# The Mighty Quinn - Revisited



## Lark (14 Dec 2001)

Just when the Quinn debate was running out of steam, two very interesting pieces in today's Independent on Quinn Direct and Quinn Cement.


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## Troy (14 Dec 2001)

*Shades of ICI/AIB?*

:rolleyes


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## CM (14 Dec 2001)

*Rumour & innuendo*

Troy - maybe you could expand on your contribution please?


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## tedd (14 Dec 2001)

*Re: Hmmmm....*

Yes, very interesting, especially as QL proponents argue that each subsidiary of the Quinn empire is separate from the others. In this scenario, this seems not to be the case. Definitely food for thought.


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## Troy (15 Dec 2001)

*R & I*

I wasn't innu'ing anything CM.  Just recalling the last time a successful operation got sucked into the black hole of insurance.:rolleyes


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## Nanny (15 Dec 2001)

*Capital injection*

From the article it semms that the general insurance operation got caught by the classic general insurance cycle at its worst, a fall in investment income coupled to underwriting loss'es. 

Mr Quinn however seems determined to ride it out, after all they've built the biggest direct general insurance business in the country, and heaven knows we need the competition very badly due to mergers and the like.

The injection I would have thought is a good sign the the regulatory checks and balances are in place. This would have been triggered by the DETE. The Quinn Group is estimated to be worth over a billion, comparisons to the est. £650 million taxpayer bail out of AIB in the early eighties is a stretch I would have thought.


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## Troy (15 Dec 2001)

*AIB/ICI cost the taxpayer nuffin'*

:rolleyes


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## Nanny (16 Dec 2001)

*AIB Bail Out*

Remember the bank levy? The Irish State had to stand over a potential black hole of £650m. In the end the extended underwriting loss'es were less, but it did cost.


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## Copernicus (17 Dec 2001)

*More from Niall Brady*

Niall Brady had an interesting piece in the Tribune at the weekend about Quinn Direct.  Seems like they tried to recoup growing underwriting losses by taking a punt on the Nasdaq - not a very suitable investment strategy for a motor insurance company, I would have thought.


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## Nanny (18 Dec 2001)

*Tech Punt*

Yeah, saw that. They probably won't try that again in a hurry. I'd imagine some parameters have been put in place to prevent wild swings in asset allocation into the future. If the tech market hadn't tanked we might never have heard about it, I suppose.

But we do need to see more competitors in the market, and lets hope Quinns first bloody nose won't steer others away, from what must be Europes most expensive and difficult underwriting markets.Quinn's should be encouraged to stick it out and to grow. Others might follow.

We certainly appear to be paying for our cultural fixation with spurious, and grossly excessive compensation claims. Not to mention dangerous driving, drink, and aggression where 1st world cars zip along 3rd world roads. The expected 20% to 30% hike in premiums to offset a staggering 90% hike in underwriting losses means I think we've the early start of a crisis on our hands. No good puting all the responsibility on the Insurers when we've a public that appear to see insurance as a soft target for petty fraud.

I know it's a related but different subject, but the troubles of one player shouldn't detract us from the big undelying issue, I would suggest.


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## Brendan Burgess (18 Dec 2001)

*A huge number of issues in this thread...*

<!--EZCODE BOLD START-->* Taxpayer's bailout of AIB*<!--EZCODE BOLD END-->

Everyone always refers to this as if the Government gave AIB some money. It's the very opposite in fact.

AIB bought the Insurance Corporation of Ireland in about 1982.
About two years later, it realized that its subsidiary was a disastrous investment and was fully entitled to put its subsidiary into liquidation and write off its investment. It would have had no further liability.
The Government  decided to put the company into administration to protect the policyholders and the claimants.

If AIB had not bought ICI, ICI would still have gone to the wall and no one would have blamed AIB. 

I have been pointing this out for years - and no one is listening. It just seems good fun to attack the banks.

<!--EZCODE BOLD START-->* The supposed motor insurance rip-off *<!--EZCODE BOLD END-->

I find it extraordinary that a Government commission can conclude that motor insurers are ripping off their customers! Quinn Direct shows it is relatively easy for a new competitor to enter the market but that it is very difficult to make money in this market. 

Nanny gives a good summary of why we have expensive insurance in Ireland. But again, I suppose it's good fun to attack the insurance companies.

<!--EZCODE BOLD START-->* Quinn Direct is a separate company*<!--EZCODE BOLD END-->

As I understand it, Quinn Direct, the general insurance company is separate from Quinn Life and from the other Quinn companies. The same person owns them, but that is the only connection. It should reassure people that the owner pumps in more money when things go wrong.

<!--EZCODE BOLD START-->* Investment strategy of Quinn Direct*<!--EZCODE BOLD END-->

The best long term strategy for a privately owned insurance company is to invest in equities. The owner has shown that he can tolerate the volatility of the stockmarket.

It is funny though, that Quinn Life's main marketing point is that passive tracking of indices produces a better return than active management. 

Brendan


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## Madonna (18 Dec 2001)

*Re: Indeed a Huge Number of Issues*

Perhaps the most important issue for AAM investors and readers of <!--EZCODE ITALIC START-->_ The Book_<!--EZCODE ITALIC END--> is just how reliable are QLD's supposedly rock bottom charges?

I think I would agree with you that the efforts to support the motor company suggest a long term commitment.

However, isn't it now clear how erroneous is the QL tactic - to attempt to win market share by undercutting the conventional market.

Long term savers with QLD want to ask themselves are the current low charges sustainable long term? or are they, just as in the case of motor, an attempt to buy market share? The difference is that QLD can increase their life charges at any time should the enterprise fail to gain market share, which by all accounts it has so far failed to do.

<!--EZCODE ITALIC START-->_ Boss_<!--EZCODE ITALIC END--> I think the DIY guide should very much tone down its support for QLD.  Anyone investing in QLD is gambling that it will attain the market share to honour the promised but not guaranteed low charges, early signs are that  it will not attain those economies of scale and so will have to increase charges. :rolleyes


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## Nanny (19 Dec 2001)

*Gambling*

Madonna, the gambling bit is not really reflective. All investments require calculated risk taking, even deposits where the call is inflation and default risk. 

Those invested in the Quinn Life operation know it's a start up. Heaven knows its been roundly bombarded for being so. I'm no fan of index tracking as the only way of making money, but with these products there is no guaranteed current or future liabilities in the product offering, hence no exit costs. No entry costs too if I'm not mistaken. That is a pretty clean crisp offering, just a fund charge of 1%pa.

That's what people have bought. They certainly didn't buy based on brand. If fund charges go up, Quinn's lose the business. There is nothing to stop a Quinn Life customer from encashing, unlike many other offerings around with discretionary charges, and lock downs.

The Life Regulator will be responsible for ensuring that the Life company meets all of its solency requirements. I think that casting a shadow over the maverick life operation could be misinterpretted as scare mongering, since it is a fundamentally different proposition than a general insurer, ( remember ICI Life sold for big bucks to the PRU, while the general business ran aground?). 

There is no justification for claiming unacceptable risk against the Quinn Life company. If there is one you can rest assured that the clamour would start at a different level than here in AAM, with respects to all participants.


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## Brendan Burgess (19 Dec 2001)

*Re: Gambling*

Nanny

Well said!

I actually posted a similar, but not as eloquent,reply at lunchtime today but for some reason it didn't appear.

In short, if Quinn Life puts up its charges, its clients can leave.

If a fund manager with initial or exit charges, raises its charges, you take a hit if you leave.

Brendan

There - I told you it was not as eloquent!


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## tedd (19 Dec 2001)

*Re: Gambling*

But surely if QL decides to alter its charging structure in the future, it could introduce an exit charge (witness Equitable Life)


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## monksfield (19 Dec 2001)

*Quinn*

I would have thought the weekend coverage raised serious questions about the senior management of the group & its strategy.
If the insurance business is as badly run/uncompetitive as Sean Quinn says, it should be possible to undercut the incumbents and still make money.It would seem to me that scale is their biggest problem and the current business model does not seem to be winning.
I also thought the Nasdaq dimension was quite revealing in terms of attitude to risk - if mirrored in terms of 'gung ho' underwriting ,large losses will be inevitable at some point.
While I would have considerable confidence that the regulatory framework in both the Life and General businesses would prevent them going to the wall, the owner's capacity ( or willingness) to keep injecting money should not be taken for granted.

My guess is that in the absence of a 'trade' buyer Quinn will not be in the insurance business in 3 years time.

I should declare my interests here as have worked in both the General and Life businesses and believe that despite the apparent attraction of the direct model,both businesses are well served by the vast majority of the Broking fraternity.


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## Madonna (19 Dec 2001)

*Re: Mighty?? Quinn*

See Blue Book, especially Section III.  Quinn Life had 386 contracts in force at the end of 2000.

My guess is that Quinn Life has more AAM postings than policyholders.:rolleyes


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## CM (19 Dec 2001)

*EL*

<!--EZCODE BOLD START-->* But surely if QL decides to alter its charging structure in the future, it could introduce an exit charge (witness Equitable Life)*<!--EZCODE BOLD END-->

This is a case of apples and oranges. EL always had the right to introduce MVAs and/or non-guaranteed bonus changes even if they traditionally did not implement them. The fact that <!--EZCODE ITALIC START-->_ have_<!--EZCODE ITALIC END--> used these to protect the WP funds generally since the whole GAR debacle is neither here nor there in relation to what QL might or might not do in the future.


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## tedd (20 Dec 2001)

*Re: EL*

I mention EL simply to illustrate the point that because there are one set of rules today, it does not guarantee that things will not change if a company's financial situation changes.

So my question is, <!--EZCODE BOLD START-->* could*<!--EZCODE BOLD END--> Quinn decide to impose an exit charge on current investors?


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## CM (20 Dec 2001)

*QL and the possibility of exit charges*

<!--EZCODE BOLD START-->* So my question is, could Quinn decide to impose an exit charge on current investors?*<!--EZCODE BOLD END-->

Good question. Whatever about them introducing an exit charge for new customers, I would have assumed that the fact that there is no exit charge is part of the (presumably contractual) terms & conditions of any existing customers' policies. However I don't know that this <!--EZCODE ITALIC START-->_ is_<!--EZCODE ITALIC END-->, in fact, the case.


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## Brendan Burgess (20 Dec 2001)

*Re: QL and the possibility of exit charges*

The Equitable Life comparison is totally irrelevant.

Equitable offered with profits funds which are completely different from the unit linked funds offered by Quinn Life. And of course, Equitable has not introduced exit charges on its unit linked products.

Quinn Life is presumably losing  money in its start up phase. But it just doesn't have the exposure which a general liability insurance company has. Bad underwriting by a company which controls 5% of the motor market can lead to serious losses. Quinn Life will probably be in a position for some years  where its annual charges do not cover the admin costs. But it won't lose serious money i.e. enough to worry its owner.

Brendan


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## Madonna (20 Dec 2001)

*Re: QL and the possibility of exit charges*

First of all I should state an interest.  Most people will be familiar with my singing, acting and stripping roles.  However, for my day job, I do earn a living from the the conventional life assurance industry; therefore I am <!--EZCODE ITALIC START-->_  a priori_<!--EZCODE ITALIC END--> an "enemy" of QL.  Now it seems to me that QL has more enemies than policyholders and with this posting probably more AAM contributions today than new clients. :b  

However, let's be fair.  The theoretical position is probably that QL <!--EZCODE UNDERLINE START-->cannot<!--EZCODE UNDERLINE END--> impose an exit charge but can do anything it likes on fund management charges.   For example, it could impose a one off 10% fund management charge "in the interests of all policyholders"

But that is unlikely.

If, as seems more likely, the QL experiment fails it will probably be sold off to, say, Irish Life.  They will of course immediately impose their standard rip-off charges.

But, in all lilelihood, the authorities will not allow IL to make a back-dated charge.

In summary, anyone embarking today on the QL low charge experiment will probably enjoy those benefits for as long as they last, but will probably in the end of the day finish off paying conventional charges.

Fellow conventionals should drop this obsession with QL, they are a non-event.  :rolleyes


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## tedd (20 Dec 2001)

*Re: QL and the possibility of exit charges*

Brendan says:

<!--EZCODE ITALIC START-->_   The Equitable Life comparison is totally irrelevant._<!--EZCODE ITALIC END-->

That's fine. But if people are deciding to invest with them (QL)SOLELY on the basis of their current charging structure, it's not unreasonable to ask what guarantees they have against future changes to this structure. 

tedd


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## monksfield (20 Dec 2001)

*non-event*

Agree with your observation - however the proverbial 'man from Mars' logging on to AAM (or reading Brendan's book)  would think they were a major force !!


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## CM (20 Dec 2001)

*Future charges*

Other than any contractural guarantees I don't see any obvious way in which future changes in charges can be predicted - whether it be in relation QL <!--EZCODE ITALIC START-->_ or anybody else_<!--EZCODE ITALIC END-->. Madonna seems to be suggesting that it could be a case of "make hay while the sun shines" (in terms of low charges) with QL for the moment until they inevitably get bought out or increase their charges to "conventional levels". However she also asserts that QL are a "non-event". These two opinions seem to me to be contradictory! Why should low charges - even if it was only for a few years be considered a non-event?

While we're at it, do people think that EBS Summit Funds will also eventually impose "conventional" charges at some point in the future or is this simply a QL bashing exercise? :rolleyes


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## Freddie Kruger (20 Dec 2001)

*Re: Non Event*

I gave up chasing this ghost a while back.

I think what Madonna means by 'non-event' is that there are a plethora of one man/woman brokers out there that are 'writing' the same amount of business that QL did in year one (without their overheads).

Perhaps I'm wrong. But then, she can <!--EZCODE BOLD START-->* correct*<!--EZCODE BOLD END--> me. Yum Yum!!


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## Irish Lifer (20 Dec 2001)

*Question for Madonna*

Madonna,

Having felt free to tag my company as indulging in "standard rip-off charges", perhaps you'd care to identify which of the conventional life insurance firms, or which branch of the industry, you work in so that we may reciprocate ?


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## Madonna (21 Dec 2001)

*Re: Answer from Madonna*

Ah now, <!--EZCODE ITALIC START-->_  Irish Lifer_<!--EZCODE ITALIC END--> don't take it personal. 

Note the word <!--EZCODE ITALIC START-->_   <!--EZCODE BOLD START-->*   "standard"*<!--EZCODE BOLD END-->_<!--EZCODE ITALIC END-->.  Couldn't this mean standard to the <!--EZCODE UNDERLINE START-->industry<!--EZCODE UNDERLINE END--> rather than standard to <!--EZCODE UNDERLINE START-->Irish Life<!--EZCODE UNDERLINE END-->? unless the cap fits of course. :rolleyes   

<!--EZCODE ITALIC START-->_  CM_<!--EZCODE ITALIC END-->, I meant <!--EZCODE UNDERLINE START-->QL<!--EZCODE UNDERLINE END--> are a non event, as <!--EZCODE ITALIC START-->_ Freddie (naughty boy!)_<!--EZCODE ITALIC END--> pointed out.  Their product is clearly superior (while it lasts) but so few are availing of it, why oh why can a thread like this and many others keep going on and on?

I want to suggest a moratorium.  No more mention of QL until April 1st 2002 (applies only to regulars of course and in any case the chances of anyone from the general public actually mentioning them are remote.) :b


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## tedd (21 Dec 2001)

*Re: Madonna's Moratorium*

<!--EZCODE ITALIC START-->_  I want to suggest a moratorium. No more mention of QL until April 1st 2002 (applies only to regulars of course and in any case the chances of anyone from the general public actually mentioning them are remote.) _<!--EZCODE ITALIC END-->

QL are one of the very few brands/companies recommended by this site. The book says that the AAM site will provide "the most up to date" information. It's only fair that people are free to comment on developments which may (or may not) be relevant to this company's favoured status.


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## Brendan Burgess (21 Dec 2001)

*Be careful watch you wish for.*

<!--EZCODE ITALIC START-->_ Editor's note: I have edited this posting as it seemed to refer to the failure of a company which hasn't failed_<!--EZCODE ITALIC END-->

The failure of Quinn Life to make large inroads quickly probably has to do with the resistence to changing from face to face business in the ROI. The collapse of <!--EZCODE BOLD START-->* finance2u.com ?*<!--EZCODE BOLD END-->, costing the owner apparently over £1million is more of the same.

The second likely issue has been the equity downturn within a short period after the start up I'd guess. Equity managers throughout the world have seen a flight to guaranteed investments like GEDA's, and the like. So the Quinn target market as a whole shrank, even though they were chasing 3% of it from reports.

The third issue was unquestionably the brand. It's a lot different parting with a thousand pounds for motor insurance which is a price driven commoditised market for most people, and sticking ten times that into a privately owned life office. Nevertheless the was and still is a market for this type of business if you are prepared to stick with the development of the company long term. See below.

It is unwise to sneer at a genuine entrepreneurial step, and the entry of a new model to a shrinking market choice, increasingly controlled by three bankassurers. I suspect that Quinn Life will seek a big brand partner, but I'd be astonished if it came out of the local pack. That wouldn't be Sean Quinn's style.

Much more likely is that Quinn Life will be partnered or taken over by sizeable and serious external player, bent on building a pan European business. The Quinn operation, technology, license, and energy would be an attractive route to market, depending only on costs.

A lot of banking people sneered at ACC bank, and laughed loudly when the NIB, and then later the TSB ventures collapsed, happy to see the market dominated by the big players. Now they've got RaboBank, an infinitely better managed, and bigger fish right in the backyard, operating as a community bank.

Be careful watch you wish for, Quinn life may be a route to market for a big energetic low cost player, and much like the tens of thousands who bought an ACC SSIA, Quinn Life policyholders may yet have the last laugh. In the meantime they've nothing to lose as outlined earlier.


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## Lark (21 Dec 2001)

*Sensitive Irish Lifer*

If your're looking for examples of rip-off charges, compare your Euro Stoxx with QLD - identical performance but big difference in charges.


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## CM (21 Dec 2001)

*QL versus EuroStoxx performance*

tedd - were you not around for ? The question initially posed is eventually discussed in  after a bit of a digression into whether or not EBS still offer net funds. :rolleyes


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## tedd (21 Dec 2001)

*Re: QL versus EuroStoxx performance*

Hi CM,

It wasn't me that asked, it was Lark. And no, I'm not Lark. 

tedd


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## CM (21 Dec 2001)

*Oops!*

Sorry - a case of mistaken identity!


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## Irish Lifer (21 Dec 2001)

*Sensitive Irish Lifer*

Madonna - your post specifically said "THEIR standard rip-off charges" so I don't think I was being over sensitive. Glad to hear you think our charges are in line with the industry generally.

Lark - the difference, as you probably know given that only insiders seem to comment on Quinn Life, is that IL pays commission to brokers whereas QLD does not. Maybe we even pay commission to Madonna, depending on exactly which branch of the industry she operates in. Our non-commission SSIA product, for example, recently was rated the best value other than the low-cost no-frills operators.

I have to say I get a bit fed up of the constant Irish Life bashing on this board. We may have our faults, but we are a successful, innovative, market-leading company, with more customers than anyone else in the market.


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## Lark (21 Dec 2001)

*Apples and oranges*

Irish Lifer,

Point accepted about comparing (rotten?) apples and (non commission-paying) oranges like Quinn Life. 

So let's confine ourselves to comparing the products of broker offices only. Now your charges are much more in line with the competition - except your products aren't. The other offices actively manage your money, giving them some sort of an excuse for their premium charges. You've thrown in the towel and offer join-the-dots index tracking, but you've kept the premium charges. A neat trick or what?


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## CM (21 Dec 2001)

*Irish Life bashing*

<!--EZCODE BOLD START-->* Our non-commission SSIA product, for example, recently was rated the best value other than the low-cost no-frills operators.*<!--EZCODE BOLD END-->

Sounds like not best value at all to me! Are EBS Summit Funds included in your "low-cost no-frills" category?

<!--EZCODE BOLD START-->* I have to say I get a bit fed up of the constant Irish Life bashing on this board.*<!--EZCODE BOLD END-->

I certainly hadn't noticed any trend of Irish Life bashing here and I have been on AAM since near enough its inception. If certain Irish Life products have high charges relative to other providers' products then any criticism is warranted in my view. If individuals have had bad (or good!) experiences of Irish Life and recount them here then that's their prerogative and part of what AAM is all about. Others are free to disagree and argue the case. However this is better done by arguing the facts rather than making claims of persecution which are unlikely to garner much sympathy around here.

:rolleyes


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## Irish Lifer (2 Jan 2002)

*Irish Life Bashing*

Responding to comments on this thread from before Xmas.

CM - yes, the survey showed our SSIA product non-commission to be more expensive than both Quinn Life and EBS .... but less expensive than Canada Life, Standard Life, Eagle Star, New Ireland, Friends First, Scottish Provident, and lots of other companies that don't seem to attract the same knee-jerk responses on AAM.

Lark - if, like most AAM posters, you're a believer in indexation strategies, surely you should be congratulating us for bringing index products to the Irish market, a major development. As to why we charge the same for it as others do for active management, well, <!--EZCODE ITALIC START-->_ as any fule kno_<!--EZCODE ITALIC END--> (as some book from my childhood used to say), the main costs of an investment policy are the seller's remuneration and the costs of administering it, which are the same whether it's actively or passively managed. Actual fund management charges are a very small portion of the total expenses.

While I'm posting, I saw Eddie Hobbs have a go at us in Sunday's <!--EZCODE ITALIC START-->_ Business Post_<!--EZCODE ITALIC END--> about our property funds. Again, he very graciously mentioned Irish Life by name even though pretty much every property fund manager has responded to the current market conditions in the same way. If he were a direct owner of commercial property at this phase in the cycle, doesn't brainy Eddie think that (a) he might have to wait up to six months to sell, and (b) that there might be some uncertainty about the price he might get. Property just ain't like equities. Things must be different on Middle Earth ! And while I can't speak for other companies, our sales literature was absolutely clear on what might happen, including even our cooling off letters. So if Eddie didn't like the way the funds were structured, then he shouldn't have let clients invest in them.

Finally, I see the normally voluble Madonna hasn't responded to my invitation to tell us who she works for. Obviously not as keen to reveal herself as she has been in another thread ! A bad case of pots and kettles, perhaps ?


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## CM (2 Jan 2002)

*Irish Life bashing*

<!--EZCODE BOLD START-->* lots of other companies that don't seem to attract the same knee-jerk responses on AAM.*<!--EZCODE BOLD END-->

Maybe you could provide some evidence of this alleged, and it seems by your implication persistent, "Irish Life bashing" and these "[Irish Life specific] knee-jerk resonses" on AAM?


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## Madonna (2 Jan 2002)

*Re: What kinda girl do you think I am, Irish Lifer?*

Haven't I revealed quite enuff?

I find the following quote from one of <!--EZCODE ITALIC START-->_ Irish Lifer's_<!--EZCODE ITALIC END--> earlier threads revealing in its own right.<!--EZCODE QUOTE START--><blockquote>*Quote:*<hr> <!--EZCODE ITALIC START-->_ <!--EZCODE BOLD START-->* "Glad to hear you think our charges are in line with the industry generally."*<!--EZCODE BOLD END-->_<!--EZCODE ITALIC END--><hr></blockquote><!--EZCODE QUOTE END-->If that makes you "glad" does it not rather suggest that it must in fact be flattering the Irish Life position?:rolleyes


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## Irish Lifer (3 Jan 2002)

*Huh ????*

Wow, you're waa-aay too Machiavellian for me, Madge ... why are all you guys so adversarial - if I'm glad you say something, then you must be wrong ?

All I meant was that I was glad you had clarified your earlier remark, and that your point about "rip-off charges" was aimed at the industry as a whole.

Ever thought of leaving the insurance industry and going into politics ?


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## Sammy (3 Jan 2002)

*Non-commission SSIA*

Hi Irish Lifer,

You mentioned the non-commission SSIA with Irish Life as one of the best products available a couple of times above.

How do I go about getting a non-commission SSIA from you?

Thanks in advance.


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## Brendan Burgess (4 Jan 2002)

*Re: Non-commission SSIA*

The only source of nil commission SSIA products of which I am aware is labrokers

Brendan


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## Mthrandir (5 Jan 2002)

*what a giggle*

Sorry Irish Lifer, I've been away on hols. Part of which was looking to buy property. DIRECTLY. For the record I've NEVER, in 22 years recommended a client to invest in a collective investment that invests exclusively in property. I think it should be bought directly on a geared basis, and plenty of it too!  ( Neither did I recommend Eircom, funnily I recommended readers not to buy Eircom, and go for a diversified Telecom fund instead, including Irish Life's, Heavens to mergatroid!)

And I've nothing against your employer. I've nothing for it either, just like any other product supplier to independent intermediaries. Property funds however were largely constructed and sold after the growth cycle was over, selling on the back of historical data. But fashion led funds are nothing new, and this has happened many times before.

The reason however that property is banned as an asset for UCITS is precisely because of its illiquidity, and potential entrapment of investors. That's the point. Don't take it personally. Its not your fault that you work for a PLC whose overarching requirement is shareholder profit, and not necessarily consumer protection. Its called the game, and your view of it will depend on your positioning.


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## The Virus (5 Jan 2002)

*Re: Priestcraft?*

<!--EZCODE ITALIC START-->_ Mith_<!--EZCODE ITALIC END-->, you frequently criticise contributors for changing the subject.  What in the name of the Pope of Rome has property got to do with this thread?:eek


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## Mithrandir (5 Jan 2002)

*Happy New Year*

Happy new year to you too Virus. See second last Irish Lifer post, 2nd Jan above. Hope you've had a virulent Xmas break! Live Mith.


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## The Virus (5 Jan 2002)

*Re: Oops!*

Apologies, <!--EZCODE ITALIC START-->_ Mith_<!--EZCODE ITALIC END-->, Topics about Quinn Life do tend to ramble off into the most obscure boreens, I missed that one.


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## Irish Lifer (6 Jan 2002)

*Reply to Sammy and Mith*

Hi Sammy - any broker <!--EZCODE ITALIC START-->_ might_<!--EZCODE ITALIC END--> be prepared to do a nil-commission SSIA with you, if you asked them. LA Brokers, as mentioned by Brendan's post, are definitely offering them.

Hi Mith - no problem with you having rational objections to pooled property investment. However, lots of investors don't have enough money (or time, interest, expertise etc) to invest directly, and pooled property funds are a reasonable alternative. Lots of our clients have made good money in pooled property, both long-term and shorter-term - 60% or so over the last three years approx. Certainly, some people invested later in the cycle and have seen little or no growth, although over a relatively short term ... and certainly still better than top of the cycle equity investors.

However, my basic complaint about your reference to us still holds true. If it's pooled property per se you're against, then why not say so, rather than singling out our funds and using the words "an appalling way to do business". It's the way all pooled products do business, and in fact I think we can reasonably claim to have been a lot clearer with our customers than any of the other firms.

Apologies that this thread has indeed gone down a boreen. I won't string it out further.


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## Mithrandir (6 Jan 2002)

*Product Engineering*

I've no problems with the idea that some sales people did a good job in warning investors about traps insofar as they will, without screwing up the sale. No the difficulty is in the construction first day. And in my experience of seasoned investors truly shocked by the way surrender takes place, ie place your order today, we'll encash in 6 month's, and no, we don't quote you any values until then. But if you don't like the size of the cheque you can always give it back to us.

How can you possibly then claim investors have got a return? The only people who made a return are those who had the cop on to get out before the hostages were taken. That doesn't include most investors, whose 'return' is highly questionable.

Had investors been properly warned first day that their money could become hostage like this, surely, it stands to reason they would have chosen alternative investments?


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## flash (6 Jan 2002)

*Irish Lifer*

have to reply
Irish Life has hoodwinked customers for 30 years, I know, I'm one of them.(on several saving schems)

You save for 20 years and get ZILCH.

Irish Life should carry a health warning


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## Mithrandir (7 Jan 2002)

*Irish Life*

Hi Flash, I have to disagree with a blanket comment that writes off Irish Life, and God knows I've had many occassion to lock horns with the life industry, and usually defended by Irish life in its capacity of dominating the IIF. The company has transformed itself largely, and shed much of the systemic bad practices. It is now managed I believe by a team that would tolerate little from its sales arm that didn't fit todays higher standards.

But it is still digging its reputation out of a deep hole, as is clear from your post. But that's not new, so too are many of UK's life offices for example. Nevertheless, sadly, the Irish countryside is littered with people who share strong views like yours, from the bitter experiences of the past. And that's perfectly understandable.

But todays multi-diciplined Irish Life doesn't carry on like the life office it was in the past. That's not an unconditional endorsement by the way, I still don't like to see Unit Linked Property funds promoted, independent advisors being lured with with trips to Dubai, and the like. Irish Lifes introduction of index tracking was long overdue, even if priced out very expensively. But todays management, while inheriting the baggage of the past, are good at what they do well. Service is one thing, and fund width is another, particularly for pensions business.


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## Dogbert (7 Jan 2002)

*Mithrandir's Worldview*

God, Mithrandir, it must be a barrel of laffs living with you. In an earlier post on this thread, you said:
<!--EZCODE QUOTE START--><blockquote>*Quote:*<hr> Its not your fault that you work for a PLC whose overarching requirement is shareholder profit, and not necessarily consumer protection.<hr></blockquote><!--EZCODE QUOTE END-->

When you did your Christmas shopping in M&S, did you rail against buying from a plc whose overarching requirement is shareholder profit, and not necessarily consumer service ? When you brought your kids to <!--EZCODE ITALIC START-->_ Lord of the Rings_<!--EZCODE ITALIC END-->, did you rant against the popcorn franchise as a firm (not sure if it's a plc) whose overarching requirement is shareholder profit, and not necessarily consumer interests ?

I've no particular axe to grind for any of the firms discussed earlier in the thread, but COME ON, it's a business world out there. Companies exist to make profits for their shareholders. In a competitive marketplace, that means that have to supply appealing products at worthwhile prices, or no-one will buy them, and they won't make any profits. Why should an insurance comapny be any different to a department store or a popcorn-maker in that respect ?


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## Mithrandir (7 Jan 2002)

*Independent Comment vs Non Independent*

Hi Doggie, no its all about context. Irish Lifer is forced to defend its employer unconditionally. Independent advisors are free to take and dismiss what they wish from all offerings across the market.

My earlier comments were made in that context. Your excerpt, taken out of the context of the thread, appears to imply I disagree with free market thinking. Couldn't be further off the mark there Doggie. As a business person, with a business owner clientbase I'm about as committed to it as any other. But that doesn't translate into accepting everything manufactured by industry, especially when, positionally, I'm supposed to act as the agent of the client.And in my case that has translated into consumer advocate at times. So what?

Much of the barracking i've got in the past is from folk who appear to have a great difficulty in understanding this position. Hell, that's no problem when they are from a DSF background, are tied agents, or Life office management. But when this line comes from 'independent' advisors, one really wonders if the concept of acting as the agent of the client is really just that, a concept, abandoned at the first conflict of interest conundrum. 

Even 'Broker' organisations in the past displayed their confusion in role on this critical difference. At one point a leader was to suggest that its members acting as the agent of both the life office and the client! Same source used a Baker baking bread, not disclosing margins to argue against commission disclosure. Heaven help us.

So Doggie, read nothing into my last post, other than an unwillingness to blanket a life office with a 'Don't Buy' label, simply because I don't like one part of what it does. That's simply being independent. Try thinking about it!


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## Brendan Burgess (9 Jan 2002)

*Re: Independent Comment vs Non Independent*

Hi Dogbert

To compare Marks & Spencer with Irish Life is not fair. 

With a retailer, what you see is what you get, more or less. You pay €30 and you get a shirt. It's a fair deal. It's easy to shop around and compare prices. If you can get a nicer shirt somewhere else, off you go.

Buying an investment product is much more complicated. Irish Life and most other life companies sold terrible products on very high commissions to suckers. It was a very unethical business. Charges were hidden and certainly the low early encashment values were not highlighted. 

I would guess than most Marks & Spencer customers are happy. Their returns policy is ridiculously generous ( speaking as a shareholder!). There are thousands of complaints against life companies for poor encashment values and misselling of products. 

Maximising profit is a fine objective, but not at the expense of people who you are supposedly advising. 

Brendan


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## Dogbert (9 Jan 2002)

*Free Markets*

Hi Brendan,

Okay, my comparison was a little glib.

But you seem to be trying to have it every way ... in <!--EZCODE ITALIC START-->_ the Book_<!--EZCODE ITALIC END--> you portray buying an investment product as not particularly complicated. Your introduction says it's aimed at people who spend less than a few hours a year on their investments. I spend more time than that buying shirts !!

What is different, surely, is that buying a crap shirt has no long-term consequences, whereas buying a crap pension or investment has.

But my basic point was that in a competitive marketplace, companies have to provide appealing products to survive. They can be either basic products at a relatively low price or very good products at a relatively high price. If they don't do that, then no-one will buy their products and they'll go to the wall.

You and Mithrandir are suggesting, probably correctly, that the old-style insurance/investment market in Ireland was not truly competitive or transparent, and that it was ill-served by advisers. But you seem to agree that the current market is pretty competitive, and that it will be better served by advisers.

So can we agree also that insurance companies, like retailers, airlines, popcorn manufacturers, and everyone else, are entitled to make a profit on their activities ?


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## Grundy (9 Jan 2002)

*Dogbert versus The Boss/Mithrandir*

Interesting contest, this.  

I have appointed myself the judge.  So far I score it 2 all.  When the contest seems to have run its course I will declare a winner with a summing up of course.  Others can feel free to get on the pitch on which ever side they chose.


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## Dogbert (9 Jan 2002)

*Reply to Mith*

Grundy - thanks for the encouragement ! As a humble cartoon character taking on such eminences, I feel a bit like Cardiff v Leeds on Sunday. I do promise not to invade the pitch, though.

Meant to reply to Mith last time but forgot. Mith, I'm not certain you got the drift of my post exactly (or maybe I didn't get yours exactly!). I've no problem with consumer advocates, except when they seem to be advocating that companies shouldn't try to make profits. Because that's what companies do. Nor am I either pro- or anti-Irish Life.

My point was that Irish Lifer has nothing to be embarrassed about in working for a company whose overarching requirement (as you put it)  is shareholder profit. Because if a mythical AIBer, BOIer, Friends Firster, Canada Lifer, Eagle Starrer, and even {gasp} Quinn Lifer had posted, then that would be true of them too.

As long as the company understands that the only way to make a profit in the long-term is to provide customers with appealing products (as I defined them in my reply to Brendan), then good luck to all of them. If they don't, then a competitive and transparent marketplace, well served by quality advisers, will sort them out.


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## Grundy (9 Jan 2002)

*Yellow Card!*

For the sly elbow into Quinn Life. 

<!--EZCODE ITALIC START-->_ Mith_<!--EZCODE ITALIC END-->, careful with your counter tackle or it could be a Red Card for you!


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## Mithrandir (9 Jan 2002)

*Comment*

Sorry fellas, but I don't see this as a match at all. And when I do need a referee, I prefer an expert at my sport. Not soccor.

But anyway the one line extracted from my earlier post appears the one causing the different interpretation. I attempted to clarify already, so I won't repeat myself. But if it does help correctly interpreting the earlier stuff, just ignore the line and read the rest. Love Mith, Capitalist, Self Employed.


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## Grundy (9 Jan 2002)

*Mith taks the Ball off the pitch!*

:eek


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## Joe Public (12 Mar 2002)

*Re: Mith taks the Ball off the pitch!*

It must be at least two days since there's been a post on the Quinn Group. Now some good news from the [broken link removed].


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