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General Insurance Newsletter Friday 28th February 2020

28 Feb 2020

2019 was a mixed bag for Allianz UK which completed its purchase of the general insurance businesses of LV= and Legal and General, positioning Allianz Holdings as the second largest general Insurer in the UK, but reported that its GWP and operating profit were both down from 2018 figures. On the back of the group results, Allianz UK has now revealed its figures for 2019 showing that after a challenging fourth quarter, it has an overall combined ratio of 97.8% and premium income is down from £2038.2 million in 2018 to £1990.7 million in 2019, impacted by strong underwriting action taken on under-performing business lines.

It was recently announced that Zurich-owned Navigators and General (N&G) is acquiring NMU’s ex-GJW (Groves, John and Westrup) commercial Marine trade combined book. While NMU is very much here to stay in the Cargo market and has assured Broker partners that it will be business as usual in that sector, its commercial Marine trade combined book will move across to N&G at renewal, staggered across the year.

In further news...Zurich Insurance Group and cybersecurity company CYE have partnered on an offering to protect businesses against Cyber crime. Zurich Cyber Security Services addresses Cyber risks by helping businesses define and implement effective Cyber risk management programs, the company said. The offering combines Zurich’s specialty Cyber insurance and risk engineering with CYE’s artificial intelligence-based technology, services and expertise.

The data of over 10.6 million individuals who were guests at MGM Resorts hotels has been left exposed on the dark web, potentially for hackers to abuse. Leaked data includes guests’ names, addresses, phone numbers, emails and birthdates. The exposed files – which were posted on a hacking forum – not only gave away the details of regular tourists, but also the information of visiting celebrities, CEOs, reporters, tech company employees and even government officials. Notable people whose data has been found among the exposed files include Twitter CEO Jack Dorsey and singer-songwriter Justin Bieber.

CETA has been in the business of providing pioneering insurance solutions since 1993 when the floppy disk was, to many, the pinnacle of digital innovation. Technology has moved on substantially since then and the company has too, recently repositioning its non-standard Property insurance product on its digital trading platform, Infinity. CEO of CETA, John Bibby, who has worked within the insurance sector for many years and seen the range of digital transformations which have occurred specifically within the broking space, is acquainted with the problem of implementing technology for technology’s sake.

Environment and natural resource economist Helen Jackson, an associate fellow at think tank Bright Blue, has published a report highlighting the limitations of the Flood Re scheme. “To tackle moral hazard, Flood Re was limited to only covering properties built before January 01, 2009,” noted Jackson, whose analysis found that about £31 billion worth of at-risk properties have been built since 2008. The Bright Blue associate fellow asserted: “There is no legal requirement to provide flood risk information to homebuyers, although the Law Society publishes guidance on good practice in informing clients of flood risk during conveyancing.".

“Disruptions will not only be confined to the retail industry, with parties in the maritime sector already seeing the effects.”. Those were the words of Jonathan Moss, Head of Marine and Trade at UK-headquartered law firm DWF, while shining a spotlight on the repercussions of COVID-19 on the shipping insurance industry. According to Moss, while retailers are being hit by supply chain disruptions due to factory closures across the virus’s originating country, ports are witnessing severe under-staffing. 

Berkshire Hathaway Inc. may have bounced back big-time in the fourth quarter of 2019 – from a US$25.4 billion net loss in the same quarter in 2018 to net earnings attributable to shareholders of US$29.2 billion this time around – but the same can’t be said about the group’s insurance underwriting result. In a release over the weekend, the multinational conglomerate reported an operating loss of US$857 million for insurance underwriting. Berkshire’s insurance investment income; railroad, utilities and energy; and other businesses all posted operating earnings in the quarter.

The Financial Conduct Authority (FCA) has removed Triton Insurance Brokers Ltd’s permission to conduct regulated business in the UK, including arranging insurance contracts. Reasons for the action – which may be subject to challenge by the Grimsby-based insurance Broker – were not cited. However, it is outlined on the Financial Services Register that Triton must provide the regulator with a detailed statement of all insurance policies it brokered from January 31, 2019, as well as refund the insurance premiums that the company has not remitted to insurance firms.

CPP Group UK has partnered with Gallagher to offer Cyber cover to SME clients. The product includes a 24-hour helpline, antivirus software, cloud hosted back-up storage and access to IT and PR support if an incident occurs. It also offers protection against any liabilities arising from a cyber-attack or breach of data protection laws.

Start-up bicycle Broker Laka is set to expand its product range, according to Co-Founder and Chief Executive Officer, Tobias Taupitz. Taupitz said that the business is currently developing a recovery, health and well-being product for cyclists, but added that it is also looking at expanding outside of cycling and sports.

Research by Consumer Intelligence has found that home insurance premium costs have gone up 2.9% in the last six months. The organisation attributed the rise to the increasing nature and ferocity of the 2019-20 storm season. The analysis detailed that across the market, average overall premiums sit at £149. Average premiums for the over-50s rose 3.5% in the last 12 months and sit at £139, while average premiums for the under-50s rose at a slower pace of 3.1%. A typical average premium for this group now stands at £158.

Stakeholders saw it coming, but an announcement by the Ministry of Justice that the implementation of the government’s whiplash reform programme would be delayed further and Insurers and trade groups have been quick to weigh in. Among the first to sound off following the news was AXA Managing Director of Underwriting & Technical Services David Williams, who wasn’t really surprised to hear about the date change. “The delay to the reforms has felt like the worst kept secret for some time,” commented Williams. “The longer things went on without clarity on the procedural rules, the less likely it was that the April launch would be achieved.".

Traveller Assist, a provider of medical and security assistance in complex environments, has been appointed claims and assistance provider for a new Defence Base Act (DBA) provided by Chubb. All US government contractors and subcontractors working abroad on military bases are required to carry DBA workers’ compensation insurance to cover illness or injury among their employees.

London-based insurtech Aventus now has £2.6 million to spend on scaling up the business after closing an investment round led by Outward VC and Notion Capital. “We believe insurance, like other areas of fintech, is shifting from ‘build vs buy’ to an operating system approach,” stated Outward VC co-head Kevin Chong, lifting the lid on their backing.

Britain wants “legally binding” obligations on access to the European financial market, in conjunction with arrangements for maintaining trust as rules evolve. Despite being Europe’s largest financial centre, London is currently facing being locked out of its biggest export market for services such as banking, insurance and asset management if there is no access to the EU from next January.

Innovation can come from the most unexpected of places and perhaps the last place you would expect digital innovation within the insurance sector to develop is a law firm. And yet, with the launch of its separate technology-driven arm, Kennedys IQ, global insurance law firm Kennedys has placed itself among the most transformative digital companies impacting the development of the insurance sector. Head of the Innovations Group at Kennedys and Board Director of Kennedys IQ, Richard West, outlined how the unveiling of Kennedys IQ, which combines human and machine intelligence to offer clients ‘Kennedys, without the lawyers’, has been a natural next step in producing innovative software for clients.

Covéa Insurance colleagues whose new babies are born this month onwards will now be offered six weeks of fully paid paternity leave.“By increasing paternity leave to six weeks’ full pay, new dads working at Covéa Insurance will be able to focus fully on their new baby and partner during the crucial first stage of their child’s life.” said People Director Lisa Meigh.

Results season continues with RSA Insurance Group Plc publishing its 2019 preliminary financial figures. According to the London-headquartered group, it recorded £383 million in profit after tax for 2019 – an improvement from 2018’s £372 million. Underwriting profit, meanwhile, grew from £250 million previously to £346 million this time around.

Sedgwick has announced that its founder, Robert Young, passed away on February 20; he was 83. Young founded a small claims company called National Compensation Services in San Francisco in 1969. That company eventually grew to 500 people and became a major player in the insurance industry. Young later retired in 1996, turning leadership of the company over to Dave North.

It’s all systems go for Lloyd’s of London’s transformation plan, the first phase of which will begin next month. “We are now ready to start building the Future at Lloyd’s, having achieved three major objectives – securing finance, setting the governance structure and detailing the plan for the next 12 months and beyond,” said Lloyd’s Chief Executive John Neal when the centuries-old insurance marketplace released Blueprint One: Update, which outlines what’s been achieved so far, 2020 priorities for Lloyd’s and Phase 1 execution plans.

 

 

Technology systems provider SSP is banking on a company stalwart ahead of the launch of the SSP Broking platform, promoting Peter Gregory to Broker Business Director.

Aston Scott Group Founder Andrew Scott has invested in Broker Insights and been appointed as an Advisor to the board. Scott became an independent consultant in 2015 when Aston Scott completed a management buyout which saw Peter Blanc join the business. The Broker later rebranded to Aston Lark after merging with Lark in 2017.

It was in January when it was announced that Lloyd’s of London Performance Management Director Jon Hancock would be leaving the insurance marketplace… now we know where’s he’s heading this spring. Hancock, the man behind the resetting of the performance agenda at Lloyd’s, will be moving to American International Group (AIG) to serve as Chief Executive of International General Insurance. His appointment will see the industry stalwart come onboard the general insurance executive leadership team at AIG.

Mike Jarrett, CEO of Thomas Miller Americas, is about to set sail on a new chapter in his life – bringing to an end his four-decade voyage with the international transport and Professional Indemnity specialist. Jarrett has officially retired after 27 years leading the company from the New York and New Jersey offices and will be replaced by Leo Kirchner – as we originally revealed on our US sister site back in December - who will hold the dual role of CEO and President, managing the firm’s full range of operations.

AXIS Capital Holdings has revealed that Chairman of the board and Co-Founder Michael Butt, OBE, will retire from the company.

Miles Taffs is coming onboard international (re)insurance Broker UIB in his capacity as Deputy Managing Director of Aviation & Space.

Dawn Miller will be the new country President for Switzerland at Chubb effective March 01. To be based in Zurich, Miller is succeeding Florian Eisele, who has been named Senior Vice President Director for accident & health in Continental Europe.

Former CNA Hardy Director and HR Business Partner Claire Parkinson is making the switch to Lloyd’s managing agency AEGIS London to serve as Head of HR.

Marsh has announced the appointment of Garrett Hanrahan as Global Head of Aviation for Marsh JLT Specialty, effective April 15. Hanrahan will succeed Simon Harker, who is retiring after 44 years in the industry. Hanrahan will be based in Houston.

 

 

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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IDEX Consulting are proud to have teamed up with the Insurance Times to bring you the latest news on salary movements and job prospects across the UK General Insurance sector.

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