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60 seconds with… Tim Johnson, chief executive, Paymentshield

How badly has the payment protection insurance mis-selling scandal hurt the reputation of protection?

It has affected it in terms of new business sales. It’s incredibly frustrating because it’s a product that people need. It’s a crazy situation where the public don’t trust it but it’s a valuable product. I’m sure that wasn’t the intention when this furore started. However, it has not affected retention levels so those who have a policy aren’t cancelling it.

Why did you decide to cut commissions for brokers who have dormant accounts?

Lots of other providers already do it, even though it has been portrayed as only Paymentshield – that’s not the case. The rationale is that we pay market-leading commissions already and for those who have dormant accounts, there was a deliberate contractual agreement that says if you don’t support Paymentshield, commissions will be cut. But the point everyone seems to miss is that if those brokers become supporters again, we’re more than happy to put the commission back up.

Is your focus more on the direct-to-consumer channel or brokers?

There is a misconception that this business has been built on direct sales. We have a tiny amount of direct business and it is often through a third party call centre so even that isn’t direct to consumer. We’re not a big direct player and it’s been slightly taken out of context. Until I took over Paymentshield I was a general insurance broker for 20 years so I’ve always been supportive of brokers. I’ve got a personal view of the supply chain and I’m fully in that camp.

Do you have any secret talents?

When I was a child I used to do a lot of birdwatching and I can recognise hundreds of birds by their shape, size or song.

Which three people would you invite to a dinner party and why?

Mohammad Ali because he transcended sport, Barack Obama to get a feel for what it’s like doing the biggest job in the world and Henry VIII because he invented his own religion and did a lot to shape the UK.

What book are you reading?

Jonathan Livingston Seagull by Richard Bach.

Interview by Samuel Dale


Johnson Fleming is a finalist at UK Pensions Awards 2016

The UK Pensions Awards shine the light on excellence and recognise the advisers, providers and investment managers that offer the highest level of innovation, performance and service to occupational pension schemes and their members. This year’s awards looked at advisers and providers across 31 different categories and were rigorously judged by a panel of senior […]


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  • Alex Murphy 8th May 2012 at 10:14 am

    As the head of marketing for The Source, I can certainly sympathise with Tim’s initial point – the miss-selling of PPI has caused some real problems. We enable brokers and IFAs to sell MPPI which is a separate and valuable product, but it has no doubt taken a hit as a result of the much-maligned PPI.

    On the subject of cutting commission to dormant accounts, whilst Source Insurance do not do this, I can verify Tim’s statement that indeed many companies do cut commission and the frequent vilification of Paymentshield is perhaps a little unfair if you don’t also take into consideration all the other companies who work with a similar model, so potential customers can give such criticisms context.

    At Source Insurance we don’t actually don’t cut commission, neither do we cut trail commission should a broker choose to leave the industry, but different companies need different models to remain profitable, and we’re happy to say this works for us and for the many mortgage brokers and IFAs who support us.

  • Ben 1st May 2012 at 7:19 pm

    Commission of 27.5% is not market-leading, it is on par with many; several providers pay 30% and still offer better premiums.
    No real reason to cut commissions just because you can and others do it, or to bribe brokers to use you again. Offering to up commission rate for brokers giving you business again is a bribe. Most brokers lost faith in Paymentshield previously and this was another bad PR move.