James Moore: Standard Life could still be undone by hubris

Outlook Standard Life was once the gold standard among insurers. Independent financial salesmen, sorry, advisers, would routinely push more of half of their clients in its direction.

There was a good reason for this, and it wasn't entirely down to the commission those products paid. They knew that while Standard's products weren't necessarily cheap, they were reliable.

Until, that is, the hubris of its directors caused the then mutual insurer to flirt with a business model that looked suspiciously like Equitable Life lite, running the operation with a level of reserves that caused heart murmurs among its regulators.

The insurer has since floated, and clawed much of its reputation back by adroitly positioning itself to take advantage of changes in savings market, sometimes driven by Government, sometimes by those regulators. While at the same time re-establishing a reputation as a relatively safe home for people's savings.

As a result, business is flowing back again. It hasn't hurt that Standard has been pursuing its revival at a time when large parts of the sector have question-marks against them. Aviva is a bit of a mess, Prudential's big focus is its ambitions in Asia, which has produced lots of business but lots of problems with watchdogs, including a big fine, and Resolution? Well, it has a big job integrating all the businesses it acquired as part of its vainglorious bid to create a UK super insurer while its long-time goals are, well, still not entirely resolved.

Legal & General is in fine fettle, but that backdrop is still a handy one if you can exploit it, as Standard appears to be doing.

The danger, as ever, is that hubris, which seems to be endemic to the financial services industry generally. Hubris which hasn't entirely been purged from Standard. If you want evidence, take a look at the pay packages handed to the company's current executives. It wouldn't be entirely fair to suggest that they set the gold standard for excess. But they're getting that way, even if David Nish and his team almost look worth it compared to some of their rivals.