James Chalmers: What was your reaction to being named the Lex McKeown Award winner?
Lach McKeough: I was taken aback. I was really surprised. I wasn’t in any way expecting it and it was the last thing on my mind. I feel very honoured to receive this award. There are some wonderful industry names on that trophy, names like [former NIBA president] Frank Earl, and I feel very privileged and very honoured to be on that list.
My career has been fantastic. I’ve had the privilege of working with some wonderful people. People who know me know I’m not usually caught for words but when [current NIBA president David Wyner] handed me that trophy I certainly was.
JC: Looking back at how much Austbrokers has grown since you began, what sense of pride do you feel? And what have the highlights been?
LM: I don’t think anybody thought that it would grow the way it did. When we started in 1985 it was just me and a part-time staffer.
I think it’s been a fantastic ride. I was very fortunate to have the opportunity to build it like I did.
The ultimate risk was to float the company seven or eight years ago. It was quite daunting.
I was talking to [Steadfast CEO] Robert Kelly recently and I asked him what thoughts were running through his head in the moments before their recent float. Because when you float on the ASX you have a little room and you can bring 30 or 40 people along. It’s 11 in the morning and they have screens where you can watch the stock debut.
When we floated I was standing there and thinking to myself ‘What am I going to do if this stock goes through the floor?’ Do you apologise and say you’ll try to do better next time or do you make a beeline for the exit?
Whilst I’ve been the Austbrokers coach, if you like, I’ve had a great team working with me. It’s not the Lach McKeough show by any means. It’s been a team effort, no doubt about that.
I’ve also thoroughly enjoyed the opportunity to work with our partners.
There have been all these businesses that have had great success and it’s been great to work with these people and see their own growth and success. I’ve had some businesses with me for 28 years and it’s enormously satisfying to watch them grow and do well.
If these business do well than Austbrokers does well. That’s been a highlight as well.
JC: How would you describe the changes in the insurance broking industry in your time?
LM: I started in 1969 and basically when I started all the underwriting was done directly. All the underwriters had branches and local staff. At that point there were only a few suburban brokers (and I say that with the utmost respect, only to differentiate them from international brokers).
That started to change and the underwriters started to withdraw their operations from the regions and focus on the capital cities. They sold their books to their reps and that’s how it started.
Now, in the last few years, we’re seeing the emergence of the AR. If you’re a smart young Turk and you want to chance your arm how do you do it? You can buy into an existing business and certainly that is still occurring or you can become an AR.
JC: How has your own view of the industry changed since you entered it? How does that correlate with the wider perception?
LM: I did my high school certificate and was leaving school wondering what to do. I had thoughts of going into banking or to university. I heard about these insurance inspectors and that these guys got company cars. For an 18- or 19-year-old, getting a car sounded pretty good.
It’s a great industry but it’s unfortunate that it’s not a sexy industry. People aren’t leaving university wanting to get into insurance. We in the industry have to promote it and we’ve got a responsibility to do that.
Without insurance industry stops. Without insurance the banks are not going to lend any money. It is at the core of commerce but that is often lost. It isn’t in the rhetoric.
It’s an industry where if you have a go you can certainly do well.