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General Insurance Newsletter Friday 25th January 2019

24 Jan 2019

Insurance News

Aston Lark has bought Dublin-based Broker Robertson Low for an undisclosed sum. The move, which is the first international move for Aston Lark, is subject to approval by the Central Bank of Ireland. Robertson Low was established in 1995 and according to the company, was Ireland’s first fully licenced Lloyd’s Broker.

Typical home combined buildings and contents insurance policies increased in price by 0.4% in 2018, The AA has calculated. The yearly total was far lower than the 5% seen in 2017. The small climb, to £163.38, came after a 0.9% bump in the final quarter of the year. This, along with a rise in the second quarter, more than wiped out the falls in the first and third quarters of the year.

In other news... The average cost of an annual comprehensive car insurance policy rose by 2.7% in the final quarter of 2018 to £609.93, according to The AA’s British Insurance Premium Index. It was the first rise recorded by the Shoparound research since the second quarter of 2017 when prices hit a record £693. However, despite the three months uplift the measure was still down 5.9% over 12 months due to the falls in the previous quarters.

Furthermore... The cost of motor insurance fell in 2018, the first calendar year fall since 2014, according to the Association of British Insurers latest Motor Premium Tracker published (24th January 2019). According to the association, the fall came despite a rise in the average premium paid in quarter four last year over the previous quarter, in line with the seasonal trend.

Markerstudy has completed the long-touted deal for Co-op’s underwriting business and signed a 13-year agreement to distribute Motor and Home insurance products for a total of £185m. Co-op’s plan to sell CIS General Insurance was first rumoured in August last year with Markerstudy tipped in November as the most likely buyer. According to the Co-op it will now focus on providing “a broader range of insurance products” through Co-op Insurance Services.

Zurich has backed Travel insurance start-up Pluto, which aims to challenge the market by offering “Travel insurance for people who don’t like insurance”. The Insurer will provide the underwriting and claims capacity for the InsurTech firm which claims its mobile-focused offering provides customers with a quote in around 60 seconds or three minutes when a customer is building their own policy. The start-up was set up in order to decrease the number of millennials who travel without insurance.

Davies Group has bought Claims Equilibrium Club’s sister company TopMark Claims Solutions (TMS) for an undisclosed sum. The move follows Davies’ acquisition of Direct Group’s claims business which it purchased from Ardonagh Group in October last year for £36m. According to a statement, the remaining TopMark Group companies which include TopMark Adjusters, TopMark Claims Management and Claims Equilibrium Club are not affected by the deal.

AXA XL has announced that it has completed the transfer of its European Union (“EU”) insurance company, XL Insurance Company SE (“XLICSE”), from the UK to Dublin, Ireland. XLICSE is a wholly owned subsidiary within the AXA XL division of AXA Group providing insurance within Europe and Asia operating through an international network of branches, subsidiaries and third-party Partners.

Modern business pressures, hugely burdensome remits and continuous regulatory changes are exposing Senior Business Executives like never before to liability claims. Research by QBE Business Insurance found that the risk of prosecution, bankruptcy and jail terms is now firmly on the agenda. According to the findings, 1 in 4 (23%) senior decision makers have had a claim made against them at least once in their capacity as a senior Manager, while a third (32%) admit to concerns about a claim being made against them in the future.

Santander UK – whose products include loans, mortgages, savings and insurance – is closing 140 branches across the country throughout 2019. The financial services firm said the number of transactions carried out through its branches has fallen by 23% over the past three years – a stark contrast to the 99% growth in those conducted via digital channels. With the nationwide network ‘reshaping’, Santander’s branch count in the UK will be reduced to 614. According to the announcement, what will be left is a combination of larger branches with improved community facilities and smaller ones that use the latest technology. Also, through an investment of £55 million, a total of 100 Santander branches will be refurbished over the next two years.

There’s a new division at what is described as the largest insurance Broker in Nottingham. Building on its existing healthcare provision, Russell Scanlan has created a business protection and healthcare unit which encompasses traditional private medical insurance, health and wellbeing support plans and business protection policies. It will be headed by business healthcare Manager Chris Cunnington, who has specialised in private healthcare and employee benefits for more than two decades.

Last month London and International Insurance Brokers’ Association Chief Executive Christopher Croft noted the progress in electronic placement adoption – citing increases across risks, Brokers and risk classes. Now global reinsurance, wholesale and specialty Broker Ed has announced its own Placing Platform Limited usage rate. Supporting the call to publish PPL league tables, Ed said it placed 67% of firm orders through the electronic placement system between August and November last year.

The Global Federation of Insurance Associations has provided its feedback to the Organisation for Economic Cooperation and Development regarding its next steps on cyber issues. According to the GFIA, the Cyber insurance market is an important resiliency tool with many ancillary benefits. Each year, the market continues to grow responsibly as Insurers innovate and address consumer needs and market demands.

Arconic Inc, which supplied Grenfell Tower’s notorious cladding, is no longer selling the entire firm. The US manufacturer – whose other businesses include aerospace, automotive and energy – was previously cited as being in talks with Apollo Global Management for the deal. Now Arconic, without naming the private equity company, has released an update saying that it has decided not to pursue the potential sale. Part of Apollo’s reported offer would have supposedly covered liabilities linked to the 2017 Grenfell Tower blaze – the insurance bill for which was touted at the time as possibly the largest ever in Europe.

The Inclusive Behaviours Pledge has welcomed another signatory and it’s said to be the first from legal circles. Set up by Lloyd’s of London and Zurich to promote diverse, inclusive and tolerant practices across the insurance industry, the initiative is supported by the likes of Aviva, AXA, Brit, Chubb, CNA Hardy, Direct Line Group, Hiscox, JLT, QBE, RSA, The Ardonagh Group and Tokio Marine Kiln. Now insurance risk and commercial law firm BLM has come on board, joining over 100 organisations. Describing itself as the first law firm to sign up, BLM has committed that its people will be treated not only with respect, courtesy and dignity but also in a manner free from discrimination and objectification.

Smart cities are entering a new phase, as not only are city leaders readily installing digital solutions to improve efficiencies, such as cutting down the minutes spent on a daily commute, but residents are now able to use their smartphones as the keys to the city that unlock further capabilities by injecting additional data into the ‘smart’ ecosystem, according to a 2018 report from the McKinsey Global Institute. Smart cities are also spreading from the major metropolitan areas where they’ve typically originated to smaller locales. However with new and improved services come new risks as well, as smart city technology continues to spread across continents. As a result of this recognition and recent cyberattacks targeting cities, small towns are realising that they need some kind of Cyber data compromise insurance.

Ageas UK has confirmed it is ending its partnership with Vauxhall and will cease accepting new business arising from the deal at the end of May 2019. The provider detailed in a statement that it will stop servicing existing Vauxhall customers by the end of May 2020. Ageas has been providing fully branded Motor insurance products to Vauxhall’s UK customers since 2011.

In other news... Details have emerged of Ageas’ plan to close two of its branches in a move that may hit up to 597 staff. A leaked document, sent by UK CEO Andy Watson to staff, explained the thinking behind the closure of Port Solent and Stoke-on-Trent. It also revealed plans to downsize and move its London, America Square office and seek an alternative Manchester base.

 


Market Movers and Shakers

GRP hub Broker Green Insurance has recruited Rob Ashburn as Managing Director. Green Insurance is based in Bexhill Sussex, with a team of 80 staff located in branches around the South East of England. Rob has over 20 years of broking and senior management experience, most recently as Trading Director of Towergate’s SME Division.

A familiar face is back at RSA Group. Karen Caddick, former HR Director of RSA’s personal lines brand MORE TH>N, has been tapped to take on a bigger role. Appointed as group and UK HR Director, Caddick is succeeding Cathy Lewis who will be retiring from Executive work this year. The major arrival made the switch from Saga Plc where she served as group HR Director from 2015. At RSA, she previously worked in the UK and international business from 1993 to 2001.

Lockton Re has appointed Jerry Ridge to take the reins when current Head of Reinsurance George Carrington retires this spring, the company has announced. In his new role, Ridge will lead Lockton Re’s reinsurance professionals across the US and the UK. He will also continue to oversee the company’s Marine and Energy reinsurance practice. Ridge joined Lockton in June of last year. He has 37 years of experience in the reinsurance industry and served as Chairman of global specialty reinsurance at Willis Re prior to joining Lockton. He has also served as co-CEO of Willis Re Specialty and Managing Director of Willis Re Global Marine and Energy.

Andrew McKee, who became Chief Executive of Cathedral Underwriting Limited in June 2017, is stepping down at the end of the month. Parent firm Lancashire Holdings Limited said CUL Compliance Director Emma Woolley, who came onboard two years ago, will be taking over as CEO. She brings more than 20 years of London insurance market experience to the role. The appointment is subject to all relevant regulatory and governance approvals. “I am delighted to see Emma assume the role of CEO at CUL,” commented Lancashire Group Chief Executive Alex Maloney. “She has already established herself as a valued member of the Cathedral management team and is a respected member of the CUL board. “I would also like to thank Andrew for his contribution to CUL and the wider group. I wish him well for the future.” The reason for McKee’s departure was not disclosed.

There will soon be a new face at AXA UK. Incoming is Shali Vasudeva who joins the firm from Hiscox to take the role of Chief Operating Officer with the goal of simplifying the company’s operations. She is set to lead a transformation office to support the operating companies’ efforts. Vasudeva will move into the newly created role on March 2019. She brings with her a strong reputation in the sector, having led group-wide change at Hiscox. In addition, she also spent seven years at Prudential, working as its Executive Director of operations and will now report to new AXA UK and Ireland CEO Claudio Genial. 

Tokio Marine Holdings, the Japanese parent firm of UK-based Tokio Marine Kiln and US-headquartered Tokio Marine HCC, has announced upcoming changes to its board of Directors. First off, current Chairman of the board Shuzo Sumi is leaving the Property and Casualty insurance giant after nearly five decades. Sumi, whose resignation is effective when the company’s shareholders meet in June 2019, has been with Tokio Marine since 1970. The outgoing chair will be succeeded by President and Group Chief Executive Tsuyoshi Nagano, who came onboard in 1975. Replacing him as president and CEO is Senior Managing Director Satoru Komiya, who will also succeed Nagano as Chair of Subsidiary Tokio Marine Nichido. Board changes at the holding company also include the resignation of Director Toshifumi Kitazawa, who will become Vice Chair of Tokio Marine Nichido where he currently serves as President & CEO. Taking over his position at the subsidiary come April 2019 is Shinichi Hirose, who is also moving up to a Director role at the parent firm where he is senior Managing Executive Officer at present. Meanwhile a Reuters report said Komiya has pointed to an active pursuit of overseas mergers and acquisitions in efforts to expand geographically.

 

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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