Tuesday, November 23, 2010

(No.123) Insurance journalism & James Daw of The Toronto Star

I have been out of the country for several weeks and did not post any columns to RickardsRead.com during that time. In the previous 22 months I had written 122 columns on various subjects so it seemed that both I and RickardsRead readers were due a respite.

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As readers of RickardsRead.com may know I worked in the life insurance industry at the head office of the first Canadian mutual life insurance company: The Mutual Life Assurance Company of Canada. At the beginning of the millennium the company was unnecessarily and mistakenly demutualized at the instance of its senior management, became a stock company [as Clarica Life] and was soon thereafter taken over by Sun Life Financial.

During more than a decade out of the years I spent at Mutual Life I also (as a spare time activity) published and edited the Canadian Journal of Life Insurance. I conceived it to be my modest contribution to the industry's mental health although whether it had any measurable effect is open to debate.

CJLI was intended to be -- and always was -- an independent forum for informed criticism and comment about the industry and (contrary to the public and private assertions of various know nothings over the years) the Journal was always entirely separate from my then employer. In fact after the first issue appeared (a rather large surprise to Mutual Life's senior management) I came within a hair of being terminated and I was informed in writing by the CEO that my employment was hanging by a thread. It turned out to be a thread with remarkable tensility.

After more than a decade CJLI gradually went to sleep as the spare time I used to prepare and publish each issue was subsumed by the increasing proportion of my 'spare time' on weekends spent working on Mutual Life business.

During these years I became known by and acquainted with various media people who had a regular or occasional interest in the life insurance business. I was contacted regularly by such persons, usually on the basis of being an unnamed and often unacknowledged source by journalists seeking information/perspective/story angles/quotes.

My experience with the financial media over the years as a source, an observer and an informed consumer helped shape my less than worshipful attitude to those to whom I have often referred in these columns as members of the financial services paparazzi.

In this connection my favourite anecdote involves a piece written by a journalist at the (Toronto) Globe and Mail's Report on Business. The deadline was looming for this reporter and an editor was pressing for copy and I was called for help. When the article appeared the next day it was the only occasion in my life I became three people: an "informed observer", an "industry expert" and a "life insurance industry executive".

All of the foregoing is by way of being a preamble indicating that my opinion of the financial media is informed by direct experience over many years.

The leading exception to my scepticism involving the financial services paparazzi and the financial media in particular is financial journalist and columnist James Daw of The Toronto Star, Canada's largest circulation newspaper. After a career of several decades with The Star he is taking early retirement at the end of this month, an occasion that deserves to be marked.

I have known Jim Daw during most of his career (and mine). I made it a point to read his work. I have not been reluctant to offer my opinion publicly and privately that I regard him as the best informed newspaper journalist in English Canada on the subject of insurance and the insurance business -- both life and p & c.

Based on experience, hard work and study he acquired a thorough understanding of what is so often missing in those whose contact with the insurance business is brief and callow: an understanding of how it really works and why it works the way it does. Indeed he has an understanding superior in its breadth to that of many of the insurance executives I have known.

Just a couple of examples: Daw co-authored an award-wining examination of a subject that was opaque to many in both the media and the life insurance business: the financial collapse of Confederation Life. His annual survey of out-of-Canada health insurance is not only superbly useful but unique in its comprehensiveness and reliability. He was the journalist who from the outset (publicly) understood the potential significance of the class action on behalf of London Life par policyholders against Great-West. Since the 1990s Daw consistently paid attention to the subject in print up to and including the judgement ultimately handed down recently in favour of the par policyholders [see "Great-West 0, par policyholders 1", column No.118 on RickardsRead.com].

Over the years I have respected Jim Daw's integrity, his high standards of reporting and writing, the quality of his research and his informed opinions and perspective. During my decades in the life insurance business as an executive, a writer and an editor there has been no Canadian journalist for a mainstream publication writing about the insurance business who equals the consistent superiority of his work.

I salute James Daw for a journalistic career of fine work and genuine merit -- and so should the life insurance industry, or at least those within in it who know enough about the reality of the business which employs them to recognize quality work.

In January 2011 Jim Daw will be joining on a contract basis the Insurance Bureau of Canada as a senior writer. He will be working initially on an examination of auto insurance systems around the world. The IBC has made a smart move.

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Alastair Rickard

RickardsRead.com

email: Alastair.Rickard@sympatico.ca