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Claims Newsletter Friday 29th July 2022

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Claims News

Sedgwick announced that their UK Repair Solutions division has achieved carbon-neutral status by the British Standards Institution.

LexisNexis Risk Solutions has launched a contributory claims database that will soon enable Insurers to view all the past claims for an individual across Home and Motor. LexisNexis Precision Claims is intended to support risk assessment at all points of the customer journey by enabling Insurers to access highly granular claims data gathered from across the market through one platform.

Insurance claims solutions business S&G Response has expanded its operations within the North of England, opening a new 4,000 sqft office in Halifax. The office opened in May 2022 and created an initial 20 new jobs in Halifax, with plans to increase to 50 over the course of the year.

​UK Motor claims inflation is expected to accelerate in 2022, insurance advisory firm WTW has warned. WTW (previously known as Willis Towers Watson) has conducted analysis that indicates that a slowdown in the average time taken to settle claims, due to disruption caused by the pandemic, has until recently acted as a temporary brake on claims inflation. Motor claims payout inflation increased by more than 6% during 2021, taking the average cost per claim to £5,349, according to WTW’s latest Claim Metrics benchmarking data.

HCML, the provider of rehabilitation treatment and case management solutions, has expanded its corporate services division in response to increased demand. The company has seen a 78% increase in the number of new customers accessing its services since the start of 2020, and with a 30% rise in the number of employees being screened per month, it has further developed its occupational health and employee wellbeing services.

​Motor insurance premiums appear to be on an unpredictable path after prices shot up in January due to regulatory changes, according to the latest Motor insurance price index from Consumer Intelligence. The average Motor insurance premium has increased 7.8% over the first five months of 2022, with the typical policy now costing £786 following the introduction of new rules to tackle the practice of ‘price walking’ at the beginning of this year.

​The British Insurance Brokers’ Association (BIBA) has confirmed that Lorega’s loss recovery product will continue to be exclusively offered to its members. Lorega, a Managing General Agent and policyholder claims expert, offers a range of products through the BIBA Loss Recovery Scheme, including loss recovery insurance and Lorega 10.

In further news...The British Insurance Brokers’ Association is targeting a return to verbal communication between Insurers and Brokers within the claims process to “cut down the misunderstanding rate”.

Home insurance provider Urban Jungle has revealed that bicycle theft claims have increased significantly over last year. Newly released claims data from Urban Jungle shows that claims for bike thefts between January and April 2022 increased by 126% compared to the same period last year. The Allianz Broker Voice Survey found that over two-thirds of “claims-handling”, Brokers said they spend at least three-quarters of their time dealing with simple and straightforward claims, as opposed to complex or high value claims (over £100,000).

The trial in the case of Greggs v Zurich drew to a close last week, in a shortened process which forwent opening statements and cross-examination of expert witnesses. The case concerned a Business Interruption claim made by Greggs for 2235 insured locations throughout the UK. The total value of the claim is currently set at £150m, significantly more than either Greggs’ original claim of £100m, or the payout from Zurich to date, which the Insurer argues is subject to a limit of £2.5m.

The Various Eateries v Allianz trial, which has now come to a close, concerned a £16m Business Interruption claim made by Various Eateries for losses incurred as a result of Covid-19 restrictions that has been rejected by Insurer Allianz.

An increase in claims numbers are expected following the wildfires in the UK, but experts urge more preventative measures. Wildfires have surged across the UK igniting houses as temperatures hit a record 40 degrees Celsius this month, beating the high of 38.7°C set in 2019, with the Met Office putting in place the first ever red extreme heat warning.

A man from London has been sentenced for setting up hundreds of fraudulent insurance policies on behalf of other people, by using false details and compromised bank accounts. Rodney Bruce Van der Puye, 34, of Cator Street, Southwark, pocketed around £50,000 in just over 15 months by acting as an illegal intermediary, also known as a ‘ghost Broker’. Van der Puye targeted some of the UK’s biggest insurance companies, using his, his mother’s and unknowing members of the public’s identities to take out cheaper Motor insurance policies for his ‘customers’.

Cyber insurance specialist Coalition has raised an additional $250m to accelerate its growth, power international expansion, and broaden the services Coalition offers to help organizations manage digital risk. This funding round closed in June with participation from Allianz X, Valor Equity Partners, Kinetic Partners and other existing investors, increasing Coalition’s valuation from $3.5bn to $5bn.

Nordic Capital and Risk Point Group have entered an agreement for Nordic Capital to acquire an interest in Risk Point (subject to regulatory approvals). The investment is aimed at helping accelerate the group’s global growth ambitions and supporting the company in achieving its long-term strategy. Risk Point Group is a specialty insurance MGA based in Copenhagen with offices in Stockholm, Oslo, Helsinki, Amsterdam, Frankfurt, Zurich, Madrid, London and New York.

American Family Insurance, the US Property and Casualty insurance specialist, is partnering with Tractable to apply its artificial intelligence solutions, specifically using Tractable as part of its claims subrogation settlement process.

Motor insurance provider Zego has withdrawn job offers it had extended and will make 17% of its staff redundant after facing increased costs. The redundancies, which were announced to staff by Zego CEO Sten Saar, will be concentrated in the B2C part of the business with engineers, product, and research staff among those who are being let go, though other departments will also be affected.

Aircraft leasing giant Aercap has launched a $3.48bn (£2.93bn) lawsuit against its Insurers, as it seeks to recoup losses incurred by the seizure of 141 planes by Russian airlines following Russia’s invasion of Ukraine earlier this year. Aercap, which is also claiming on the behalf of other Insurers covered under its policy, says that is owed $3.5bn by AIG and other Insurers that have subscribed to the ‘all risks’ section of its policy.

Insurer Ecclesiastical is facing criticism that it cares more about its reputation than child sexual abuse survivors after it paid out more for revealing the identity of a survivor, than it has for the abuse the survivor suffered. The settlement for the mishandling of the claims resulted in a payment from Ecclesiastical of £30,000 plus costs. The Insurer has also apologised to Gilo, a survivor of church abuse and co-editor of Letters to a Broken Church, for breaching his confidentiality.

The UK Motor insurance market achieved an underwriting profit in 2021, largely due to post-pandemic factors, including low levels of commuting resulting in fewer claims, according to EY. In its latest UK Motor Insurance Results, report EY said Motor insurers last year recorded a net combined ratio of 96.6%, which followed a NCR of 90.3% in 2020 – the industry’s best ever result.

AXA has extended its partnership with Rock Insurance in a deal that will see the company underwrite a number of the group’s policies including Jet2, Onthebeach, Travel Republic, Insurefor, Leisure Guard and Big Blue, among others.

The Chartered Insurance Institute’s New Generation Insurance Broking Group has called for the regulator to make it mandatory to have qualifications to advise clients on coverage. It follows the 2021 group publishing a report stating a knowledge gap exists in the broking profession that is resulting in many customers not receiving the highest level of professional advice.

Gallagher Re and Africa Re, the pan-African reinsurance company, are joining forces to strengthen the financial resilience of African countries against a broad range of climate, crisis and disaster risks.

Challenger credit card Yonder has added no-excess worldwide Travel insurance to its membership perks underwritten by AXA.

The rising cost of living has led to a sharp increase in bogus claims, according to Insurer Zurich UK. The company said it identified £4.2m worth of fraudulent Property claims between January and May this year, a rise of 25% on the same period in 2021. The figure equates to £40,000 per working day, Zurich said.

A decision by the Court of Appeal to allow more than 200,000 claimants to pursue damages for the collapse of a dam in Brazil could have major implications for UK-headquartered multinationals with overseas operations, according to one legal expert. Emilie Jones of Pinsent Masons said the ruling was “an illustration of the English courts’ openness, in appropriate circumstances, to hear mass claims against English parent companies arising from incidents involving their subsidiaries abroad.” Her comments came after the Court of Appeal overturned a High Court decision that struck out the claim as an abuse of process that “would lead to utter chaos” in both the English and Brazilian courts systems.

Mergers & Acquisitions

Ardonagh’s Managing General Agent segment Geo Underwriting has bought loss recovery insurance MGA and assistance specialist Lorega. It will continue to be led by Managing Director Neill Johnstone and operate independently under the Lorega brand, Geo confirmed. The transaction marks an exit for private equity house Alcuin Capital Partners which backed Lorega’s management buy-out in February 2016.

Law firm Clyde & Co’s merger with UK and Ireland law firm BLM has gone live. BLM’s teams have become part of Clyde & Co’s global insurance practice, with the majority joining its Casualty insurance practice. Other sizable groups have joined Clyde & Co’s Professional Liability, healthcare and business advisory teams.

Just Travel Cover, the Leisure Travel Insurance specialists and insurance product and service provider, has acquired the Travel insurance and scheme specialist business Alpha Underwriting from CPP Secure. The deal sees Just Travel Cover grow its Broker network and provide Alpha’s general insurance Brokers with access to its panel of insurance products.

WTW has acquired Butterwire, a Fintech provider of data analytics, artificial intelligence and machine learning platforms. To strengthen its capabilities in delivering climate risk analytics to organisations around the world.

PIB Group has continued its expansion in the Spanish insurance market with the acquisition of the Broker Confide Insurance and Reinsurance Broker SA. Upon completion of the transaction, Martín Navaz who is the current President of Confide, will assume the position of CEO of Spain for PIB Group. Brendan McManus, CEO for PIB Group commented: “We are attracted to Confide because of its professionalism, excellent reputation, and relentless commitment to customers.”

Charles Taylor has acquired V+B Group, a maritime assurance and surveying company consisting of three businesses: Verschoor & Bras BV, Marinco Survey BV and Marintec Expertise BV. Headquartered in Rotterdam in the Netherlands, V+B Group provides end-to-end survey solutions to the European maritime market ranging from claims investigations to assessments and inspections, with a particular focus on the Amsterdam, Rotterdam and Antwerp area and the Northern Netherlands region.

Howden has acquired Wallace McLean to strengthen its New Zealand expertise. Wallace McLean was founded in 2001 and has corporate clients in New Zealand and internationally. Its team has various specialisms including Property, Agriculture, Shipping and Freight Operations, Bodies Corporate, Self Storage, Film and Entertainment, Retail and Distribution, and Engineering and Professional Services.

German broking consolidator MRH Trowe has completed three bolt-on acquisitions. These are WRV GmbH, based in Scheden in lower Saxony, a specialist insurance Broker serving clients in the Construction trade sector; Lech Assekuranz Versicherungsmakler, an Augsburg-based Property Management and Real Estate Broker; and increased its equity stake in H+W Financial Solutions Group GmbH, thereby becoming the majority shareholder in the company which has been part of the Group since 2012.

Movers & Shakers

Morrish Solicitors Associate Oonagh McCurry has become a member of the Law Society Clinical Negligence Panel. The panel is a recognised quality standard for legal practitioners representing claimants in clinical negligence matters. The panel consists of leading Solicitors supporting victims of clinical negligence, handling some of the most demanding and high-value cases.

Allianz Commercial has promoted Margaret Scott as Director of Claims Strategy and Customer Experience and Lee Watts as Director of Technical Claims. As Head of Claims Strategy and Customer Experience, Margaret has led transformation in areas such as data, digital technology, agile and workforce planning to ensure that the Allianz claims proposition is well positioned to support future trading. Prior to that, she led the supply and experts team. As Head of Technical Claims, Lee remodelled the teams’ structure and approach, adapting the Allianz proposition to an increasingly complex claims environment. Over the last two years in particular, he led the Allianz response to Covid-19 Business Interruption claims.

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