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General Insurance Newsletter - Friday 22nd June 2018

22 Jun 2018

Insurance News

AXA Insurance, with the help of international law firm DAC Beachcroft, has been awarded exemplary damages in its Court of Appeal battle against perpetrators of what Lord Justice Flaux described as “a sophisticated and sustained fraud.” Announcing the victory, the Insurer noted that the AXA Insurance UK Plc v Financial Claims Solutions Limited and others case involved a mixture of ghost broking, policy inception fraud, bogus claimants, forged witness statements, made-up medical reports and a sham solicitor. The large-scale personal injury claims scam, which was discovered by AXA in 2014, operated through fake law firm Coelum Legal. In the first instance, it was ruled that AXA was entitled to its costs but not to exemplary damages – even with the claims being called “rotten to the core” by a High Court judge.

The £54m of UK domestic Trade Credit insurance claims paid out in the first three months of 2018 was a record for the first quarter of a year, the Association of British Insurers (ABI) has revealed. The trade body noted that the number of claims made by UK firms in the quarter to cover non-payment of debts was at its highest level since 2009. According to the association, there were 3,966 notifications of new Trade Credit insurance claims, up by 50% on the previous quarter as the insolvency of Carillion hit. This equated to 44 new claims every day.

Dual Asset Underwriting has launched Aircraft Title Insurance to join its legal ownership insurance services. The provider has partnered with US firm AIC Title Service to launch the policy in the UK and across Europe which will mainly be sold through Brokers. It detailed that the product insures buyers and/or the financiers of aircraft for a wide range of legal ownership risks, including: fraud and forgery; unknown debts secured against either the aircraft or its engines or propellers; third parties claiming to have a better ownership right and outstanding rates, taxes, charges and other levies, which often affect aircraft.

Car Insurance 4 u staff found out that a clone firm was using their trading name after potential customers contacted them about quotes they had received on Facebook, according to the Broker’s General Manager Clive Jones. The Financial Conduct Authority (FCA) issued a warning on 14 June stating that fraudsters were using details of authorised Motor Broker Car Insurance 4 u in order to convince people they worked for a genuine company. The clone firm is operating from a Facebook page and has a mobile telephone number.

Property and Casualty (re)insurer Sompo International has something new for clients in Europe. The Bermuda-based provider, which earlier this year revealed that it was setting up a European speciality insurance underwriting operation in Barcelona, has expanded its Professional Lines offering with the rollout of a programme designed for parties on either side of a merger or acquisition transaction. The transaction risk proposition provides coverage against losses arising from the likes of warranties and indemnities breaches.

Old Mutual Plc, the international financial and insurance group, which last week announced the price range for the London Stock Exchange primary listing of its UK wealth management business, is nearing the finish line for its split initiated in 2016. Quilter – formerly known as Old Mutual Wealth – is slated for a June 25 Initial Public Offering, in a move to cement its separation from Old Mutual’s operations in South Africa. The price range for the global offer has been set at between 125 pence and 155 pence per share, with the final offer price expected to be revealed on or about the above mentioned date. 

New research by Thomson Reuters, based on a survey of Finance Directors at the top 100 law firms in the UK, has found an increase in the number of those interested in going public. A report has revealed an insurance law firm is about to take the flotation route – to the tune of £1bn. According to the report, Manchester-headquartered DWF LLP is slated to be listed on the London Stock Exchange within the year, in what was described as the largest initial public offering (IPO) ever in legal circles. It would be bigger than the expected figure for Knights (over £100m), which has announced a June IPO. In the UK, so far only four law firms have become publicly-listed – Gateley (June 2015), Gordon Dadds (July 2017), Keystone Law (November 2017) and Rosenblatt Solicitors (May 2018).

Insurtech firm Lemonade Insurance Company has filed a lawsuit against ONE Insurance, its parent Wefox Group and founder Julian Teicke, over claims of it copying Lemonade’s app and website. The filing accuses the defendants of copyright infringement, breach of contract, and violation of the Computer Fraud and Abuse Act.

A new report, published by AXA Insurance and UK law firm Burges Salmon as part of the VENTURER project, is calling for better consumer understanding of autonomous vehicles – urging legislators to define “driverless” technology, in particular SAE Level 3, or conditional automation, as it is seen as the most potentially confusing.

Clear Insurance has posted profit before tax of £2.3m for the year ended 31 October 2017 an increase on the £2m achieved in the previous year. Documents on Companies House showed that turnover also went up to £13.9m from £12.7m in 2016. Clear made two acquisitions in the 12 months: Genavco Insurance and Robert Alexander. These were reported to have a combined cost of £3.1m. They followed the deal in March 2017 to buy MPW Insurance Brokers . This remains Clear’s biggest purchase so far and the 2017 results showed an estimated goodwill cost of £9m (subject to earnout). The Directors noted that they hope to complete another £900,000 turnover acquisition in the near future. The results also revealed that the Broker, which was previously loaned £13m by Clydesdale Bank, has £5.8m remaining in the pot to spend on acquisitions.

Thomas Carroll Group has reported a 23% rise in profit after tax to £1.53m for the year ended 31 December 2017. The double-digit increase built on the leap in 2016 when profit after tax hit £1.25m. According to results filed at Companies House, turnover nudged up by 4% from £9.68m to £10.09m.

It has been revealed MS Amlin has pulled out of the UK Household market. The Insurer has exited UK Household, which served mid and high net worth clients, and offered renewals up until 31 May 2018. The line has been put into run-off. A spokesperson for MS Amlin declined to comment. It is believed the Insurer will continue to offer Yacht and Equine cover. Its household binder agreements will also continue for a limited period. The Household business is also set to keep some affinity relationships and schemes.

SSP is offering its Brokers software to enable them to check if potential clients appear on national or international sanctions lists. The software house is working with provider Northdoor to integrate the IT security specialist’s software into its platform. According to SSP the partnership will make it simpler and quicker for SSP’s Brokers to check whether individuals or companies appear on the major national and international sanctions lists, plus any user-defined lists.

Brunel Professions, part of Bristol-headquartered Brunel Group, has been accredited as a Lloyd’s registered Broker. The Broker said the agreement will enable it to access the largest specialist insurance market in the world.

Axa has extended its capacity arrangement with GRP’s south-eastern hub Broker Green Insurance. The deal comes after GRP split with insurer Aviva and the insurer cancelled agency with all of the consolidator’s Brokers. The agreement sees Axa take on the agency for Greens’ Commercial Combined and Fleet business portfolios, as well as some contractors business.

The Allianz CEO, Oliver Bäte, is targeting a big UK acquisition, market reports have suggested. It was reported that Aviva and RSA were named as potential targets and stated that Bäte has been working with investment bankers for several months to develop a “hit list”. Zurich and QBE were also said to be in the frame.



Market Movers and Shakers

It has been announced that Grahame Chilton will be stepping down from the CEO post of Gallagher’s UK-based brokerage and underwriting division before the end of the year.

It has been announced that Ian Thompson will join Thistle Underwriting as Senior Construction Underwriter and brings with him over 15 years’ experience in the industry.

BGL Group, a leading digital distributor of insurance and household financial services has announced the appointment of Debbie Hewitt as its new Non-Executive Chairman.

Saga has appointed Rachel O'Flaherty to the role of Director of Marketing, for Saga Services.

Barbican Insurance Group has announced the appointment of Lauren Webb as a Class Underwriter for Cyber within Lloyd’s Syndicate 1955.

Bishopsgate Insurance has announced the appointment of Chris Meredew as Director UK and International liability, Oil and Gas and Marine Trades.

Aon Risk Solutions in the UK has confirmed the appointment of Richard Moxon as Head of UK Claims. 

The Ardonagh Group has announced the appointments of Diane Cougill as Chief Financial Officer and Sarah Dalgarno as Chief Risk Officer.

A-One Insurance Group (AOIG) has recruited two new specialists to boost its Head Office team at Ringwood. David Staddon joins as an Account Handler and Nick Magee has joined as a Trainee Account Executive.

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

Meet our specialist General Insurance team here.

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