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General Insurance Newsletter Friday 20th October 2023

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Insurance News

Neville Hunt, who joined the insurance industry in 1969 through Price Forbes, has passed away following a brief battle with cancer. In a statement sent to Insurance Business, Stubben Edge Group said: “Neville, a stalwart of the London Market, had dedicated over 50 years of his life to the industry, being a friend and mentor to many colleagues and leaving a long-lasting impression on all who had the privilege of knowing and working with him.” The company, which noted that Hunt passed away on September 4, believes that his contributions to the London Market will continue to inspire and guide future generations. (Terry Gangcuangco, 19/10/2023, 'Passing of London Market stalwart “leaves a void that cannot be filled”')

​The British Insurance Brokers’ Association (BIBA) has launched a fair value assessment framework exclusively for members. “BIBA members are committed to providing fair value to the customers they serve, as well as the new policy stakeholders created in relation to multi-occupancy properties, reinforcing the core principle that the broker is the agent of the customer and acts in their best interest,” BIBA chief executive Graeme Trudgill said in a release. Created by economics and finance consultancy Oxera, the voluntary framework is aimed at helping brokers implement or refine their own fair value models. To provide BIBA members with a detailed overview of the new tool, the trade body is hosting a dedicated webinar on October 26. (Terry Gangcuangco, 19/10/2023, 'BIBA rolls out fair value assessment framework')

“Insurers continue to do all they can to help their customers.” Those were the words of a spokesperson for the Association of British Insurers (ABI) in an update following the fire that took place in London Luton Airport’s Terminal Car Park 2 on October 10. In a statement on Wednesday, the ABI said: “We’ve worked with fellow industry body the Motor Insurers’ Bureau (MIB) to obtain and share the number plates of the vehicles in the car park with our members, who are contacting customers as quickly as possible. “Many insurers are covering the costs of their customers’ journeys home from the airport; others have said they will waive policy excesses and that any claim from the fire will not impact no-claims discounts. If you suspect that your vehicle may have been damaged in the fire and have not already done so, speak to your insurer to see what support is available.” (Terry Gangcuangco, 19/10/2023, 'ABI issues update on Luton Airport car park blaze')

In its latest global report, Allianz Trade anticipates that business insolvencies in the UK will hover around 30% above pre-pandemic levels by 2025, with notable peaks expected in 2024 (29,850 cases i.e. +5%) and 2025 (28,400 cases i.e. -5%). The rise is primarily attributed to the hospitality, trade, and manufacturing sectors, contributing to an estimated increase of 16% in 2023, equivalent to 3,900 additional cases. Despite all sectors having largely surpassed 2019 levels, the resilience of domestic firms has been strained by successive shocks and challenges, including Brexit-related issues, the COVID-19 pandemic, earlier monetary tightening, and persistent inflation. (Kenneth Araullo, 19/10/2023, 'Business insolvencies in the UK to increase in next few years – Allianz Trade')

Lloyd’s has unveiled a systemic risk scenario that models the potential worldwide economic repercussions of a hypothetical but plausible cyber attack targeting a major financial services payments system. This envisioned disruption would result in extensive global business disruptions and could trigger global economic losses amounting to $3.5 trillion. The scenario anticipates the highest five-year economic losses to be borne by three countries: the United States ($1.1 trillion), followed by China ($470 billion) and Japan ($200 billion). The recovery time for individual countries or regions is contingent on the configuration of their economy, exposure levels, and resilience. (Kenneth Araullo, 18/10/2023, 'Looming global cyber attacks – how exposed are we?')

Legal expenses insurance and assistance provider ARAG has been chosen by Hastings Direct to furnish vehicle hire insurance to the firm’s motor clients. This coverage ensures clients a like-for-like replacement car or van in case of a complete loss of their insured vehicle due to fire, theft, vandalism, or an accident for which they were responsible. The vehicle hire insurance policy will be offered to over a million Hastings Direct motor insurance customers as an optional add-on to their primary motor policy. (Kenneth Araullo, 18/10/2023, 'ARAG tapped to supply vehicle hire insurance for Hastings Direct')

Asta, in collaboration with Oka, has announced that Lloyd’s has granted “in principle” approval for Oka syndicate-in-a-box (SIAB) 1922. The target for commencement of underwriting is set for January 2024. Oka Syndicate 1922 introduces a tailored insurance solution designed to mitigate buyer-side carbon credit risks, encompassing financial, reputational, regulatory, and climate-related risks. Ultimately, this initiative aims to bolster the voluntary carbon market (VCM) by facilitating investment and supporting its growth to meet critical climate targets. (Kenneth Araullo, 18/10/2023, 'Oka receives "in-principle" Lloyd’s approval for Asta-led SIAB 1922')

A Press release from the pricing decision intelligence platform hyperexponential has revealed that Aviva’s Global Corporate and Specialty (GCS) team has utilised its Pricing Decision Intelligence (PDI) platform, hx Renew, to build 20 new insurance pricing models in nine months. These models are now used by underwriters to create new policies in under 10 minutes (compared to over one hour previously). Among the key benefits of the platform, hyperexponential revealed that Aviva’s GCS team has been able to deliver reliable pricing models in record time, freeing actuaries to focus on higher-value actuarial work and business analysis. In addition, the improved performance and reliability of the models allow underwriters to respond to brokers and create policies more quickly. (Mia Wallace, 18/10/2023, 'Aviva fast-tracks pricing with hyperexponential join-up')

Ki has announced a collaboration with Travelers and Aspen, with both carriers providing additional follow capacity through the syndicate’s digital platform. This development marks a milestone for Ki as it allows the firm to be the first algorithmic underwriter in the market to offer augmented capacity from multiple syndicates. The increased capacity will be accessible across Ki’s open market business classes, spanning property, casualty, and specialty divisions. Ki said its brokers and clients will continue to experience the efficiency of its digital platform, including swift responses to quote requests. The platform will also streamline the process of follow capacity offers from partners, complementing the existing Ki 1618 line. (Kenneth Araullo, 18/10/2023, 'Ki expands digital follow capacity through new collaborations')

Howden has introduced Howden Climate Parametrics, a global initiative that melds (re)insurance, climate, and data expertise, with the division aiming to provide tailored parametric risk transfer solutions to meet the burgeoning need for climate de-risking across diverse industries, financial markets, and the public sector. This new practice integrates over 30 specialists from various sectors within Howden and the group's underwriting business, DUAL. The team combines expertise in climate, analytics, advisory, structuring, placement, (re)insurance, underwriting, and capital markets. (Kenneth Araullo, 17/10/2023, 'Howden introduces global climate parametrics practice')

In a notable shift, ransomware is evolving into a new era as cybercriminals adapt their strategies to evade security controls, focusing on critical vendors and aiming for larger targets for extortion, according to Resilience’s Midyear 2023 Claims Report. According to the report, cybercriminals are setting their sights on larger targets, specifically organisations with sensitive data that can meet larger ransom demands. Recent instances include cyberattacks on major entities like MGM Resorts and Caesars Entertainment. Insights from Resilience also highlighted that vendor cyber risk has taken the lead as the main point of failure in cybersecurity, surpassing phishing attacks. The report indicates that incidents involving third-party vendors constitute 28.9% of their clients’ all-time claims, ahead of phishing at 23.1%. (Kenneth Araullo, 17/10/2023, 'Cybercriminals upping "big-game hunting" tactics for major extortions – report')

In its latest trading update for Q3 2023, MoneysupermarketGroup highlighted a substantial 14% surge in revenue, primarily propelled by remarkable growth in the realms of insurance and travel. The insurance segment remained a standout performer, displaying consistent and robust growth across all essential channels. A notable increase in policy shifts within the realms of car and home insurance persisted, buoyed by the ongoing rise in premium rates and a rebound in volumes post the introduction of the FCA General Insurance Pricing regulations last year. (Kenneth Araullo, 17/10/2023, 'Moneysupermarket posts trading results for Q3 2023')

J. Christopher Flowers, a US private equity investor, has warned life insurers that the dramatic increase in their private credit investments may create systemic risk for investors, as reported in an article in the Financial Times. “Too many people have piled into private credit and it has a special feature that a chunk of it is funded with life insurance assets,” said Flowers. Flowers asserted that investors may be underestimating the risks that come from a large amount of money going into private credit loans, with insurers hoping for higher investment. (Abigail Adriatico, 17/10/2023, 'JC Flowers warns insurers about systemic risk from increase in private credit investments')

Specialist insurer Ecclesiastical has partnered with iprism to introduce a digital platform aimed at providing cover for smaller not-for-profit organisations in the charity, education, and faith sectors. The platform leverages Ecclesiastical’s existing collaboration with the managing general agent (MGA), simplifying market access and enabling brokers to reach their clients directly. It also provides Ecclesiastical with access to iprism’s extended distribution network, which includes smaller not-for-profit organisations. (Mika Pangilinan, 17/10/2023, 'Ecclesiastical partners with MGA to launch new digital platform')

A recent survey from the global broking and risk management giant Aon revealed that nearly half of dealmakers expect the volume of mergers and acquisition (M&A) deals globally to increase ‘somewhat or significantly’ over the next year or so. Despite this however, Aon warned that the M&A landscape remains rocky with climate, tax and cyber risks on the horizon. It’s a warning echoed by Jonathan Clark, vice president of corporate development at McLarens, who highlighted that volatility is increasing in the insurance M&A market in general. (Mia Wallace, 16/10/2023, 'What's happening with M&A activity in the insurance market?')

The growth of electric car sales in Europe may be impeded by rising insurance costs and expiring subsidies, as reported in an article by Forbes. Electric car enthusiasts have asserted that these cars will eventually be cheaper as their prices are anticipated to fall along with new battery electric vehicles (BEVs) being made available to average earners. However, their prices are typically around twice as much as new combustion vehicles with most starting around €30,000 after tax. (Abigail Adriatico, 16/10/2023, 'Insurance costs for electric cars may weaken sales')

The efforts of the British government to arrange repatriation flights for British nationals in Israel have faced problems because of issues concerning insurance, as reported in an article by The Guardian. However, other emergency flights that were arranged by US and Australian authorities have been able to land in the UK. The UK government had arranged a flight that was scheduled to arrive at Gatwick Airport last Friday, but it was cancelled. Another attempt to arrange the flight also saw the same result. The cancelled flights were said to be because Titan Airways, its contracted airline, was reportedly facing difficulties in arranging insurance. (Abigail Adriatico, 16/10/2023, 'Insurance issues cause delay in UK repatriation efforts for citizens in Israel')

Brokers in the insurance industry are facing increasing levels of stress, according to a new survey from Ecclesiastical. The insurer’s 2023 Broker Wellbeing Survey has revealed that stress levels have risen for the fifth consecutive year, with 79% of brokers admitting to experiencing stress at work in the past 12 months. Anxiety levels have also reached a new peak, as nearly half of brokers (48%) reported suffering from anxiety during the same period. Commenting on the findings, Ecclesiastical commercial director Adrian Saunders highlighted how systemic issues are affecting brokers’ stress levels. (Mika Pangilinan, 16/10/2023, 'Brokers struggle with soaring stress levels – Ecclesiastical')

Mergers & Acquisitions

Arthur J. Gallagher & Co. has announced that it has acquired Clements Worldwide. Terms of the transaction were not disclosed. Clements, based in Washington, D.C., is an international insurance broker that serves expats, diplomats and military personnel. The firm also provides commercial insurance products for nonprofits, contractors, embassies and schools. Clements also has offices in London, Dublin, Gibraltar and Dubai, Gallagher said in a news release. As part of the transaction, Jon Clements and his team will remain in their current locations. They will report to Bumpy Triche, head of Gallagher’s mid-South retail P&C brokerage operations. (Ryan Smith, 18/10/2023, 'Gallagher bolsters international capabilities with latest deal')

Premier Choice Healthcare (PCH), the health insurance intermediary hub owned by Brown & Brown, has announced the acquisition of the entire share capital of Healthcover Ltd. This marks the tenth deal for PCH since it became a part of Brown & Brown Europe in August 2020. Brighton-based Healthcover Ltd specialises in personal and business private medical insurance (PMI) and has a distinct focus on international health coverage for UK-based customers, a key factor motivating the acquisition, according to Stephen Hough, PCH managing director. (Kenneth Araullo, 18/10/2023, 'PCH boosts PMI offering with major acquisition')

The acquisition trail is not cooling for Jensten which has today announced its purchase of North Yorkshire-based White Rose Insurance Solutions. In a Press release, Jensten noted that the deal will see its regional centre of excellence in Yorkshire & Humberside expand with additional offices and teams. Described by Jensten as the ‘local broker of choice’ for commercial and private clients across North Yorkshire, White Rose looks to provide a high-quality, traditional insurance service to clients from offices based in Skipton and Settle. The firm also trades as South Lakes Insurance Solutions from its office in Kendal. (Mia Wallace, 18/10/2023, 'Jensten expands regional presence with latest M&A swoop')

ABL Group, the Northern Ireland hub of Brown & Brown Europe, has successfully acquired 100% of the share capital of two insurance businesses based in Northern Ireland: Davison & Associates (NI) Ltd and Davison Lamont Ltd. Regulatory approval has been obtained for Davison & Associates, while Davison Lamont, operating as an appointed representative, does not require approval. The financial considerations for both transactions remain undisclosed. Maurice Boyd, ABL’s CEO, said that both acquisitions stand to benefit Brown & Brown. Boyd also confirmed that both businesses would relocate to ABL’s offices in Belfast. (Kenneth Araullo, 16/10/2023, 'Brown & Brown announces Northern Ireland acquisition')

Allianz has announced its agreement to acquire Tua Assicurazioni S.p.A. from Assicurazioni Generali S.p.A. for a consideration of €280 million. Tua Assicurazioni possesses a property and casualty (P&C) insurance portfolio with recorded gross written premiums totalling about €280 million in 2022. Most of these premiums are managed through a distribution network comprising nearly 500 agents. Allianz has stated that it is well-prepared to ensure a seamless transition for clients, employees, and agents while leveraging the advantages of scale. (Kenneth Araullo, 16/10/2023, 'Allianz announces acquisition of Tua Assicurazioni')


​Zurich Insurance Group has appointed Nordic chief underwriting officer Mattias Fritz as the insurer’s chief executive in the region. Effective in November, the promotion will see Fritz lead about 200 colleagues in Denmark, Finland, Norway, and Sweden while based in Stockholm. The new Zurich Nordic CEO is succeeding Dirk De Nil, who has moved on to become global head of Zurich Resilience Solutions. (Terry Gangcuangco, 18/10/2023, 'Zurich Nordic promotes CUO to CEO')

Pro MGA, the independent managing general agent incubation division of Pro Global Holdings, has announced the appointment of David Goodley as its new head of compliance. Goodley will be succeeding Gordon Burrows, the previous head of compliance, who will be departing from Pro MGA at the end of October. Goodley brings a wealth of experience to the role, having established his own compliance company, City Compliance, in 2012, providing regulatory compliance services across the insurance industry, with a particular focus on brokers and MGAs. (Kenneth Araullo, 17/10/2023, 'Pro MGA bolsters expert team with head of compliance appointment')

WTW has boosted both its leadership team and its claims proposition with the appointment of Rob Powell as global chief claims officer. According to his LinkedIn profile, Powell formerly held the position of global chief claims officer at Marsh McLennan in 2014. In this role, he was responsible for overseeing Marsh’s claims operations, advocacy, and forensic advisory services. Powell will focus on advancing WTW’s end-to-end claims proposition, aligning claims teams with WTW’s robust specialist industry practices, and enhancing claims services through data and analytics. For this new function, Powell is set to join the global firm in early 2024 and will report to Adam Garrard, the global head of risk and broking. (Kenneth Araullo, 17/10/2023, 'WTW boosts leadership suite with new global chief claims officer')

​Liberty Specialty Markets (LSM) has announced the appointment of Marilyne Furlan as the head of casualty for Europe, effective in December. Taking over from Katja Bobrowski, who is set to retire in February 2024, Furlan will collaborate with her predecessor to ensure a smooth transition for LSM’s clients and brokers in the region. Her primary responsibilities encompass steering sustainable growth across casualty lines in Europe. Additionally, she will provide oversight and leadership concerning LSM’s casualty underwriting strategy and product offerings. (Kenneth Araullo, 17/10/2023, 'Liberty Specialty Markets taps head of casualty for Europe')

Gordon D’Arcy – a former professional rugby player for Leinster, Ireland and British and Irish Lions – is joining the ranks of Lockton, the world’s largest independent brokerage. Taking up a newly created role as business development executive within the firm’s transactional risks division, D’Arcy will be based in Dublin, Ireland. In his new role, D’Arcy will oversee deal origination, with a key focus on supporting M&A transactions throughout the UK and Ireland. He will also look to support the people solutions and general insurance teams at Lockton Ireland. (Mia Wallace, 16/10/2023, 'Lockton strengthens division with key appointment')

Three senior underwriting hires have been picked by Aviva for its financial lines team within the company’s global corporate and specialty (GCS) business. The new GCS colleagues are Samantha Shean – financial institutions head, Duncan Goddard – senior financial lines underwriter for South & Greater London and Kate Albert – professional indemnity underwriting manager. Shean, Goddard, and Albert were snapped up from AXIS Capital, Chubb, and Landmark Underwriting, respectively. (Terry Gangcuangco, 20/10/2023, 'Aviva boosts financial lines team with senior hires')

Lockton has named Andrea Guffanti as head of Continental Europe, a newly created role based in London. The appointment will see Guffanti collaborate closely with the Lockton Global Partners’ operations team, led by Michael Goudime, as well as Lockton’s specialty teams in the London Market and its owned operations in Europe. The overarching goal is to enhance client reach and bolster strategic relationships across the continent. (Mika Pangilinan, 20/10/2023, 'Lockton appoints head of Continental Europe')

All information provided in this Market Digest has been gathered from Insurance Business UK.