The ACE face: Ken Underhill, ACE European Group
28 February 2011
Ken Underhill, GC at insurance giant ACE European Group, not only runs a tight ship, he also wants his panel advisers safely on board. By Katy Dowell
A year after Ken Underhill was appointed as ACE European Group general counsel he established the underwriter’s first formal panel (The Lawyer, 1 October 2008). More than two
years on and he is looking to tighten relationships with his panel firms - and he wants them to come up with methods for doing so.
“Our approach is to build long-term relationships with our firms and have them understanding our business and partnering with us,” he says.
Underhill is not an easy taskmaster. Having worked both in-house and in private practice (at Reynolds Porter Chamberlain) before joining ACE, he is clear that law firms must perform to the insurer’s high standards.
“We want lawyers to be solutions-driven and to be able to tell us what that solution is in an executive summary,” he says. “We get too many emails from too many sources. If you’re caught in the office dealing with that you’re not hearing what’s going on in the office. [Lawyers] should be telling us face-to-face.”
For firms that have secured coveted places on ACE’s panel there is a plethora of work. Underhill says, where possible, the instructions are divided evenly between the panel firms, which comprise Clyde & Co, the CMS network, Holman Fenwick Willan, Mayer Brown and Norton Rose.
“I have to do my best to push our guys away from favouritism,” Underhill reveals. “So we have one firm assisting with a compliance issue, another with a distribution agreement, while somebody else will be looking at a consultation. There’s also corporate work and tax. It’s a broad range of stuff.”
As a consequence there are times when the insurer will go off-panel. However, Underhill remains steadfastly loyal to his panel. “I’d like to think that some of the firms will still be on the panel when I retire,” he says.
To that end Underhill is asking his firms to devise innovative ways of working together without compromising competition between them.
“An area that people can do better in is around the use of technology - I don’t think we see enough advanced thinking around the flexibility of approach to technology,” he says. “We need better, more updated training around the use of technology for legal updating, training programmes, storage and use of data.
“We’re developing our own knowledge centre and we’re looking at how firms can approach that holistically. There isn’t enough of that sort of thing and we want to work with people who are partners in our business.”
ACE runs a slimmed-down legal function, being home to around 15 lawyers, who are considered senior managers. As a result Underhill is under pressure to get the most out of every solicitor in his department.
The company’s lawyers sit alongside insurance line managers in their own jurisdictions, reporting to the management locally. Those lawyers will partner with lawyers based in the in-house department in London on certain deals to ensure consistency of approach across the business.
“Quite often it’s something we’ve already done in another jurisdiction, but we have to allow for the EU variations in law so we have someone in that jurisdiction,” explains Underhill. “We have a nimble business model and there’s not a huge number of lawyers. It means everyone’s busy. On occasion we need to find other ways of working, so we’ll bring in teams, outsource or request secondments.”
Primarily, each in-house lawyer will report to their own non-lawyer managers in their jurisdictions, but the insurer also operates a matrix reporting system into Underhill in the City.
When it comes to setting the objectives to be achieved by the in-house practitioners, Underhill will partner with a client so that “objectives are orientated around the business”.
The biggest challenge ACE faces is, like many of its peers, the constantly changing regulatory environment.
“In the past couple of months we’ve reviewed and responded to consultations and discussion papers from the EU, Ireland and the UK,” Underhill adds. “And we’ve had to adapt quickly to changes in the law in a reasonable proportion of countries, including Germany and Italy.”
In the US ACE has its own government affairs department. Underhill anticipates that this will be expanded into Europe. “It’s often overlooked that law and regulation can be overburdensome,” he says. “We have a very strong interest in seeking to influence the development of regulatory changes directly and through industry bodies and contact with our competitors.”
Underhill would like to see the external lawyers he employs working more closely with the company as his team does with ACE. He appreciates the long-term nature of this goal and that it will necessitate partners from competing firms working together - something that goes against the cultural grain for most private practice lawyers.
The gauntlet has been thrown down and ACE’s panel firms will have to meet the challenge Underhill has set them. Further down the line, though, it can only help them to serve their clients better.
Name: Ken Underhill
Organisation: ACE European Group
Title: General counsel
Reporting to: CEO and chairman Andrew Kendrick
Legal spend (non-claims):£5m-£10m
Main external law firms:Clyde & Co, the CMS network, Holman Fenwick Willan, Mayer Brown, Norton Rose