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General Insurance Newsletter Friday 15th February 2019

15 Feb 2019

Insurance News

According to the Eurasia Group consultancy, the global geopolitical environment is at its most dangerous in decades. They say that global decision-makers are so focused on the daily crises that arise from a world without leadership that they’re allowing a broad array of future risks to germinate, meaning the outlook for institutions such as the European Union and the World Trade Organisation isn’t great. They point, for example, towards the wider impact of the relationship between the world’s two largest economies, the United States and China and their ongoing trade war, warning us to expect more discord in the arenas of technology, economics and security – with global supply chains potentially affected.

Zurich has appointed Specsavers Corporate Eyecare to provide specialist eye care for Zurich’s engineers. Under the terms of the agreement, Specsavers will provide Display Screen Equipment (DSE) eye care and prescription safety eyewear for engineers based at the insurer’s Birmingham office.

AXA UK has published its Gender Pay Gap Report 2018 as part of its ongoing commitment to gender parity and the principles of the Women in Finance Charter. Based on hourly rates, women earn 20 per cent (median) and 23 per cent (mean) less than men. In 2017, the median and mean pay gaps were respectively 17 per cent and 27 per cent. AXA UK’s gender pay gap continues to be driven primarily by the gender distribution across the organisation, with more women in junior roles and more men in senior roles.

In other news... AXA XL has confirmed that 711 people across its European operations are at risk of redundancy as it works to integrate Axa Corporate Solutions, Axa Matrix, Axa Art and XL Catlin. The provider could potentially cut up to 275 roles in the UK. Axa XL has a total of 9,500 employees globally.

In further news... Amar Masud, whose exaggerated employers’ liability claim had been struck out, will now be spending 16 months in jail for ‘deliberately lying’. The 44-year-old sustained a work-related injury in 2013 and – pointing to his supposed inability to work following the accident – was seeking to be compensated in excess of £250,000. Insurer AXA’s probe, however, found Masud’s assertion to be fraudulent and challenged him for contempt of court.

Carole Nash, the UK’s leading provider of motorcycle and classic car insurance, has teamed up with price comparison platform,, to bring its car, van and home insurance products to a new group of web-savvy customers across the UK. Founded in Altrincham in 1985, Carole Nash has grown to become one of the most highly regarded brands in the motorbike insurance market and rightfully so.

Honcho’s new app aimed at millennials looks to challenge aggregators by giving power to consumers, says GlobalData Reverse price comparison site Honcho poses a threat to aggregators with its digital, time-saving approach aimed at appealing to millennials, says GlobalData, a leading data and analytics company.

Premium Credit, the UK’s leading premium finance company, is warning a poor Brexit outcome could create major cash flow problems for businesses and many could find it harder to pay for their running costs, including insurance. It warns that a no deal Brexit could lead to a surge in businesses with no insurance and in some cases, they could be breaking the law by not having compulsory cover.

Dave Matcham, Chief Executive of the International Underwriting Association, explains how London Market companies are preparing for Brexit while lobbying hard for greater contract continuity. It was Benjamin Franklin who wisely counselled that: "By failing to prepare, you are preparing to fail." This is a maxim that London Market Insurers seem to have had firmly in mind ever since the UK's 2016 referendum on EU membership resulted in a vote to leave.

Allianz has become a Partner of the Women’s Engineering Society (WES). The new partnership demonstrates Allianz’s commitment to bringing more female employees into the engineering industry and developing a more diverse workforce. As a company Partner, Allianz will attend events run by WES to learn about and share good practice as well as advertising engineering vacancies on the WES website job boards and newsletters, to reach a larger network.

Aston Lark’s purchase of Irish Broker Robertson Low has received approval from the Central Bank of Ireland. Dublin-based Robertson Low, founded in 1995, is Aston lark’s first international deal. The licensed Lloyd’s Broker employs 40 staff across offices in Dublin, Portlaoise and London.

MS Amlin has launched a new technology combined product designed for the technology sector. The provider noted that the product is modular in nature and allows clients to pick and choose products and having as much or as little cover as they require.

A ghost Broker has been sentenced for setting up fake companies and also stealing the details of real companies to buy fraudulent fleet insurance products. He sold the cover to innocent members of the public, used it for his own vehicles and also used it for vehicles that has been involved in criminal activity including drug dealing and burglary. Suhail Hassain, 29, of Armitage Gardens, Luton, was sentenced to two years in prison at Inner London Crown Court on 11 February 2019.

Non-damage business interruption is now covered by Pool Re following the Royal Assent of the bill which allows it to cover losses incurred if a business cannot trade or is prevented from accessing its premises in the wake of a terrorist attack. Before the law was changed, Pool Re could only reinsure losses incurred if a company’s premises had been physically damaged by terrorists. Both the British Insurance Brokers’ Association (Biba) and the Association of British Insurers (ABI) welcomed the news.

Romero Insurance Brokers group Managing Director Simon Mabb has stated that recent consolidation activity in Nottingham has opened up opportunities for the Broker’s new office. When the business reported its results for the year ended 30 April 2018, it also highlighted the appointment of Nottingham Branch Director David Wagstaff. Romero first attempted to open an office in 2016 but it closed after around six months. 

While insurance companies have been stressing over the implications of a hard Brexit for contract continuity, it turns out small- and medium-sized enterprises (SMEs) are worried they might not even have the means to get insured. A study by premium finance firm Premium Credit found a link between the prospect of having no insurance and a no-deal divorce between the UK and the European Union, as far as SMEs are concerned. It warned that a poor Brexit outcome could result in major cashflow woes for businesses which, in turn, could lead to their inability to purchase coverage.    

Liberty Specialty Markets has forayed into Italy’s casualty market. “Since we launched in Italy in 2012, we’ve been steadily growing our presence, now reaching 35 people in our Milan office,” noted Antonio Sacchi, LSM’s General Manager for Italy. “We’re now adding a local underwriting capability in casualty, which is of real strategic importance to our clients, allowing us to offer a broader range of solutions in the Italian market.”

Tewkesbury Borough Council has granted the green light to Gloucester Business Park owner Arlington for plans relating to Ecclesiastical’s new headquarters. The specialist insurance and financial services company, whose lease on its current Beaufort House location is expiring at the end of next year, is moving to a new purpose-built office aimed at providing what Ecclesiastical described as a modern and flexible working environment.

Lodestar Marine has announced an agreement with Aspen Insurance to provide protection and indemnity (P&I) insurance to owners and Managers of small and specialised ships. Lodestar will now provide cover up to US$50 million backed by Aspen, with an additional US$450 million capacity added through an excess of loss policy placed with certain Lloyd’s of London syndicates and company market security, the company said. Lodestar will continue to provide claims-handling services.

Department store chain Debenhams, whose suppliers have seen a series of trade credit insurance cuts, is getting a breather in the form of millions of pounds. In an update on its refinancing discussions with lenders, the high street retailer said it has agreed an additional facility that will provide £40 million of “increased liquidity headroom, available to draw as required.” This comes as Debenhams strives to retain a stable footing for the UK-headquartered enterprise.

Ascot and Beazley have launched a cargo consortium at Lloyd’s of London aimed at providing a maximum of US$50 million in capacity. Bringing together a range of cargo carriers, the A2B consortium will cater to SME cargo business and offers insureds the option of using electronic cargo monitoring devices developed by Lloyd’s Lab programme graduate Parsyl. The Denver-based insurtech firm’s tools are capable of monitoring cargo accumulation and collecting useful data for risk management and claims.

Property and casualty insurance giant CNA Financial has today announced a fourth quarter (Q4) net loss of US$84 million (about £65.1 million), a US$307 million (about £238 million) decrease from the prior year period, when the Insurer posted net income of $223 million (about £173 million). The insurer attributes this variance to higher net catastrophe losses of US$91 billion, as well as lower investment returns on its limited partnership and common equity portfolios of US$143 million. CNA also experienced higher non-catastrophe losses driven by increased property losses and increased professional liability losses in its London operation.

Late last year the Prudential Regulation Authority proposed to raise the fee it charges for processing insurance business transfers under Part VII of the Financial Services and Markets Act 2000 (FSMA). Now the UK watchdog has released a policy statement in response to comments from the industry. Referring to the results of its consultation paper (CP28/18) on the proposal, the PRA noted: “One respondent suggested that the proposed changes to the transaction fee for insurance business transfers under Part VII FSMA could act as a deterrent, or make the transaction less attractive, for smaller insurance firms.

A total of £300,000 in seed funding is in the offing for Startupbootcamp graduate TrackActive. The insurtech said it’s on track to raise the amount following what it described as a successful collaboration partnership with Gen Re. With its new AI-enabled TrackActive Me solution, the UK-based firm is working with the Berkshire Hathaway subsidiary and its client base.         

American International Group has reported a net loss of US$622 million (about £483 million) for the fourth quarter (Q4) of 2018, down significantly from US$6.7 billion (about £5.2 billion) in the prior-year quarter. Like many, the insurance conglomerate was hit with significant catastrophe losses - US$798 million in Q4 – primarily related to the Californian wildfires and Hurricane Michael, which made landfall in Florida in October 2018.

From 2017’s €6.2 billion (around £5.38 billion) to last year’s €2.1 billion (around £1.82 billion) – that’s how much major Insurer AXA saw its full-year profit fall, with a number of reasons to blame. Releasing its financial results this morning, the Paris-headquartered group noted that the slight increase in its adjusted earnings was more than offset by several culprits. At constant Forex, adjusted earnings rose only 3% (0% on a reported basis) to €6.5 billion.

A case that jolted insurance and legal circles has been put to rest. For anyone following the claim put forward by Bianca Cameron against an unknown at-fault driver and the vehicle’s Insurer over a collision in 2013, here’s the latest on the legal action that went all the way to the UK’s Supreme Court. In a nutshell, British insurance provider LV= secured a ruling in its favour – an overturn of a Court of Appeal decision which essentially meant that insurers would have to satisfy judgments obtained against unnamed individuals on the basis that the vehicle is covered by a policy issued by them.

Sainsbury’s Bank – which offers car, home, pet, travel and life insurance – has become an associate member of the Association of British Insurers (ABI). The first major supermarket to offer banking facilities, Sainsbury’s Bank joins the likes of legal firms, consultants, software companies and white label brands which are not eligible for full ABI membership but have an interest in insurance and the work of the trade body.   

The sale of Aspen Insurance Holdings Limited will see former boss Christopher O’Kane receive a transaction bonus worth US$10 million. In a Form 8-K filing with the US Securities and Exchange Commission, the insurance group said it has approved the grant of transaction bonuses in connection with the now completed deal with affiliates of certain investment funds managed by affiliates of Apollo Global Management, LLC.

Ageas UK has revealed a profitable 2018. Releasing its full-year financial results this morning, the Insurer announced a net result attributable to shareholders of £76.7 million – a massive leap from 2017’s £25.4 million. Its combined ratio, thanks to the motor unit, saw a significant improvement from 103.2% previously to last year’s 96.8%. 


Market Movers and Shakers

SSL Endeavour Group has confirmed that Karen Allen, Chief Executive designate and group Managing Director, has left the business after only a few months. Allen joined the Lloyd’s Broker in October last year from Howden UK Group where she was one of the Directors. She has spent almost 20 years as a Broker in the Lloyd’s market specialising in international specialty casualty insurances.

TT Club, the international transport and logistics industry’s leading provider of insurance and related risk management services, has appointed Andrew Peers as the Senior Underwriter for its UK, Benelux and Nordic underwriting team. Andrew joins the Club from RSA, where he spent 17 years and led a team of 12 marine liability and Marine Property Insurance Underwriters, delivering value to his clients and London market Brokers. Andrew has also held senior positions at GE Frankona and Willis.

It looks like Nottingham’s Russell Scanlan is on a roll. January saw the independent insurance Broker create a business protection and healthcare division as well as launch a bespoke legal expenses insurance scheme for commercial pilots and aircrew… now the Wellington Circus-based enterprise has added a new role to its roster amid expansion plans. The latest recruit is Olivia Whiteley, who brings 13 years of industry experience and will serve as Commercial Account Handler for mid-corporate insurance.

Marsh has announced the appointment of Christopher Hetner, former Senior cybersecurity Advisor to the Chairman of the Securities and Exchange Commission (SEC), as a Managing Director in the company’s growing cyber risk consulting practice. In his new role, Hetner will focus on advising clients on ways to improve their cyber resilience and risk management strategies. He will also consult on global cybersecurity regulatory requirements and disclosure guidelines. Hetner will be based in New York and will report to Kevin Richards, global head of cyber risk consulting.

Kerry Knief is now part of Arc Legal Assistance in her capacity as Senior Corporate Relations Manager. The former AXA Partners Senior Account Manager brings more than two decades of industry experience to the legal expenses Insurer. Knief’s remit will centre on managing existing corporate relationships and identifying growth opportunities with partners across the firm’s ancillary product range.

Andrew Corton is moving to Pioneer Underwriters to serve as project cargo Underwriter. Making the switch from Pembroke Managing Agency, where he was divisional Director for cargo, Corton brings 35 years of insurance industry experience to his new role at Pioneer. The seasoned executive began his career at Trinity Insurance Company before spending time at the likes of Phoenix Assurance Company (now RSA) and Travelers.

SCOR’s Chief Executive of reinsurance at its global property and casualty operations is moving up come April. Appointed as CEO of SCOR Global P&C, Jean-Paul Conoscente will succeed company veteran Victor Peignet who has decided to retire for personal reasons. The latter joined the major reinsurer’s facultative department in 1984.

Gary Humphreys, Group Underwriting Director at the largest managing general agent in the UK, has been named a Board Director of the Managing General Agents’ Association (MGAA).

Global reinsurer PartnerRe has announced the appointment of Jacques Bonneau to its board of directors. Bonneau has held multiple Executive roles. He most recently served as group Chief Underwriting Officer at Chubb from 2014 to 2017 and as CEO of Chubb Tempest Re Group between 2005 and 2014. He also served for six years as CEO of Chubb Tempest Re USA.

Chubb’s industry practices unit in the UK and Ireland has a new Manager in the form of Louise Joyce. The promoted Executive, who joined in 2005 as an Underwriter, has been tapped to lead the life sciences team. Headed by Karen Strong, the industry practices business is made up of technology, life sciences, entertainment, real estate and media. Effective immediately, Joyce is moving up from her role as Birmingham Branch Manager to oversee life sciences’ strategic development and execution.      

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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