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General Insurance Newsletter Friday 16th November 2018

16 Nov 2018

Insurance News

CBL Insurance, the parent company of Ireland-based CBL Insurance Europe and CBL Insurance in New Zealand, has been put into liquidation by the Auckland High Court. According to the Reserve Bank of New Zealand (RBNZ) the high court appointed Kate Johnstone and Andrew Grenfell, Partners of McGrathNicol, as liquidators of CBL Insurance. CBL appointed KordaMentha as voluntary administrators in March after RBNZ applied for the interim liquidation of CBL Insurance in February.

Marsh has revealed plans to combine the specialty teams of Marsh and Jardine Lloyd Thompson Group (JLT) to create Marsh-JLT Specialty. The unit will be a new specialty business within Marsh once regulatory approval for the takeover is completed. Parent firm Marsh & McLennan Companies (MMC) signed up in September to buy JLT for $5.6bn (£4.3bn).

Zurich has opened up its international programmes range for medium-sized businesses. According to the provider the offering, which was already available to larger firms, aims to help businesses which are trading in other countries in addition to the UK. Zurich explained that Brokers and customers would have one point of contact to help them manage their risks, while being able to tap into local expertise in any other markets they have a presence in.

Specialist health insurance Broker Jade Insurance Consultants has supported the launch of My Club Insure, a new part of the My Club Group. The offering provides personal health insurance plans for sports club members with the clubs earning commission every time a policy is taken out. The wider My Club Group creates personalised websites for clubs incorporating the club colour, logo and name.

Gallagher UK retail CEO Michael Rea has stated that Gallagher hopes to announce another acquisition before Christmas if regulatory approval can be achieved. Looking ahead, Rea added that there was no slowing down for Gallagher in terms of closing deals. “There will be another deal before the end of 2018, however, it depends on how quickly the Financial Conduct Authority can come back and give regulatory approval. But I would expect one more deal before Christmas,” Rea continued.

Allianz UK CEO John Dye has said that recent prices from the Insurer have reflected the current climate of claims inflation. “We have seen a deterioration in the performance of theft. It is almost as if the economy has been in recession as theft and arson tick up when the economy is under pressure.” “While Mark Carney might tell us we are not in recession we can see an increase in theft claims both in terms of the number of them and their cost.”

In other news...The British unit of Allianz reports better financial results. From £84.6 million in July-September 2017, Allianz UK posted a higher operating profit of £113.6 million in the third quarter of 2018. Its combined operating ratio (COR) for the period also saw a positive shift, from 98.5% previously to 96%.

Following an investigation by the City of London Police’s Insurance Fraud Enforcement Department (IFED), an Organised Crime Group (OCG) has been jailed for defrauding Insurers out of £1m. The group targeted 14 Insurers during a four year nationwide commercial property fraud (IFED’s biggest case of commercial property fraud). They had avoided detection by ensuring a Loss Adjustor didn’t attend the same venue twice.

Cyber insurance and Directors and Officers (D&O) Liability insurance go hand in hand now that company business models increasingly revolve around technology, according to a white paper published by Airmic with support from Marsh and AIG. Cyber incidents are dramatically on the rise, with AIG reporting as many cyber claims in 2017 as in the previous four years combined. There has been another significant jump so far in 2018 even before the impact of the General Data Protection Regulation (GDPR).

It looks like all is well at the European captives rated by A.M. Best. A new special report by the credit rating agency shows things have been steady through the past year, as most of the ratings have been affirmed while stable outlooks have been maintained. The 11-page document highlights the key rating considerations in A.M. Best’s building block approach as they apply to the European captives rated as of October 26, 2018.

Philanthropist Carole Nash OBE, Founder of her namesake motorcycle insurance Broker, was recognised as ‘Centenary Woman of the Year’ at the inaugural This Is Manchester Awards. Introduced to celebrate 100 years of female suffrage, the recognition was bestowed upon Nash at the Hilton Manchester Deansgate for her work in the region. Known for supporting a number of charities in the area, the awardee is patron to both the Alderley Edge Music Festival and Bowden Music Festival.

Enstar Group Limited has agreed another transaction with Maiden Holdings. Subject to regulatory approvals, the new deal will see an Enstar subsidiary in a retrocession agreement with Maiden Reinsurance wherein loss reserves of approximately US$2.7 billion associated with Maiden Re’s quota share reinsurance contracts with AmTrust Financial Services and its subsidiaries will be assumed by Enstar.

A familiar name is bringing a new operation to the UK. Markel Corporation has announced that its German insurance company Markel Insurance SE has received regulatory approval to operate a branch within the UK. Known as MISE for short, the German-arm was originally established to meet the insurance needs of clients that were either located in or had risk exposures within the European Economic Area. It was created on the back of Brexit and a UK branch is expected to offer support to Brokers and policyholders that underwrite exposures across the region. The company already boasts branches in both the Netherlands and Spain.

RSA Group is set to restructure its specialty and wholesale business, part of RSA Global Risk Solutions (GRS) in a move that could see around 50 redundancies in the business. The number of redundancies is not likely to be more that 50 but the final outcome is dependent on consultation and redistribution of people into new roles. A spokesperson said that the Insurer was consulting with staff members but is looking to redistribute roles where possible and is also creating new jobs. 

Aviva has taken the top spot for overall customer satisfaction for the second time this year in Brokerbility’s bi-annual member survey, according to the network. The latest edition of the Brokerbility Insurer Satisfaction Survey found that Axa and RSA took joint second place, while AIG achieved the highest overall improvement score.

In other news... Aviva is emailing customers after failing to follow renewal transparency rules. The issue has stretched across annually renewable general insurance products, including Home and Motor. The Insurer admitted that on previous renewal invitation emails it had not shown last year’s premium in a clear enough way and had not given enough prominence to the shop around message.

AXA has added Brexit cover to its Management Liability product (MLP). The Insurer noted that claims arising from the UK’s EU exit will be covered for Directors & Officers’ Liability and Company Legal Liability. It added that policyholders needing guidance will have free access to advice from its legal partner Rradar.

Backing up last year’s hat-trick of award wins, NMU has once again cemented their position in the market by scooping ‘Underwriter of the Year’ in the inaugural Broker Choice Awards, whilst being highly commended in the ‘Best Renewals Team of the Year’ category. The Broker Choice Survey asked Brokers to share their views on what they’d been most impressed by when it came to Insurer service in the last 12 months – the answers determining who made the shortlist.

Bruce Stevenson calls for industry-wide action on diversity and says all Brokers should have a specially appointed officer to drive change. Edinburgh-based Broker Bruce Stevenson has urged the insurance industry to take action on diversity and inclusion and the business has appointed a staff member to focus on encouraging this within the business. Nick Smith, Account Executive at the Broker, is also a Chartered Insurance Institute (CII) Diversity Officer and responsible for driving Bruce Stevenson’s inclusion plans. Speaking at the 2018 Una Conference on 15 November, Smith encouraged all Brokers to implement a strategy and to appoint a diversity officer to push it forward.

Bridge Insurance Brokers achieved £10.7m of turnover in the year ended 31 March 2018, a nine percent rise on 2017. The figure took the Manchester-headquartered firm through the £10m barrier having delivered £9.6m in 2016 and £9.8m in 2015. According to a filing at Companies House, profit after tax was up more than fivefold to £412,510 (2017: £72,973).

Thomas Carroll Group has bought the Monmouthshire Building Society’s personal insurance business for an undisclosed amount. The deal builds on Thomas Carroll’s purchase of the building society’s commercial business, Monmouthshire Insurance Services, which the Broker bought in 2016. The financial institution, which was established in 1869, will still offer services such as Home insurance. Thomas Carroll Group chairman John Moore noted: “We service a loyal and growing client base across Newport and the surrounding areas and are delighted to work with such a well-respected organisation.” The Broker has been running for 50 years and places personal and business insurances.

The British Insurance Brokers’ Association (Biba) has warned that “as things stand at the moment the arrangements do not work for insurance Brokers” in response to the Brexit deal. The agreement ahead of the UK exiting the European Union on 29 March 2019 was published yesterday (14 November) but Biba flagged it is still in draft form with no certainty of being adopted by Parliament. In particular the trade body highlighted the lack of a solution for UK Brokers trading with retail and commercial customers in Europe.

A study looking at the insurance buying habits of the Millennial and Generation Z market has learned that people of that age in the UK are “most likely” to not have any insurance cover. The research counted Millenials as being born between 1981 and 1996 and Generation Z as those with birth dates between 1997 and 2006. For those that do have cover, younger adults in the UK are more likely to have found their current Car insurance through an online search engine – like Google or Bing – than those in the USA or Canada.

Aviva is to donate £5 for Dementia for quotes received by 16th November. Through the Insurance United Against Dementia (IUAD) campaign, they have an opportunity to give people hope for the future by funding research into the care, cure, cause and prevention of dementia. As part of the Insurance Day of Giving, they are supporting the IUAD campaign and their target is to raise £10,000. For every genuine personal lines quote received on Fast Trade from Monday 5 November to 11:59pm on Friday 16 November, Aviva will donate £5 to the Alzheimer’s Society. This is across their Private Car, Your House, Home Plus and Your Van products now available on Fast Trade.

High Court win for Allianz customer in 'faulty bed sex claim'. Allianz has helped their customer win a high-profile case in the High Court that would have put their business in jeopardy had it gone the other way. In the much publicised "faulty bed sex claim", the claimant was seeking seven-figure damages from an incident involving a bed supplied by their customer Beds are Uzzz. When costs from both sides are factored in, the total figure would have reached approximately £12 million – well beyond the limit of indemnity on the policy.

Telematics insurance helps cut car casualties amongst 17-19-year olds by 35%. New analysis of the latest UK road casualty statistics by LexisNexis Risk Solutions has begun to uncover compelling evidence that telematics insurance has played a role in cutting claims costs for Insurers amongst the youngest, most vulnerable drivers, by helping to reduce casualties by over a third since 2011. Car casualty rates amongst 17-19-year-old drivers have fallen by 35%, compared to 16% for the driving population as a whole.  The one major difference between young drivers and their older counterparts is telematics insurance, with 4 in 5 young drivers estimated to have a telematics policy today.

Market Movers and Shakers

InsurTech welcomes Manjit Rana, Founder and CEO of innovation consultancy, Ingenin Ltd, as Managing Director for Corporate Innovation in Insurance, to lead the development and launch of a new range of corporate innovation products and services.

Canopius announces the appointment of Rachel Sabbarton as Senior Underwriter within the Energy team. Rachel joins from Beazley Group, where she was Deputy Head of Energy and will report to Geoff Tin before succeeding him in the role of Head of Energy in the summer of 2019.

BMS Group Limited, the independent specialist insurance and reinsurance Broker, announces the hire of Duncan Hayward as a Director in its Energy division. Hayward, who joins in 2019, will lead the casualty initiative within the Energy division. Hayward joins with 14 years’ experience in the insurance market, most recently serving as a Divisional Director at Price Forbes. Prior to that, he served as an Associate at JLT, having begun his insurance career as an Oil and Gas Broker at Agnew Higgins Pickering.

International General Insurance Holdings Limited, the international specialist commercial Insurer and reinsurer, has announced the appointment of Nasser Zagha to the newly-created role of Chief Technology Officer.

Recaredo Arias, Director General of the Mexican Association of Insurance Companies, has moved up from his role as vice president of the Global Federation of Insurance Associations (GFIA). Following a vote at GFIA’s annual general assembly, Arias emerged as new president of the federation – succeeding Dirk Kempthorne, who stepped down in August after leaving his President and Chief Executive post at the American Council of Life Insurers. Replacing Arias as GFIA vice president is Insurance Bureau of Canada president and CEO Don Forgeron.

Brit Chief Financial Officer Mark Allan is the new Chair of the Finance Committee at the Lloyd’s Market Association. Allan takes over the role from Liberty Specialty Markets CFO John Dunn. Meanwhile Hermien Smeets-Flier of Aegis London is succeeding Beazley’s Martin Bride as the committee’s Deputy Chair.   

It was only in April that claims management giant Sedgwick named a new Chief Executive in Ireland… now the firm has snapped up one of the country’s longest established independent specialist Liability loss adjusting practices. “Sproule Graham will add considerable experience, expertise and a strategic geographic footprint to our market-leading Casualty loss adjusting operations,” noted Sedgwick Ireland CEO Malcolm Hughes.

Right Choice Insurance Brokers  Founder and Managing Director Michael Paul Joseph is now a Non-Executive Director at Lionsgold Limited. The gold company – which is focused on the exploration, production and retail application of physical gold, including its development as a currency – has tapped the insurance boss to come on board effective immediately.


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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