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General Insurance Newsletter Friday 29th October 2021

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Insurance News

Following regulatory action from theFCA, retailer John Lewis was forced to pull its Home insurance advert after the watchdog deemed it “potentially misleading”. The commercial first aired on 11 October, and on Wednesday, 27 October, the retailer posted on Twitter that it chose to withdraw it due to the regulator warning the provider it could confuse customers about insurance.

In further news...With regulated firms continuing to receive their invoices for this year’s FCA fees and levies, Premium Credit is offering businesses a finance facility to spread their fees over convenient monthly repayments rather than having to pay in one lump sum. This alternative payment method is designed to give firms greater control over cash-flow, allowing their cash reserves to work more effectively in other business critical areas.

Insurance Premium Tax has been kept at 12% in the Autumn budget. Chancellor,Rishi Sunak, delivered the document in which he flagged the borrowing is the “highest it has been outside of war time”. The spring 2020 budget was known as the ‘coronavirus Budget” and saw unprecedented borrowing to pay for lockdown. TheBritish Insurance Brokers’ Association (Biba), which has often attacked IPT as an unfair tax, welcomed the decision not to raise the levy.

Fidelis Insurance Holdingshad announced the opening of its UK trading floor, which will be known as the ‘Forum’. The new operation is located at 37-39 Lime Street, London EC3M 7AY. It will be a trading hub for Fidelis and its MGA platform, Pine Walk Capital.

Lloyd’shas announced it is joining the UN-convenedNet Zero Insurance Alliance (NZIA). The corporation stated that the move was part of its commitment to cross industry collaboration to mitigate and manage the impacts of climate change and support the speed of the transition to net zero. In joining the alliance, Lloyd’s commits to the transition all of its operational and attributable greenhouse gas emissions to net zero by 2050, at the latest.

Geo Specialtyhas broadened its UK Political Violence and Terrorism policies, widening the scope of its Business Interruption insurance to cover loss of profits even after the property has been rebuilt and reopened.

Broker Expois back this November, and Insurance Age is ready to welcome Brokers in a face-to-face setting once again. Taking place at the Coventry Building Society Arena (formerly known as the Ricoh) on 11 November, Broker Expo is the place for professionals to meet, get hands-on experience with latest products in the market and catch up with industry friends.

TheChartered Insurance Institute (CII)has reported that the median gender pay gap, gender pension gap and ethnicity pay gap at the organisation has continued to shrink in the last 12 months. The professional body detailed that it had a median gender pay gap of 10.06% in 2021 compared with 13.94% in 2020. Its median gender pension gap narrowed slightly to 10.66% in 2021 (2020: 11.16%), while its median ethnicity pay gap was 14.1% in 2021, the first year of external reporting of this figure.

Percayso Informhas launched a product designed to enable insurance businesses to “take back control” of their data enrichment, rating and quote manipulation strategies. The data intelligence provider explained that the product is available to Insurers, Managing General Agents and Brokers.

Q3 2021 results season is in full swing andWillis Towers Watson (WTW)has become the latest insurance business to reveal how it fared last quarter. All GAAP profitability metrics published by the company include the benefit of the $1 billion income receipt received as a result of the termination of the proposed Aon transaction during the third quarter of 2021.

In further news...Insurtech continues to catch the eye of investors, with capital invested in Insurtech start-ups surpassing the US$10 billion mark for the first time in any one year on record, according to the latest Willis Towers Watson (WTW) Quarterly Insurtech Briefing, covering the third quarter of 2021 (Q3 2021).

Insurance behemothsAXAandWillis Towers Watson (WTW)are among the first signatories of a United Nations-backed initiative designed to protect the ocean against the impact of climate change. Launched ahead of the start of the COP26 summit, the #BackBlue Ocean Finance Commitment, spearheaded by the Ocean Risk and Resilience Action Alliance (ORRAA), aims to encourage financial and insurance companies to incorporate ocean conservation in their business decisions.

Cyber risk is becoming increasingly more important and companies, Insurers and governments need to work more closely together on Cyber security, according to the findings of the 2021 AXA Future Risks Report. The global study measures and ranks changes in the perception of emerging risks via a survey of 3,500 risk experts and 19,000 members of the public.

TheAssociation of Consumer Support Organisations (ACSO)criticised car Insurers for making considerable additional profits during the COVID-19 pandemic. A study commissioned by the ACSO, titled Profiting from Pandemic Premiums, concluded that Motor Insurers have benefited from a windfall of £118 per policy due to the reduced number of claims during the pandemic. Data from the ABI showed that the number of claims settled fell by nearly 20% last year. Meanwhile, Motor premiums decreased by just £25 in the last 18 months.

QBEhas developed a tool to provide a risk management framework for customers to better assess environmental, social and governance (ESG) risk. Developed by QBE’s Risk Solutions practice, the tool provides a template sustainability policy and ESG framework to help smaller and medium sized enterprises identify, monitor and manage a range of ESG issues that may impact on their business.

Global commercial insurance prices increased 15% in the third quarter of 2021, according to theGlobal Insurance Market Indexreleased by Marsh, the same rate of increase recorded in the previous quarter. While this is the 16th consecutive quarter of increases, the rate of increase continues to moderate in many lines of business and in most geographies. This trend may suggest that pricing increases peaked in the fourth quarter of 2020, at 22%.

Two thirds of drivers (65%*) would initially call someone other than their Insurer following a collision according to a poll by the newly launchedAAAccident Assist. While many will eventually contact their Insurer at some point after the incident, the poll shows that drivers will often seek help and assistance from other sources first before calling their insurance company.

Nearly three in four UK adults (74%) are concerned by rising inflation and the cost of living, according to research byAvivawhich shows the sandwich generation aged 45 to 64 bearing the brunt of anxiety. With annual inflation having recorded its largest ever monthly rise from July to August[1], 79% of people aged 45-54 are worried about spiralling living costs, including two in five (40%) who are very concerned.

Premium Credithas been named as the ‘Credit Provider of the Year (Commercial)’ at the 2021 National Credit Awards.

AXIS Capital Holdings Limitedhas announced financial results for the third quarter ended September 30, 2021. For the third quarter of 2021, the Company reports: Improvement of 4.8 points in current accident year combined ratio, excluding catastrophe and weather-related losses to 87.6%, compared to the prior year, operating income of $1 million, or $0.01 per diluted common share and pre-tax catastrophe and weather-related losses, net of reinsurance and reinstatement premiums, of $250 million, or 20.7 points.

HSB Engineering Insurance Limitedhave been awarded 'Best Insurance Employers 2021: Five star employer - SME' (Ranked: 8th) in the Insurance Post Awards.

As financial results season rolls on,Arthur J Gallagher (AJG)is stepping up to the plate to reveal how it fared in Q3 2021. It was a strong quarter for the group which saw its core brokerage and risk management segments combined post 17% growth in revenue, of which 10% was organic revenue growth.

Swiss Rehas released its performance figures for the first nine months of 2021, with the group’s Property and Casualty businesses cited as a driver during the period. “Thanks to the group’s sustained focus on portfolio quality and disciplined underwriting, our Property and Casualty businesses delivered excellent results in the first nine months of 2021,” said Group Chief Executive, Christian Mumenthaler.

Direct Line Grouphas released a report detailing its efforts in promoting Black inclusion in the workplace. The Insurer also pledged to report its ethnicity pay gap beginning next year. The report, the Insurer said, is part of its initiatives to promote diversity and inclusion, which include the introduction of new recruitment principles and setting targets to increase Black representation in leadership.

We are incredibly proud of the IDEX Lands End to John O'Groats bike ride team, who completed their 980 mile charity ride last month.

Raising over £28,000, the ride was in support of the mental health campaign, 'Fight For All The Feels' who help children and young people battling mental health issues. 

If you'd like to support this incredible campaign, follow the link where you can make a small donation:

Mergers & Acquisitions

Aston Larkhas bought Birmingham-based BrokerBainbridge Collinsfor an undisclosed sum. The move follows the consolidator’s purchase of Absolute Products in Leighton Buzzard last week. Bainbridge Collins, which specialises in the mid corporate sector, was formed over 30 years ago and is led by Managing Director and Founder Cyril Gallagher.

NFPhas bought Wolverhampton-basedKGJ Insurance Services Groupfor an undisclosed sum. The business detailed that KGJ is a Commercial Lines Broker providing a range of exclusive scheme facilities as well as access to restricted markets through various wholesale brokerages. It specialises in Marine insurance and provides coverage for all types of boats, including speedboats, yachts of all sizes, other luxury watercraft and coverage to the Marine trade sector.

Global Risk Partners (GRP)has acquired a minority stake in dental and life science specialist BrokerAll Medical Professionals Ltd (All Med Pro). Stephen Ross, GRP’s Group Head of M&A, explained that All Med Pro is a member of Hedron Network, and taking a minority stake is a first for GRP since Hedron was acquired from Marsh earlier this year.

The revived sale of Exor’sPartnerReto French mutual InsurerCovéais now moving along, with a signed Memorandum of Understanding under which the camps would enter into a definitive agreement once the required consultation with Covéa workers councils is completed. In a joint release, Covéa and PartnerRe’s parent said the proposed transaction would be worth US$9 billion (around €7.7 billion) in cash, based on a consolidated common shareholders’ equity value of US$7 billion. It was noted that the consideration would not include PartnerRe-issued preferred shares.

Movers & Shakers

Legal indemnity BrokerLawSurehas announced key appointments within its leadership team. The recent changes will see Managing DirectorBrian Hallstep into the role of Executive Chairman. He will be succeeded byMandy Brown, who will take the reins as Managing Director. The Broker stated that Brown brings a wealth of experience to her new role, having been involved in the business for years.  

Chris Wallacehas been appointed Executive Director ofQBE’sUK insurance business, effective 1 November. He takes over the role fromCécile Fresneau, who was promoted to run the European Operations insurance division earlier this year, and into whom Wallace will continue to report.

To further develop its data analytics expertise, Carbon Underwriting Limited has appointed Madu Gadzama as data analytics engineer and Edward Saunders as data services associate. Both Gadzama and Saunders will put their expertise to use in the development of Carbon’s data analytics platform, Graphene.

Aviva plchas announced the appointment ofMartin Strobelas Independent Non-Executive Director of the Company with effect from 22 October 2021. Martin was most recently Senior Independent Director of RSA Insurance Group plc. Martin has held a number of senior roles during his career including as Group CEO of Baloise-Holding AG, Operating Partner of Advent International and with the strategy consulting firm BCG. Martin is currently Vice Chair and Lead Independent Director of Partners Group Holding AG and Deputy Chair of MSG Life AG.

Global travel InsurerCover-More Grouphas appointedConor Breslinas its new Group Chief Information Officer (CIO) to accelerate its digital transformation as international travel starts to resume. Breslin is skilled in digital transformation, enterprise architecture, information security, IT service management and IT strategy alignment. He joined Cover-More from Provident Financial Group and Vanquis Bank in the UK, where he served in the same role.

All information provided in this Market Digest has been gathered from multiple General Insurance Media sources and individual company press releases.