Laya in rude good health after scare

FRESH FROM his firm’s recent rebrand, the head of Laya Healthcare enters the room with a spring in his step. In fact, as we get down to discussing the nuts and bolts of the health insurance industry, I find myself thinking that Donal Clancy wouldn’t look out of place in an advertisement for health insurance.

A youthful 49, he lives in Cork with his wife and four children, and cites kayaking as his favourite hobby.

But while Clancy may be an exemplar of the good life, he is also a serious businessman. He is a major figure in the world of Irish insurance as managing director of Laya Healthcare, or, as it’s better known, the company formerly known as Quinn Healthcare, itself a revamped version of Bupa Ireland.

Clancy has spent most of his career in the health insurance sector. After studying computer science at UCC, he moved to Britain to work for the multinational company ITT in the area of engineering support.

After a two-year spell in Vienna and a year travelling around the world, he joined VHI in Dublin in 1991, staying with the State health insurer for five years before moving to Cork with Bupa when the global health insurer entered the Irish market.

Along the way, Clancy migrated from IT and began making his way up the executive chain, taking up a position as director of operations with Bupa in Ireland. This led to the top job at the company, a position he held for the duration of the Quinn tenure.

For him the shift in career was seamless. “There wasn’t really a divide for me. I suppose, instinctively, I had a broader sense of the company. When you worked in IT, you had to produce and deliver services that were relevant to business. You’re part of a business team, so doing something for technical elegance was not an option,” he says with a characteristic smile.

But despite his chirpy demeanour, the last two years have been stormy ones for the company. On March 31st, 2010, the financial regulator Matthew Elderfield appointed an administrator to Quinn Insurance, amid concerns about the insurer’s solvency. It emerged that subsidiaries of Quinn Insurance had made guarantees in relation to the Quinn group’s assets.

How much did Clancy and other senior management know about what was happening?

“It went to the High Court at 11 o’clock, and we were told at noon. That is genuinely the first we knew about it,” he says.

As the managing director of Quinn Healthcare, was it not his duty to know what was going on?

“On a personal basis I was very disappointed myself I didn’t know. We had been asking certain questions and we got answers and we had no reason to doubt them. So that was a shock. Hindsight’s a great thing. In hindsight, when we look at the information, and got our information, the answers weren’t as clear cut maybe.”

Clancy stresses that Quinn Healthcare was never in administration. Its underwriter, Quinn Insurance, was.

“From an underwriting process Quinn Insurance were underwriters for Quinn Healthcare. Just as Bupa were the underwriters for Bupa. Fundamentally they’re the ones who take the risk. We manage the business for them, the operations, make sure it’s run from a customer point of view. But if you’re looking at solvency, at who is taking the risk, it’s Quinn Insurance Limited taking on the risk, as Bupa Insurance did in the past.”

Within a few hours of the announcement, the company went into crisis-management mode. “Within an hour we were on to our legal team. We were very lucky in that regard. We got legal advice, issued press releases. We had to communicate to our customers and to our providers that, from a Quinn Healthcare point of view, we were not in administration. All of the providers had to be contacted to tell them, ‘You will get paid’.”

He believes communicating with staff was also a key factor in sustaining the business. “We had been through this when Bupa announced they were withdrawing from the market, and we had told staff what was happening straight away. At the end of the day, it’s about people’s jobs.”

As the turbulence passed, the focus at Quinn Healthcare shifted towards strategy, as the importance of retaining customers became a primary concern.