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General Insurance Newsletter Friday 11th October 2019

11 Oct 2019

Insurance News

InsurTech start-up Wrisk is looking to partner more with the incumbent insurance industry, according to newly appointed Chief Executive Officer, Nimeshh Patel. Patel took over the CEO role from former Oxygen boss Niall Barton in August. Barton, who in 2016 co-founded the business with Darius Kumana, previously at Markel, remains with the firm as Executive Chairman. “It’s a different landscape when you go from a start-up to a business that is starting to scale,” Patel said. 

Seventeen Group has posted a 12.5% rise in revenue to £18.4m for the full year 2018 (2017: £16.4m). The business also reported a fall in pre-tax profit to £812,716 in 2018 from £1.3m in the preceding year. In addition, operating profit decreased to £1.0m (2017: £1.4m), while administrative expenses rose to £17.4m (2017: £14.0m). According to Seventeen Group the reduction in profit had been expected and was driven by increased amortisation charges incurred following acquisitions.

The Financial Conduct Authority (FCA) has slammed the Home and Motor insurance markets for not working well for all consumers, as it published its general insurance pricing practices interim report. According to the FCA, around six million consumers are negatively impacted by dual pricing practices because they do not shop around. If those customers paid the average premium for their risk they could save around £1.2bn a year. The regulator found that all types of customers were affected, but noted that this includes 1 in 3 people who are potentially vulnerable. Christopher Woolard, Executive Director of strategy and competition at the FCA, has reiterated that the regulator is considering banning dual pricing practices in insurance. At a press conference in London, Woolard said: “One remedy that we’re looking at is restricting or banning the practice of raising prices for people who renew year-on-year.”. 

XL Catlin Insurance Company has settled a breach of contract law suit which it brought against Rural Insurance Group, reports Law360. According to the article, the Axa XL subsidiary filed a claim in the High Court in August, which said that Yorkshire-based Rural had only paid £101,000 of £2.42m it allegedly owed under a deal in 2014. XL Catlin claimed that Rural was in breach of trust and fiduciary duty for not keeping the funds separate from its own. The two businesses reached a settlement agreement on 3 October.

PSP Group, based in the South West, has bought Paul Hicks Insurance Services for an undisclosed sum. This is the Broker’s fifth deal in the last two years and brings the company to a gross written premium of £20m. Paul Hicks Insurance was founded in Lanceston in Cornwall in 1993 by Paul Hicks. The Broker has six employees, including Hicks and all staff will remain with the business and continue trading from the same premises.

Green Insurance Group, the South East hub business of Global Risk Partners (GRP), has bought Millards Insurance Services, based in East Kent, for an undisclosed sum. According to the Broker, the acquisition has received regulatory approval. Greens CEO, Duncan Coleman, said the transaction is the Bexhill-based Broker’s third this year after Reid Briggs and Clifton Morley in May and the sixth in all since GRP’s investment in Greens in 2017.

Canopius Group has completed the merger of AmTrust at Lloyd’s. A spokesperson for Canopius said that a “small number of positions are at risk of redundancy” as a result of the merger. The deal also brought around 200 new employees to the provider, bringing its total headcount in London to around 550. AmTrust at Lloyd’s Managing Director, Sheldon Lacy and Chief Underwriting Officer, Chris Jarvis, have both joined the senior team at Canopius.

A-Plan has confirmed that it paid £9.4m for Jelf’s personal lines business. Jelf and A-Plan announced a strategic partnership in January this year, which saw the majority of Jelf’s personal lines business move across to A-Plan. A-Plan Chief Executive Officer, Carl Shuker, said: “Jelf got a good price for the business and we bought a very good business that we’re happy with. It’s a win-win arrangement.”.

AXA Partners has extended its partnership with Lloyds Banking Group with a new multi-year deal, which now sees the company providing Home Emergency cover to over one million customers. AXA Partners has been providing cover to Lloyds Banking Group for 15 years and this new deal not only extends their existing partnership, but the company will also now provide cover to Lloyds Bank and Bank of Scotland Premier Added Value Account customers.

In further news...AXA XL has announced, as part of its commitment to stem the tide of ocean risk, the launch of an ocean protection education campaign that will involve major local supermarkets. The campaign will also include television and radio commercials, social media posts and presentations in schools – all designed to reach every sector of the island.

In a move that empowers consumers with pre-existing medical conditions to find the right Travel insurance at a suitable price, AXA, the UK’s largest Travel Insurer, has launched its ‘Travel Health Calculator’, developed by emergency medical assistance experts CEGA, a Charles Taylor company. AXA’s Travel Health Calculator offers a quick online solution for travellers with pre-existing medical conditions. Users simply enter their conditions online and immediately receive a report which tells them how these could affect their Travel insurance search. The information tool then provides them with a list of Brokers and Insurers who specialise in providing cover which may meet their medical needs, or directs them to price comparison sites if they have less complex medical needs.

Further to Liberty Mutual Insurance Group completing the acquisition of Nationale Borg Reinsurance (NB Re) on 2nd October, Liberty Mutual Re (LM Re) announced that it will make changes to the structure of its Financial Risks Reinsurance team. In Continental Europe, Financial Risks Reinsurance will operate out of Paris, Milan and Amsterdam. The Paris office will focus primarily on Western Europe, Africa and the global credit Insurers. Milan will serve clients in Southern Europe, Middle East and Asia Pacific and the new base in Amsterdam will focus on the Nordic and Central & Eastern European Regions. Financial Risks Reinsurance business that was previously written from Zurich will be transferred to one of the other offices with no change in underwriting strategy or risk appetite.

Ecclesiastical Insurance has retained its top spot in the Fairer Finance Home Insurance league table and remains the UK’s most trusted home insurance provider. The specialist Insurer topped the list of 49 Insurers including household names such as John Lewis, NatWest, Co-operative Insurance and Aviva.

Matthew Reed, MD and Founder of healthcare MGA Equipsme, has joined a group of business leaders in a meeting hosted by Chancellor of the Exchequer, Sajid Javid. The meeting centred on how the government can aid the growth of SMEs and Reed called for the government to make it easier for small businesses to look after the health and wellbeing of their staff.

Acturis is expanding its e-trade capabilities with the development of its first Cyber add-on product by HSB Engineering Insurance. The software house stated that the launch sees HSB, part of Munich Re, become the first Insurer to go live with the Cyber add-on solution on the Acturis platform. The Cyber product follows the launch of the HSB suite of construction insurance products on Acturis last March.

The Chartered Insurance Institute (CII) has signed the Inside Out Leadership Charter, aimed at demonstrating leadership engagement in and commitment to the mental health agenda. The organisation has committed to the following set of principles: Prioritising the mental health and well-being of CII employees, having a board level sponsor for mental health and discussing mental health and well-being at board meetings at least twice a year.

Gefion Insurance has closed the placement of Solvency II-compliant subordinated notes to a value of €6m (£5.4m) with funds managed by Fermat Capital Management. The unrated Danish provider stated that the net proceeds from the recapitalisation will be used to strengthen its capital base and support its ongoing business. The business added that the move follows a similar €10m placement that Gefion and Fermat announced in July 2017.

There’s still time for Brokers to nominate a local charity for a QBE ‘Charity of Choice’ Award. Alcohol is estimated to cost the NHS around £3.5bn per year, which amounts to £120 for every taxpayer, according to 2016 figures from the Health and Social Care Information Centre (HSCIC). Many people who consume alcohol exceed the recommend daily limit and face Alcohol Related Brain Injury (ARBI). However, ARBI is a reversible condition and up to 75% of patients can make partial or complete recovery if given personalised treatment and care. Such support can really make a difference to the lives of many, achieving better patient outcomes, cost savings and significant reductions in recurring hospital admissions. Leonard Cheshire are a charity whose aim it is to support individuals with disabilities, to enable them to live, learn and work as independently as they choose, whatever their ability.

The International Forum of Terrorism Risk (Re)Insurance Pools (IFTRIP) and the Geneva Association (GA) are launching a joint task force on Cyber Terrorism and Cyber warfare. The special-purpose task force aims to conduct research on Cyber Terrorism risks across the (re)insurance industry. The task force will be led by Dr Rachel Anne Carter, Cyber Director at the GA, supported by Julian Enoizi, CEO of Pool Re and Dr Christopher Wallace, CEO of Australian Reinsurance Pool Corporation and President of IFTRIP.

Gallagher’s analysis of flight data from 135,000 European regional flights in 2018 evidences the crippling financial impact of EU261 compensation for flight cancellations and delays of more than three hours on regional airlines. Data analysed reveals carriers can expect expenditure on EU261 compensation to double year-on-year, regardless of size of airline. Research reveals the current disparity between ticket price, revenue and compensation payments threatens economic viability of regional airlines.

Premium income in the London company market has increased to £28.437bn, a new report by the International Underwriting Association (IUA) has shown. Gross written premium in London for 2018 was £19.559bn while a further £8.877bn was identified as written in other locations, but overseen and managed by London operations. The data from the latest edition of the IUA’s London Company Market Statistics Report represents an overall rise of 8.1% (£2.123bn) on the previous 12 months and follows a 16% jump reported in last year’s publication.

Financing is one of the greatest challenges for SMEs today. According to the World Bank, approximately half of all SMEs around the world lack access to credit. With bank credit lines and loans being the most common and straightforward sources of debt funding for SMEs, this is a bit of a problem. The challenge is that banks, or similar financial lending institutions, often require proof of success and/or collateral before they will support an SME, but not all SMEs can meet those requirements.

Argo Group International Holdings, Ltd. has received a subpoena from the US Securities and Exchange Commission and the company’s independent Directors are also conducting a governance and compensation review. These were the revelations made by Argo in a new release, which noted that the SEC was seeking documents related to the firm’s disclosure of certain compensation-related perquisites. In August it was announced that there will be executive compensation changes at the specialty Insurer from its 2020 fiscal year.

Minova Insurance’s underwriting business Pioneer Underwriters will not see its independence impacted by the sale of its sister firm BMS Group. Shortly after it was revealed that the significant equity investment by affiliates of British Columbia Investment Management Corporation and Preservation Capital Partners in BMS had been completed, Pioneer confirmed that it remains independent and owned directly by previous shareholders.

Specialist insurer CFC has announced the acquisition of Solis Security, a Texas-based incident-response provider. The acquisition expands CFC’s in-house Cyber incident response capabilities, the company said. CFC has one of the world’s largest in-house Cyber claims and incident-response teams and has handled nearly 1,500 Cyber claims this year alone. The addition of Solis Security deepens CFC’s bench of in-house experts, the company said.

Market Movers and Shakers

InsurTech business Broker Insights has hired David Christmas as Head of Broker Sales and Development. Christmas was previously Broker Director at Bennett Christmas Group, but left after the firm was bought by Ethos Broking in August. Jon Elstone, former Commercial Relationship Manager at Swinton, has also joined Broker Insights. He will be responsible for Broker Sales and Development in the South West of England.

Markerstudy Group has chosen Sheree Dawton to join the firm as Head of Group Property. Her position will include managing three of Markerstudy’s divisions – property, maintenance & facilities and health & safety. She joins Markerstudy from high-net worth investors, TwinFocus where she was responsible for the Markerstudy Property portfolio.

Bridge Insurance Brokers has appointed Sarah Harrop to be its new Head of HR. In this role she will be responsible for managing a team based in the company’s Manchester headquarters on Charlotte Street. A spokesperson from Bridge said that Harrop has been in this role for a few weeks and that most recently she worked as Head of HR at PeoplePlus UK.

MGA, HB Underwriting has selected Kyle Lomas to be its new Managing Director, he will join the firm in November. The hire sees Lomas move from his position as UK Head of Agricultural Underwriting at Victor Insurance.

Specialist insurance provider, CFC has added Avraam Avraam to its Medical Malpractice underwriting team. Avraam will serve as Team Leader working with Practice Leader, Sharon Brennan, to develop CFC’s book of non-US international business.

Charles Berry, Chair of BPL Global became President of the Insurance Institute of London (IIL) for 2019/20 last Monday (30 September). He succeeds Nicolas Aubert, CEO, Willis Tower Watson GB and is joined by the IIL’s new Deputy President, Anthony Baldwin, CEO and Board Director AIG UK and Deputy President designate, Julian Enoizi, CEO, Pool Re.

The Association of British Insurers (ABI) has appointed Julian Adams, Director, public policy and regulation at M&G (holding company of the Prudential Assurance Company). He has been an ABI board member since 2016 and will now work alongside the body’s Chair, Jon Dye, until summer 2020.

HDI Global Specialty UK’s London contingency team will have two new senior underwriting members. Martin Holness has been appointed as Head of Contingency and Sheena Williams has been selected to be Senior Underwriter, Contingency.

Thomas Coates has joined Miller, bringing almost two decades of market experience to benefit Miller’s North American intermediary clients and Asian based Broker clients. Thomas’ remit includes developing Miller’s existing FI and D&O offering and producing new business in North America and Asia-Pacific.

InsurTech start-up, Cuvva has appointed Bruce Carnegie-Brown as Chairman. The Broker noted that Carnegie-Brown has over three decades of experience in the insurance, banking and asset management sectors. He succeeds Nick Parker, who had been with Cuvva since it launched.

Marsh has announced the appointments of Bryce Check as a Business Relationship Director and Anna Whitfield as a Client Service Director in the UK Real Estate Practice. Part of Marsh JLT Specialty, the UK Real Estate Practice provides insurance and risk advisory services to real estate owners, operators, managers, and developers.

Tokio Marine HCC has announced that Sharon Brock and Tom Weist have been appointed Co-Chief Financial Officers, effective October 1, 2019, replacing Brad Irick who has been named the next Group Chief Executive Officer of Tokio Marine Kiln.

The Association of Consumer Support Organisations (ACSO), which last month welcomed six new members including Legal Expenses specialist Coral Insurance and injury solicitors Hilary Meredith, has added Alex Neill and Crispin Passmore to its advisory committee. Neill, an Aviva and RAC alumnus, spent more than a decade at consumer champion Which? where she held senior roles such as Managing Director of Home Products and Services. The new Independent Advisor, who believes business should benefit society, is “keen to help ACSO sponsor different ways of thinking about the nature of the contract between companies and their customers so that the reputation of business – so damaged in recent years – can begin to be restored.”. 

Gravity Risk Services has recently taken on three new apprentices as part of its latest recruitment drive. The three apprentices will all be working towards qualifications while working at the Stourbridge-based insurance Broker. Josh Richards and Alice Maley, both Finance Assistants, will be working towards their Association of Accounting Technicians (AAT) qualification. Meanwhile, Luke Love starts on the Chartered Institute’s apprenticeship programme.

Ascent Underwriting, a group company of Optio, has appointed Kieran Shiret and Henry Rydon as its newest Underwriters for Cyber insurance. Both Shiret and Rydon will bring “additional Cyber expertise and experience” to Optio – particularly in the company’s core market of North America. Shiret was most recently an Underwriter with Beazley, while Rydon previously held an underwriting role at Equinox.

Resolution Re has appointed Steve Hales as Chief Executive Officer. Hales has worked for several global insurance names prior to joining the Bermuda-domiciled reinsurance arm of the Resolution Life Group. Hales joined Resolution Life Group in 2017 as Executive Director for Europe. Prior to that, he was Group Head of Connected Insurance at Assicurazioni Generali, where he led the group’s data science and Internet of Things capabilities. He joined Generali in 2013 to lead its newly-created global life business line.

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

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