Outward bound: Simon Gildener, Howden

Simon Gildener of insurance brokers Howden is an in-house legal chief with a difference – in what may prove a legal business model of the future, he’s there to advise the company’s clients as much as his own board.

Outward bound: Simon Gildener, HowdenTraditionally, the general ;counsel position ;is ;an ­internal-facing role where client contact is limited. But for Simon Gildener, general counsel of Howden Insurance Brokers, the role has been turned on its head. He is there as much to offer clients legal advice as he is his own board.

“Partially it’s an in-house role. I’m a qualified resource and the company wants to use that,” explains Gildener. “But it’s always going to be an outfacing role – the external comes first.”

He readily admits his is a “fledgling position”, but says the broker “expects clients to be enthused” by his addition to the Howden board. So why appoint an insurance lawyer in a client-facing role?

“Howden specialises in complex liability products, with an emphasis on financial services,” says Gildener. “The management spotted a growing trend of legally qualified personnel joining the [insurance] claims department. When faced with ­legally qualified people, it can lead some people to perceive a gap in skills at the more technical end of claims ­handling. My appointment is specifically designed to address that gap.”

This means that as well as ­contributing to the development of new insurance products, Gildener is on hand to advise clients directly if his views are needed. Howden is the ­brokerage arm of Hyperion Insurance Group and, as such, has clients based all over the world.

“We have an international client base because of all the money coming through the London ­insurance ­markets,” Gildener says, which means he could potentially be dealing with legal challenges in a number of jurisdictions, although most ­contracts placed with Howden have a jurisdiction clause. And while Gildener claims he has “never worked harder”, he is anticipating a rapid rise in claims activity against insurers as the recession deepens.

“Experience dictates that the recession will lead to an explosion in claims, which means professional advice will be open to a lot more scrutiny,” he says. As Howden is in the business of insuring those professions, it is about to hit a busy period.

“These are complex claims and it will take some time to filter through to the insurance markets, but they will come,” Gildener insists. “Everybody is trying to shore up their own positions – it’s a matter of self-preservation.”

It is an honest admission, and while other brokers may be looking to beef up their legal expertise, Howden is the first to offer a “value added” legal service in what may be a legal business model of the future. The Legal Services Act will allow financial institutions to take a limited stake in law firms, and while Howden is not considering this option at the moment, Gildener’s appointment shows how some brokers could use the provisions within the act to their advantage.

Brokers act first and foremost in their clients’ interests, although they are remunerated by the insurers they place the business with. As such, ­conflict is inherent in the trade and everything must be recorded to meet the demands of the Financial ­Services Authority (FSA).

As part of his role, Gildener is responsible for compliance. “We have compliance officers but my background gives me a lot of broker ­regulation experience,” he says.

Transparency and client monies are the main themes of the day, but while the FSA is busy trying to restore confidence in the financial services sector these are on the regulatory back burner. More important is the financial liquidity of the ­international insurance companies. Gildener says he is “keeping a close eye on the ­security of the markets”.

This is essential given the furore surrounding the market and the agencies that rate their security.

“Things such as AIG being nationalised bring everything into sharp focus,” Gildener sighs. “We’re being proactive in protecting our security and how we rate that and what advice we give to our clients. We’re all aware of the fire under the rating agencies, but the lack of an alternative means we have to use them.”

Compliance also means that Gildener is responsible for training, compiling evidence of training and managing internal errors and ­omissions risks. He expects that eventually the broker will grow a strong legal team, but for now he is a lone lawyer in a world of brokers.

Gildener says he was concerned that he might be sat “twiddling my thumbs” for the first few months, but the opposite has been the case.
“I’m delighted to say everything has come to fruition,” he enthuses. “It’s a new general counsel role to help shape a new service offering. I can be influential in the business and learn things that I wouldn’t if I was sat in my legal ivory tower.”

Name: Simon Gildener
Organisation: Howden Insurance Brokers – the broking division of Hyperion Insurance Group (HIG)
Industry: Insurance
Position: Director and general counsel
Reporting to: Chief executive Tim Coles Operating profit (HIG numbers to 30
September 2007): £8.1m
Number of employees: 130 (UK-based)
Legal capability: One
Legal spend (HIG): £800,000
Main law firms: Taylor Wessing

Simon Gildener’s CV

1992-95: Bachelor of Laws, Nottingham University
1995-96: Nottingham Law School
Work history:
1996-98: Trainee solicitor, Hammonds
1998-2003: Solicitor, Hammonds
2003-06: Senior solicitor, Robin Simon
2006-08: Partner, Robin Simon
September 2008-present: Director and general counsel, Howden Insurance