General Insurance Newsletter Friday 24th March 2023

Insurance News

Lloyd’s has delivered a £2.6bn underwriting profit for 2022, up from £1.7bn the year before. The marketplace had confirmed a combined operating ratio of 91.9% for 2022 in a trading update earlier this month. It had also detailed a 19% year-on-year hike in gross written premium to £46.7bn. (Emmanuel Kenning, 23/3/2023, Insurance Age, 'Lloyd’s confirms £2.6bn underwriting profit and targets £56bn GWP in 2023')

In further news...Lloyd’s of London has confirmed that it has limited exposure to the banking crisis spurred by the collapse of Silicon Valley Bank and the takeover of Credit Suisse by rival UBS. According to Chief Financial Officer Burkhard Keese, the fallout won’t put Lloyd’s positive investment outlook at risk. Little impact is also expected from the underwriting side. (Gia Snape, 24/3/2023, Insurance Business UK, 'Lloyd's has 'limited exposure' to Credit Suisse, banking turmoil – CFO')

Ardonagh has increased its income by 30% to $1.5bn (£1.23bn) and adjusted Ebitda by 22% to $476m in its financial results for the 12 months ending 31 December 2022. The group stated that its mergers and acquisitions pipeline remains active with more than 70 transactions, and the annualised value of the pipeline is over $100m of earnings before interest, taxes, depreciation and amortisation. (Sophie Locke-Cooper, 23/3/2023, Insurance Age, 'Ardonagh reports adjusted Ebidta growth of 22% to £389m')

Hagerty, a car insurance provider, has launched its private client service, which can be sold through brokers who have customers with a vehicle, or vehicles, worth £250,000 or more. The product is designed especially for classic and collector vehicles owners. Hagerty private clients will have an allocated team to manage the insurance. (Sophie Locke-Cooper, 22/3/2023, Insurance Age, 'Hagerty launches private client service')

The Financial Conduct Authority’s approval times for new firms is worsening in 2023, according to latest data, bucking a trend that has seen improvements in key broker areas, including for approved person status and appointed representatives. The regulator targets new firms to have their applications approved within six to 12 months, even if the forms are incomplete. FCA staff approved 97.8% of applications in the 2021/2022 year-period within the target timeframe. That figure has now declined to 91.7% for January and February 2023. (Saxon East, 22/3/2023, Insurance Age, 'FCA approval times worsen for new firms as overall picture improves')

The UK was hit by $900m (£732.6m) of economic losses from natural catastrophes such as storms and flooding in 2022, with insurance covering $800m of the total, according to Swiss Re. The economic damage was identical to 2021, but the insured element rose by $100m, the reinsurers calculated. This meant a protection of gap of 17% in 2022, which is better than the 24% seen in 2021. (Emmanuel Kenning, 22/3/2023, Insurance Age, 'UK insurance protection gap improved to 17% in 2022, Swiss Re says')

The Ardonagh Group (Ardonagh) has released its financial results for the 12 months to December 31, 2022 (FY22), marking five years since its establishment. In FY22, Ardonagh reported a $1.5-billion income, up 30% from $1.2 billion in the 12 months to December 31, 2021 (FY21). It also saw $476 million adjusted earnings, up 22% from $390 million in FY21. (Roxanne Libatique, 23/3/2023, Insurance Business UK, 'Ardonagh Group unveils latest numbers')

US specialist insurance provider Hagerty has launched its private client service in the UK. Designed for clients with vehicles and collections valued at over £250,000, the new offering will feature a dedicated team to manage vehicle collectors’ insurance needs. The product also comes with expert valuation of vehicles and added-value benefits such as ‘diminished value’ and ‘cherished salvage’. (Terry Gangcuangco, 23/3/2023, Insurance Business UK, 'Hagerty rolls out new specialist insurance product in the UK')

The Living Wage Foundation (LWF) has launched the Living Pension and Aviva is delighted to be one of the first UK employers to be awarded the Living Pension accreditation. The Living Pension has been developed as a voluntary pension savings target for Living Wage employers and has been independently calculated to provide enough income to meet every day needs in retirement. It will be open to all accredited Living Wage employers from March 2023. (youTalk Reporter, 23/3/2023, youTalk Insurance, 'Aviva is one of the first Living Pension employers')

Industrial insurer HDI Global SE has reported double-digit growth in gross written premiums and a further improved combined ratio for 2022, underpinned by strong performances in the Liability and Property lines, as well as robust new business growth in Specialty line portfolios. The company’s UK & Ireland branch contributed significantly to the positive overall result of the Hannover based multi-national industrial insurer that is part of the Talanx Group. (HDI Global SE, 21/3/2023, youTalk Insurance, 'HDI Global results 2022 show strong profitable growth, with UK & Ireland contributing significantly')

SEIB Insurance Brokers Ltd has chosen ARAG to provide breakdown assistance cover to the broker’s diverse range of motor clients, including horsebox and horse trailer owners, members of the clergy, and private hire drivers. ARAG has won the business after providing specialist cover for SEIB’s funeral vehicle fleet policies for several years. While SEIB’s Private and Commercial Motor business spans a range of market segments, the breakdown cover for equine transport, funeral vehicles and taxis inevitably presents unusual challenges for recovery operators. (ARAG, 23/3/2023, youTalk Insurance, 'SEIB picks ARAG for specialist motor breakdown services')

AXIS Capital Holdings Limited has announced that it expects to release financial results for the first quarter that ended March 31, 2023 on Wednesday, April 26, 2023 after the close of the financial markets. Albert Benchimol, President and Chief Executive Officer, Vince Tizzio, CEO Specialty Insurance and Reinsurance, and Peter Vogt, Chief Financial Officer, will host an investor teleconference, including a question and answer period, on Thursday, April 27, 2023 at 9:30 a.m. ET to discuss the first quarter results as well as related matters.(AXIS, 23/3/2023, youTalk Insurance, 'AXIS Capital to release first quarter financial results on 26th April 2023')

Last year, Aviva paid nearly 50,600 individual protection claims in the UK amounting to £1.07 billion. According to the insurer, 2022 was the third consecutive year that claims payments for individual protection claims exceeded £1 billion. Of all the individual protection claims that were lodged, 98.3% were paid last year – the highest claims paid rate reported by Aviva since it acquired Friends Life in 2015. (Terry Gangcuangco, 24/3/2023, Insurance Business UK, 'Aviva UK reveals individual protection claims figures')

Mergers & Acquisitions

Ballantyne Brokers has completed a management buyout to become 100% owned by staff. The buyout was completed from parent K2 Insurance Services, led by Founders Ross Ballantyne and Richard Spragg. Chief Operating Officer John Harris will lead the broker as it moves forward as an independent business. The broker operates in the UK, Europe, and North America. Product lines include Cyber, Professional Liability, Property and Casualty, Personal Accident, and Medical Malpractice. (Saxon East, 23/3/2023, Insurance Age, 'London market broker completes management buyout')

Castleacre has bought Merritt Insurance Services for an undisclosed sum. Jonathan and Franky Merritt, the Founders of Merritt, will work alongside the Castleacre team over the next two years as client policies are transferred. Both businesses are independent insurance brokers, that specialise in looking after clients with complex insurance requirements. (Sophie Locke-Cooper, 22/3/2023, Insurance Age, 'Castleacre buys private client insurance broker Merritt')

Imas has calculated that the value of UK general insurance distribution M&A dropped to £4bn in 2022 from £5.6bn in 2021. According to the mergers and acquisitions specialists, there were 107 transactions in 2022, down 27% on the record-breaking year before. Imas noted that despite the reduced number of deals sector consolidation is still “continuing at breakneck speed”. The figures show that there were 62 deals valued at below £5m, dropping by three transactions, and 45 above the threshold – a fall from 81 in 2021. (Emmanuel Kenning, 22/3/2023, Insurance Age, 'M&A slips back from 2021 record to £4bn in 2022')

Movers

The Financial Conduct Authority has appointed Therese Chambers and Steve Smart as joint Executive Directors of Enforcement and Market Oversight. The expansion of the leadership team follows on from Mark Steward announcing his plans last October to step down this year. Chambers has worked at the regulator for more than 20 years. She is currently the Director of Consumer Investments in the supervision, policy, and competition division. Smart will join from the National Crime Agency, where he sits on the executive committee as Director of Intelligence, leading a division of more than 2000 people. (Emmanuel Kenning, 23/3/2023, Insurance Age, 'FCA appoints two directors to co-lead enforcement and market oversight')

The claims committee of the Lloyd’s Market Association (LMA) has named three new members while two have been re-elected. Following a vote, The Hartford’s Nick Doyle and Steve Yeo of Lancashire Insurance are staying for another term. They will be joined by Steve Agutter of Inigo Insurance; Clare Constable, MS Amlin; and Fiona Sperry, QBE. (Terry Gangcuangco, 23/3/2023, Insurance Business UK, 'New members join LMA claims committee')

Ariel Re has promoted 12 colleagues in its London and Bermuda offices, as part of the reinsurer’s vision of being an ‘academy firm’. Connor Bradbury is now Assistant Underwriter, Caroline Caton is Systems Analyst, Brian Darling is Senior Analyst, Portfolio Management, and Nelia Duarte is AP Finance Manager. Further promotions include Sierra Fisher as Financial Accountant, JayLynn Hines as Assistant Underwriter, Kyra Hodsoll as Assistant Manager, Operations, and Sophia Marshall as Senior Reinsurance Analyst. Final promotions include Ben Martin as AVP, Security and Infrastructure, Carolina Medeiros as Assistant Underwriter, Sarah Morgan as SVP, Property Underwriting, and David Wade as AVP, Analytics. (Terry Gangcuangco, 23/3/2023, Insurance Business UK, 'Ariel Re promotes 12 in London, Bermuda')

Howden has announced the appointment of Andy Cox as Head of Energy Transition, effective immediately. This appointment underlines Howden’s continued investment in, and commitment to, insurance as a solution to the world’s transition to a low-carbon economy, and as a force for good. Cox is based in London and brings with him over 30 years of experience in the energy sector. He will support practitioners from across Howden as they advise clients and investors on de-risking the financing into energy transition projects, as well as guiding the development of new products. (Howden, 21/3/2023, youTalk Insurance, 'Howden appoints Andy Cox as Head of Energy Transition')

In further news...Howden Tiger, the reinsurance arm of Howden Broking Group, has announced a new leader and structure for its legacy division. Seth Ruff, Head of Structured Reinsurance, is set to take on the additional role of Head of Legacy. According to Howden Tiger, the new structure will allow the company to offer cross-discipline solutions and a range of options for clients, such as the sale of a legal entity versus the purchase of a reserve cover. (Mika Pangilinan, 24/3/2023, Insurance Business UK, 'Howden Tiger announces new leader, structure for legacy division')

QBE Re has appointed Debbi Wood as Head of Claims, QBE Re, subject to regulatory approval. Debbi has been with QBE for almost 20 years, having held roles across QBE’s claims function, most recently as Claims Manager, Financial and Specialty Markets (FSM), Complex Claims for QBE Europe. (QBE, 21/3/2023, youTalk Insurance, 'QBE Re appoints Head of Claims')

Tokio Marine HCC International has expanded its UK trade credit division with two Senior Risk Underwriters, Karen Crowley and Arwel Roberts. Crowley brings with her over 20 years of experience in trade credit. In her previous role, she was a Senior Key Account Underwriter at Atradius. Roberts joins from his most recent role at Coface but has also had many years within risk underwriting at Atradius. (Sophie Locke-Cooper, 24/3/2023, Insurance Age, 'People Moves: 20 - 24 March 2023: Tokio Marine HCC International expands UK trade credit division')

Markerstudy has hired Julie Fox as Head of Procurement as of 1 April. She is currently the Associate Director of Contracts and Supply Chain at BGL Insurance. Her procurement career spans over 15 years and her experience lies in the Insurance, Retail, Not for Profit and Facilities Management sectors. Fox joined BGLI five years ago from The Chartered Institute of Procurement and Supply where she was appointed its first Head of Procurement in 2009. (Sophie Locke-Cooper, 24/3/2023, Insurance Age, 'People Moves: 20 - 24 March 2023: Markerstudy reveals head of procurement')

US-headquartered cyber specialty insurer Corvus Insurance, which also has offices in the UK and Germany, has expanded its Frankfurt-based roster. Without disclosing the number of new employees, Corvus said it hired Underwriters with extensive experience providing localised cyber solutions within the European Union. Aside from Cyber Underwriters, a local Head of Cybersecurity Services was also added to the team. (Terry Gangcuangco, 24/3/2023, Insurance Business UK, 'Corvus Insurance expands international team')

Experienced Litigation Solicitor and now Professional Liability Underwriter Sarah Bowden, who is expecting an increase in demand for Litigation Liability insurance, will be leading Mosaic Insurance’s new after-the-event insurance product. “It’s normal to experience a rise in litigation following economic turmoil, and this is inevitable in the wake of the significant disruption we have experienced over the last few years,” said Bowden, who practised as a Litigator for 17 years and was most recently with Mills & Reeve in London. (Terry Gangcuangco, 24/3/2023, Insurance Business UK, 'Mosaic Insurance introduces litigation liability cover')