing Max," says Valentine. "He has been a member of Lloyd's most of his working life."

Taylor is in no rush to open up on the vexed question of whether insider Names working at Lloyd's, like himself, lost less than the outside Names. He is on several underwriting syndicates recommended by a members' agency which was a subsidiary of Willis. "I made underwriting losses during those difficult years," says Taylor. But he will not quantify their size.

There is also an irony in picking an insider. Willis's non-executive directors went outside the then struggling business to pick John Reeve, a professional from Sun Life & Provincial.

Taylor insists he backed the appointment and points out that had he stayed on at Willis he might have expected to become chairman if Reeve were to leave.

Taylor discounts analysts' speculation that to cut costs Willis will merge with Sedgwick, the other big quoted UK broker. They are tiny compared to US giants like Marsh & McLennan and their shares have performed dismally in recent years.

Insurance is troubled by overcapacity and falling premiums, so brokers have to find more customers just to maintain revenues."It's like running up the down escalator," says Taylor.

It might not be such a bad time for a career move. Taylor himself sees his job as long-term even though he will start off on a three-year term. "I would like to do the job as long as Lloyd's want me." Copyright: IOS & Bloomberg