BACKGROUND

EVEN during the depths of the recession, the buoyant oil and gas sector meant Aberdeen’s streets were still lined with Aston Martins, Bentleys and Ferraris – and insurance broker Iain Henry has just the right policies for the city’s supercar-owning fraternity.

As part of his diversification strategy, the managing director of Granite City-based brokerage Central Insurance snapped up Kendal-based sportscar insurer Peart at the end of 2008 for £1.5 million, driving the Scottish business away from its traditional energy sector heartland.

Yet insuring high-performance motors hasn’t made Henry rush out and splash his own cash on a new Lamborghini or Porsche.

“I don’t think it would portray the right image to turn up to a client in a flash car, particularly in the current economic environment,” admits Henry. “I like motors, but I don’t have any fancy ones. I’m content to admire our clients’ nice cars instead.”

That diversification strategy led Central to open a £1.2m operation in Glasgow 18 months ago and Henry is pleased with the progress being made by the firm.

“Our Glasgow office has written about £4m worth of policies since it opened, boosting our own turnover by about £500,000,” he explains. The firm has built a team of 13 staff in Glasgow, led by regional director Tom Aldridge, who – while working for a previous broker – once insured the legs of pint-sized Australian singer Kylie Minogue, right.

Moving into the Central Belt has been accompanied by an expansion into other insurance markets, with the firm targeting life science companies, tourism firms and care services.

Most of the growth already posted by the office has come from the construction and general business sectors, Henry says, but the firm has now teamed up with FTSE 250 insurer Hiscox to offer a dedicated cover-all policy for Scottish charities.

The new policy offers cover for everything from property through to event cancellation and protection for trustees. Central already has about 30 charities as clients, including Alcohol Focus and cancer support organisation Clan.

“There are about 45,000 voluntary organisations in Scotland and we’ve identified a need in the market for this kind of product,” observes Henry. “The amount that charities spend on policies can vary from £500 up to several thousand but we’re talking about a multi-million pound market here.”

Taking a share of such a big market would help to swell turnover at Central, which is already on the rise. Turnover in the year grew by 4.4 per cent to £7.2m, with pre-tax profits edging down to £1.9m from £1.2m, dented by the cash spent on the new Glasgow office.

But Henry believes the expansion strategy will have started to pay dividends when the company reaches its year-end at the close of this month. He expects revenues to have grown to between £8.5m and £9m and for profits to be up too. The oil and gas sector now only accounts for between 65 per cent and 70 per cent of the company’s business.

The firm’s gross-written policy figure is also expected to top £55m, which Henry claims will push the company into the top ten largest brokerages in the UK.

That figure has risen from £40m at the beginning of 2008, when Henry led the £13m management-buyout (MBO) of the company from its 72-year-old chairman and founder, Alistair Ballantyne. Initially Henry held 45 per cent of the company’s shares following the MBO but that figure fell to 40 per cent in May following the takeover of fellow Aberdeen firm Collins, Halden & Burnett (CHB).

Following that deal, Henry’s seven partners hold the remaining shares in the business, which was founded in 1973, with two directors joining from CHB under the part-cash, part-shares £2.6m deal.

Takeovers are still on the agenda for Central; Henry says the company switched banks – from Royal Bank of Scotland, which backed the MBO, to Australian lender Macquarie Bank – and has cut its debt from the MBO in half to about £3m.

“Macquarie just understands the brokerage sector better,” says Henry. “Plus it gives us access to an acquisition fund, which we didn’t have before.”

While Henry remains tight-lipped on the size of the takeover warchest, he says he is looking at options, which could involve a move into Edinburgh. The firm already employs about 110 staff – including some 85 in Aberdeen and about 11 in Kendal – and is set to expand further as it continues to diversify into new markets.

While driving the firm forward is obviously a key focus for Henry, the Rangers supporter hasn’t forgotten his roots.

“Aberdeen has been good to us,” he explains, “and the oil and gas industry has been good to us. Our clients have told us that our reputation is still important to them and so we can’t forget customer service – it’s not just going to be growth for growth’s sake.”

Expansion for Central is a long-term game, something that’s familiar to Henry as a marathon runner. If all went to plan over the weekend, this morning he’ll be recovering from the Glasgow half marathon. But even that epic run is just a warm-up for the real challenge, when Henry faces the New York marathon in November.

“Training is going OK,” Henry hesitates. “It’s always difficult to find the balance with work but I think it’s important to keep active. I can’t say I’m in love with running but it does keep me fit and gives me good exercise.”

Henry is more excited about golf’s Walker Cup, which tees off on Saturday at the Royal Aberdeen, one of the courses at which he is a member.

“It’s great for Aberdeen – and for Nairn when it hosted the tournament back in 1999 – because it brings real attention to the North-east. It’s the same with Donald Trump’s development – whether you love it or loathe it, it’s bringing the focus on Aberdeen, which is a good thing for local business.”