Steering towards success
Talbir Bains’ guiding principles come from his lifelong devotion to family and religion, his empirical approach to pricing and risk - and maybe just a little bit from his love of ‘80s classic cars…
On any given Sunday morning, you will most probably find Talbir Bains on the M25, circling from his home in West London to a hangar near Stansted Airport where he, along with two of his sons, indulges in his other great passion in life.
The founder, CEO and CUO of Volante Global has devoted much of his time to pursuing his driving ambition to make Volante one of the most distinctive players in the MGA market.
As Bains told The Voice of Insurance podcast last December, he estimates that the firm could reach $500mn in annual gross written premium by 2023, from a base of just shy of $200mn last year, based on organic growth from the MGA’s 2020 underwriting figures.
However, at the weekends, it’s all about driving something completely different - or, more accurately, about transforming it.
Like many an executive in the insurance industry, Bains likes nice cars and, like many business people before him, he likes collecting them too. However, where he departs from form is in carrying out a nut-and-bolt restoration on every car in his collection.
In the 23 years or so since he joined the market, he has amassed a collection of largely German, automobiles from the 1980s and ‘90s - Mercedes, BMWs, Porsches, Audis
“Since I started my (insurance) career I’ve been fixing cars. Buying an old car that needs attention, that needs TLC, and with my two elder boys, who are 18 and 14, taking that project on and restoring them - we ‘pimp my ride’ as they say.”
In the 23 years or so since he joined the market, he has amassed a collection of largely German, automobiles from the 1980s and ‘90s - Mercedes, BMWs, Porsches, Audis - plus a Ferrari 328 GTS, that he says, “sneaked into the collection”.
“It’s something we enjoy – the cars are so mechanical, so simple, and restoring them is a real joy. The bodyshop work is something I don’t do, but in terms of full mechanical drive train, wiring, interior - that’s something I’ve learnt to do over the years, and I’m teaching my boys to pick that up, And hopefully, in the years to come that will be another legacy to leave behind – a collection of really unique cars,” he says.
Which brings us to his other legacy – the MGA business he founded and which he continues to run as chief executive.
As a mathematics graduate, Bains’ entry into the insurance space was, perhaps unsurprisingly, in an actuarial role. He joined Willis in 1998 in the general insurance segment, before moving into the underwriting sector, first at Swiss Re and then later QBE, where he ended up leading the motor and business performance (retail) segment.
“I enjoyed bringing some sort of empirical analysis to broking and then to [risk pricing] at underwriters,” he recalls.
From QBE he moved into underwriting itself, as global CUO of ‘super-MGA’ Dual, where, within a year, he had moved into the joint role of group CEO and group CUO. This would probably be sufficient responsibility for many but Bains, with those twin drivers of an empirical approach to risk analysis and the desire to get down to the nuts and bolts of a thing, before rebuilding it from the bottom up, a further move seemed inevitable.
And so it was in October 2017 that he launched Volante Global, an MGA with the unique, and uniquely challenging, premise of a delegated authority business that is wholly dependent on its capacity providers meeting their combined ratio targets.
“What we have achieved in Volante is to revolutionise the industry model around how MGAs operate with their carriers, in having zero margin fixed commissions and being 100% dependent on profit commissions over the long term - over the 5-year period or more,” Bains explains.
“It's risky because, for reasons outside of our control such as macroeconomic factors or industry loss events, there could be an outcome where Volante doesn't make its plan - but we're in the risk business.”
What we have achieved in Volante is to revolutionise the industry model around how MGAs operate with their carriers
Fittingly enough, given Bains’ extra-curricular interests, ‘volante’ translates as ‘steering wheel’ in Spanish, Italian, and Portuguese, as well as being (perhaps less fittingly, given Bain’s predilection for German engineering) the designation given to the convertible versions of several Aston Martin models.
Natural born leader
But while he has kept his hands on the steering wheel at Volante since its conception, what he shares in common with a number of leaders of innovative businesses is a recognition that being a leader is not just about being in charge.
“I would like to think [leadership] was a very natural progression for me. Coaching and managing others has been very rewarding, very inspirational, and so often it's a great way of crystallising your own thoughts about where you're heading. And it's a great foundation from being a manager to being a leader where you're energising people to realise a strategy and realise an entrepreneurial vision.”
Bains says he feels it is important to give his team “the confidence and the empowerment to achieve their own vision around their own franchise within Volante”, plus the resilience “to overcome any obstacles that may be on the path ahead”.
“That's where leadership versus management comes into its own. You must always be able to lift people - to realise their mission and reach for the stars. It's not just about the completion of a task.”
For the Volante CEO, this lies at the heart of the distinction between a corporate leadership role and that of a business owner.
“It’s about being invested in that vision - not just financially, but almost spiritually. It comes about in a very natural way when you are building your own business and every team we hire into Volante has that feeling of putting their stamp on how we bring that business to the market.”
In addition to managing a team, Bains says that combination of an empirical mindset and the willingness to create a shared vision has informed his approach to business relationships too.
“I've always enjoyed working towards a solution from first principles. The advantage one has with that empirical approach to pricing is that the transparency you can give to stakeholders and clients, and the journey you take them on from data to price becomes very straightforward.
“It's very easy to explain, especially to clients who may often perceive that insurers are making more profit than they should, and puts it properly into context around how being sustainable, having longevity and good security, is the reason for aiming for a certain profit margin.”
If you look after the combined operating ratio of your insurers then the MGA's EBITDA plan takes care of itself, and investors’ requirements look after themselves
Bains says the Volante model necessitates prioritising the “objectives and strategic ambitions of our stakeholders”, which he argues is actually “a great way to build an [MGA] business, because our outcomes are a function and a consequence of what we do for our stakeholders” – both internal stakeholders (i.e. employees), and key external stakeholders, namely its carrier panel and investors.
“In the MGA world you are in the position [of having] two masters who sometimes have almost conflicting financial ambitions: your investors are centred on growth and achieving the MGA EBITDA plan; and your capacity is focused on return on equity and combined operating ratio.
“But if you look after the combined operating ratio of your insurers then the MGA's EBITDA plan takes care of itself, and investors’ requirements look after themselves.”
Bumps in the road
Bains concedes, however that “not all investors give you the luxury of time to achieve that position – and time is everything for an underwriting institution”.
“Balancing those two masters is the MGA's challenge. You're reliant on third parties to support you and be loyal in their commitments, and sometimes those commitments have to be retracted because either your own performance as an MGA hasn't been up to standard or some strategic change in the capacity providers’ own [business] may have had an impact.”
While there have definitely some challenges and setbacks in Volante’s journey, Bains says “the one thing that keeps resurfacing is resilience”.
“I always say to my people, don't worry about the time the setback occurs and how you might land on the canvas, just think about how you're going to get up from the canvas and respond.”
Part of that resilience is recognising the individual strengths of your team. Bains says that one of the biggest lessons he has learned in the past decade is teaching himself that, “other people's motivation can be different to your own, and whilst you're striving for the same outcome, there are different paths to get there”.
“As long as those paths are broad ones, in terms of the principles being aligned with the industry and with our stakeholders, and our hearts are in the right place, then it's fine for [people] to do things in a different way to get to the same outcome.”
Time for reflection
One guiding principle in Bains’ own life has been his devotion to his religion, having been baptised as a Sikh at eight years old.
“I'll never forget when I joined Dual and I called my ex-boss and shared the news with him that I was being made CEO, and he said to me one thing that you should always do is stay true to your principles,” he recalls.
“That has served me well during my time at Dual and in Volante - I was able to tie that to my religion in so many ways. Sikhism is about staying true to your principles and never trying to be something you are not. And I think that's ultimately what our stakeholders see in our business: we're a group of people who always stay true to our principles.”
Keep your heart in the right place - and by that I mean always focus on the best outcomes for your clients, for your stakeholders
During both the challenges and the new-found freedoms brought out by the pandemic over the past year and a half, the role that religion plays in Bains’ life has also become more prominent.
“Since lockdown began, I've been conducting recitals at the local temple each morning and that's been a great time to spiritually relax and reflect as well,” he says.
“The religious aspects of the teachings always talk about human values and compassion and good conduct and being true to your principles. So those teachings and guidance have been very influential.”
Like many other insurance executives, working long hours in the sector, Bains has discovered some personal advantages to the enforced home working of the past 15 months.
“During the 23 years of my career I had probably not been [giving enough time] to family, it had all been work, work, work. My children have seen a lot more of me over the last year and a half than they ever did. Hopefully, going forward, we can all realise the benefits through hybrid working of enriching that home and family life that perhaps some of us have really missed.”
It has also afforded him more exposure to the other big influence in his life.
“My wife Sharan has been a very significant influence, a calming influence on me, during those times when setbacks have occurred - just keeping me grounded throughout all of that. She has always been there, no matter what time of day I come home, to share in the trials and tribulations along the journey.”
In addition, like many during this period, he has taken the opportunity to focus on his physical wellbeing too, through running and weightlifting.
“I’m quite pleased that I’ve lost over 9 kilos over the last 6 months - partly forced by my wife. I’ve always enjoyed being physically in good shape, but being aerobically fit is a challenge. So I’m running 25-30 km a week. It’s both physically and mentally rewarding when you do make that time for yourself.”
When asked to reflect on what he might have ended up doing had he not chosen insurance as a career, Bains’ answer, while unusual, is probably not all that surprising.
“I would love to have combined my analytic mind and my car hobby to become a car designer,” he says. “Someone in the car world who has been very inspirational to me is Gordon Murray, who was one of the chief designers in Formula One at Maclaren, and designed the Maclaren F1. He is super gifted from an engineering perspective but also super humble - he’s just an outright gentleman, but one who you feel in awe of because of how he thinks.”
Back in the business world, Bains’ advice to anyone looking to follow the path of growing their own insurance operation is simple.
“Keep your heart in the right place - and by that I mean always focus on the best outcomes for your clients, for your stakeholders, because it’s about achieving the right endgame.
“Don't make it about profit here and now, today, for us; make it about long-term profit for our stakeholders and the right outcomes for clients. Because ultimately the right outcomes for them are the right outcomes for us.”