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General Insurance Newsletter Friday 19th February 2021

19 Feb 2021

In a recent report by PwC UK, they point to a likely decrease in the cost of Home and Motor insurance this year. “For 2021, due to the economic impact of the pandemic and competition in the home and motor market, we are forecasting insurance premiums to drop by 5%-10% for those who shop around for motor insurance and 4%-8% for those who shop around for home insurance,” said Mohammad Khan, General Insurance Leader at PwC UK.

Property & Casualty underwriter Argo Group International Holdings, Ltd. has reported losses both in the fourth quarter and full year 2020, following the company’s poor showing in 2019. They announced an Underwriting loss of US$109.6m for FY2020 and US$46.8m for Q4 2020.

The fourth and final industry loss footprint for extratropical cyclone Dennis has been released by European catastrophe insurance data firm PERILS. Based on data from affected Insurers, PERILS estimated the Property market loss at £304.17 million, compared to the previous loss estimate from August 2020, which was at £299 million.

Insurance giant American International Group Inc (AIG) has revealed it has been fielding inquiries from companies considering buying a stake in the life and retirement (L&R) business which the Insurer is seeking to divest. Citing the words of AIG president Peter Zaffino during a conference call with analysts, Bloomberg highlighted that AIG has received inquiries from parties interested in a strategic alignment and in potentially purchasing the 19.9% stake in L&R.

In other news...American International Group, Inc. (AIG) has reported a full-year 2020 net loss attributable to AIG common shareholders of US$6 billion (approx. £4.3 billion) – a monumental shift from the Insurer’s net income of US$3.3 billion in the prior year. The Property & Casualty (P&C) insurance giant has attributed this near-US$9 billion drop in income to its sale and deconsolidation of Fortitude Group Holdings LLC (Fortitude) on June 02, 2020, which resulted in a US$6.7 billion after-tax loss.

ROCK Insurance Group is diversifying and opening up wider distribution networks with the launch of underwriting agency Tigon Cover Services Limited. Formed to provide insurance products to the UK Travel and Broker markets, Tigon currently has three offerings – COVID-19 cancellation cover for tour operators; cancellation cover including COVID-19 for consumers; and travel insurance.

Willis Towers Watson (WTW) has hired the entire team of Jobable, a Hong Kong-based human capital analytics and software company. The move, according to a statement from the global brokerage, expands its capabilities in human capital data science and software development. This will enhance the company’s ability to help organisations drive digital transformation and harness the potential held by their human capital data.

Apollo Syndicate Management and legacy acquirer Compre have partnered to launch a new Lloyd’s legacy business Syndicate 1994, which recently received approval from The Council of Lloyd’s. This is Compre’s first Lloyd’s transaction, and involves the acquisition of Apollo Syndicate 1969’s 2017 and prior years of account, it said in a statement. The RITC agreement also includes the transfer of around US$125 million of reserves to Syndicate 1994.

British insurance giant Aviva is reportedly in advanced discussions regarding the sale of its Italian operations, as it continues to push ahead with around €6 billion (approx. £5.23 billion) of divestments. 

The Chartered Insurance Institute (CII) and the Personal Financial Society (PFS) have joined forces with the Institute for Apprenticeships and Technical Education (IfATE) to look for financial advisers and paraplanners who will review the profession’s apprenticeship standards.

With the International Underwriting Association of London (IUA) now chaired by Robert Kuchinski, the Zurich UK commercial insurance head will also replace Patrick Tiernan as IUA’s representative at the London Market Group (LMG) board.

Global Reinsurer Swiss Re Group has become the latest to report its year end results for 2020 and has posted a net loss of $878 million (approx. £628.2 million) compared to a profit of $727 million (approx. £520.2 million) for year end 2019. The Reinsurer highlighted, however, that excluding COVID-19 claims and reserves (pre-tax) of $3.9 billion, the group’s net income rose to $2.2 billion with a return on equity of 7.3%. Swiss Re noted that 2020 saw strong underlying growth for the business with gross premiums written up 2% year on year, and premiums earned and fee income up 6% from 2019.

NN Group NV, the largest Dutch insurance company, posted a 2020 operating profit of €1.89 billion (about £1.64 billion), exceeding expectations on the back of improved investment margins and the easing of the impact of COVID-19 in the second half of the year. The company’s annual profit exceeded the €1.79 billion reported for 2019 and beat average analyst estimates of €1.7 billion, according to a Reuters report.

 

Remember the iconic underwriting room at Lloyd’s of London? Now picture it differently, with the future (and what it might require) in mind. That is what the insurance marketplace is asking stakeholders across the globe to do, with an online collaboration hub set up to crowdsource insights and ideas to “re-imagine” the Lloyd’s underwriting room. An initial crowdsourcing, which runs until February 28, is part of a market-wide consultation spanning initiatives such as virtual focus groups.

FBD Insurance, which lost in the Irish test case against insured publicans, has reportedly begun offering initial compensation to affected business interruption policyholders. A report by The Sunday Times said the Insurer is handing out an interim 5% payout for starters. Meanwhile, the High Court in Dublin, according to the publication, is expected to this week issue clarification on loss calculation.

 

The COVID-19 pandemic failed to put a huge dent in insurance M&A activity for 2020, with more deals expected to come in 2021, according to a report by global law firm Clyde & Co.

The life and investment operations of Charles Taylor Group in British Crown dependency Isle of Man has now officially come under the umbrella of Monument Re Limited. First announced in 2020, the sale – financial terms of which remain undisclosed – received not only regulatory approval from the Isle of Man Financial Services Authority but also non-objection from the Bermuda Monetary Authority.

It’s not GRP’s first deal of 2021 but it is certainly its biggest so far, as the insurance intermediary has revealed it has entered an agreement to acquire Marsh’s UK Networks business. The terms of the transaction, which is subject to regulatory approval, have not been disclosed and completion is expected by Q2 2021.

Insurance software giant SSP Ltd has announced that regulatory approval for its acquisition by The Volaris Group (Volaris) has been granted by the Financial Conduct Authority (FCA). It was in December of last year that SSP first revealed that it was to be acquired by Volaris, part of Constellation Software Inc., pending mutually agreed closing conditions.

Resilium Insurance Broking Pty Ltd – the Australian broker that became a standalone business in June 2019 after it was sold by Suncorp Group through a management buyout led by Chief Executive and Managing Director Adrian Kitchin – has come under the umbrella of another giant. It’s been announced that The Ardonagh Group, which is touted as the largest independent insurance Broker group in the UK, has acquired a majority stake in Resilium for an undisclosed sum. In a release, Resilium said the investment will allow it to accelerate the company’s growth plans for 2021 and beyond.

Miller Insurance Services LLP’s sale, which was examined through the European Commission’s (EC) simplified merger review procedure, has secured the green light from the European Union (EU) watchdog. Under the merger regulation of the EU, Miller and its buyers are granted approval after it was concluded by the EC that “the proposed acquisition would raise no competition concerns because of the limited market position of Miller in the European Economic Area.”

 

Swiss Re Corporate Solutions has appointed Andrew Dougall to the role of Global Head of Casualty. In his new leadership role, Dougall will be responsible for driving the success and profitability of the company’s bespoke Casualty portfolio globally. 

Come April, Exeter Friendly Society Limited – better known as The Exeter – will be led by Chief Executive Isobel Langton. Succeeding Andy Chapman, Langton brings three decades of insurance industry experience to the health and protection Insurer. She most recently served as CEO of the intermediary division at Royal London.

Mark Dixon has joined Allianz Holdings Plc – the holding company which owns the principal insurance operations of German group Allianz SE in Great Britain – as Group Financial Controller. In his new role, Dixon will head up financial reporting and control activities for the group, which consists of Allianz Insurance and LV= General Insurance.

Willis Re has hired Michel Büker to take up a dual role as Head of Lloyd’s Capital, Willis Re Specialty, and Head of Production, Customised Solutions for the EMEA region. According to a statement from the Reinsurance broking arm of Willis Towers Watson, Büker will be responsible for extending the company’s relationships with the Lloyd’s sector and assisting the specialty team in developing bespoke solutions for clients.

Specialist insurance buyer Mactavish has hired Tom White to serve as the company’s newest Head of Corporate Customer Solutions. In the role, White will be responsible for designing and arranging complex insurance programmes for Mactavish’s corporate customer base. 

Lloyd’s broker Price Forbes & Partners Ltd is adding four senior members to its global aviation unit. The specialist practice, which has grown more than fivefold since taking off in 2012 with just four people, will be joined by Executive Directors of Aviation Michael Moran and Gordon Middleton, as well as Aviation Director Lee Dove and Executive Director of Aerospace David Sales.

 

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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