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General Insurance Newsletter Friday 28th September 2018

28 Sep 2018

Insurance News

Breaking news this week: The Ardonagh Group (Towergate and Autonet owner) has agreed to buy Swinton Group from Covéa Group for £165m. This will add £168m of turnover, over one million customers and 1.6 million live policies as well as 1,550 employees to the group. Ardonagh stated it would fund the purchase from existing finance and with “cash from monetising certain Swinton assets” and that it is keeping the Swinton brand. Ardonagh CEO David Ross stated “We absolutely believe that the Swinton name is the missing piece in our offering between the extraordinary array of products we offer to customers” and has also confirmed that Ardonagh Deputy Chief Executive Officer Janice Deakin is to be in charge of Ardonagh’s personal lines business. He said the Swinton deal took a year to complete and that Autonet MD Ian Donaldson has been involved in negotiations, which he described as “massively complex”. He noted that it was now time for Ardonagh to focus on integration and ruled out making any more big buys in the retail space. “If opportunities come up in some of the other segments that aren’t distracted by what Janice will be doing, we will of course be alive to the opportunities, but don’t expect to see us grabbing lots of headlines next year,” he said. Meanwhile Covéa Group has confirmed that it will now focus its UK activities on underwriting. Gilles Normand, CEO of Swinton Group said: “Swinton has achieved a new milestone in its journey.... Joining forces with Ardonagh will help Swinton achieve its long-term goal of becoming the UK’s leading digital insurance Broker and I am pleased to see the business handed over to the new shareholder.”

Steve Kuncewicz, Partner at Law Firm BLM has updated delegates at Insurance Age’s 2018 UK Broker Summit on the lessons learned in the first 100 days under the General Data Protection Regulation (GDPR) regime and the efforts that need to be taken to ensure ongoing compliance. GDPR and the new rules on how organisations hold and manage personal data on individuals came into force on 25 May. Kuncewicz told the audience that the date was never meant to be a “cliff edge” and that now was the time to “stand back and make some sane decisions about how you are going to deal with it”.

Bikspoke has launched its bicycle insurance scheme on the SchemeServe platform. The software provider said the scheme, which is available wholesale or retail, offers bespoke cover options for all type of bicycle activity including road, mountain, competition and electric bikes. According to SchemeServe it also provides legal support and claims management services for policyholders.

InsureTrek18 has raised a staggering £97,000 so far for dementia research and the Alzheimer’s Society. Led by Simon Cooter, Commercial Lines and High Net Worth Director at Covéa Insurance, the group of 25 UK Insurance Executives successfully completed a three-day trek of the Mont Blanc massif to raise funds for dementia research.

Aviva, Index Initiative and the United Nations Foundation have announced the launch of the World Benchmarking Alliance (WBA), with the aim of helping businesses do more to achieve the Sustainable Development Goals (SDGs). The WBA, launched in New York on the eve of the General Debate of the 73rd session of the United Nations General Assembly, will develop free, publicly available benchmarks which rank companies on their contributions to achieving the SDGs. 

Premium Credit responds to cyber incident: "on Sunday 16th September 2018, our virus monitoring alerted us to a cyber incident. We followed our extensive security protocols designed to protect our systems and isolate our Partners from harm, we then began the investigation into the incident with 3rd party experts. Our forensic investigation into the incident is ongoing and we have found no evidence of data loss. Most systems are now working and Brokers are able to trade, with very few exceptions. We continue to work around the clock to restore all services for our Brokers and this will continue until all systems are back online."

Global Research shows Insurance Managers are warming to Diversity and Inclusion. 2,500 respondents from 150 firms across six continents surveyed on attitudes to diversity and inclusion 93% of respondents say that their Managers - traditionally the hardest group to reach and influence in the ‘middle’ of firms - are now taking positive action on diversity. More than three-quarters (82%) say that their views on the importance of diversity and inclusion have changed positively since the festival started in 2015.

The UK – which hosts the world’s largest commercial insurance market and is home to the largest number of banks – must contribute to the development of the global regulatory agenda. This is the case being made by the International Regulatory Strategy Group (IRSG), saying it is in the interests of the UK financial services industry, policymakers and regulators to ensure that global regulatory and standard-setting frameworks for the sector can evolve and deliver effective outcomes in the most efficient way over the coming years.

A new motor-focused MGA is set to hit in the UK market later this year, backed by Berkshire Hathaway International Insurance. Hedgehog Insurance, founded by CEO Pete Storey and business Partner Ben Gower, who co-own travel Insurer MGA 1Cover, will target drivers who face higher than average premiums. The new MGA will be based in Gibraltar with its UK underwriting and claims handled by Cardiff-based sister company Rostella, run by director Nigel Lombard, who has 25 years’ experience in car insurance, e-commerce and operations.

With approximately 120,000 EU migrants working in the UK construction industry, talk of restricting lower-skilled EU workers is understandably leaving the sector on edge and Construction Insure’s Mark Herbert has offered his advice. Herbert said Brexit could have a huge impact on foreign workers working for construction businesses in the UK and outlined the potentially massive insurance implications. Now, reacting to a recent report by the Migration Advisory Committee (MAC), the construction insurance expert is telling firms to play on the safe side.

In order to meet the targets of its business plan for next year, Zurich Insurance is mulling cutting another US$600 million in costs. For the period between 2017 and 2019, the Insurer had planned to accumulate total cost savings of US$1.5 billion. As of August, Zurich said that it had reached US$900 million of the planned cost savings for end-2019.

The Information Commissioner’s Office (ICO) has shed light on why the British unit Equifax UK is being penalised for last year’s cyber incident across the pond. The massive data breach suffered by the credit reference agency – officially known in the US as Equifax Incand and Equifax Ltd in the UK – between May 13 and July 30 in 2017, while it involved the information systems in the US, compromised the personal information of around 15 million UK customers. This led to British authority ICO slapping Equifax Ltd with a £500,000 fine under section 55A of the Data Protection Act 1998.

Cheshire headquartered international financial services business, Alexander Beard Group (ABG), are delighted to announce the launch of Chilton Beard Limited, (CBL) a new Broker in the London insurance market, offering direct access to the Lloyd’s and London Markets. Based in the city of London and headed by Matthew Chilton, an experienced Lloyd’s Broker, the company will operate in the international area of expat cover for group corporate health, life and disability cover. With experience of dealing with high risk groups or individuals working in overseas locations and some of the most challenging parts of the world, it is able to provide a level of technical expertise that is only found within a specialist Broker. 

Research by Ecclesiastical has revealed that 27% of Brokers are still completely unaware of the Insurance Distribution Directive (IDD) despite needing to be fully compliant by 1st October 2018. The interviews with a pool of 200 Brokers found that only 31% feel fully prepared while 17% admitted they are not ready to comply. The majority, 52%, said they still need further training in key areas such as governance, product terms and conditions and assessing customer needs.

Online reverse auction marketplace for financial services Honcho has joined the British Insurance Brokers’ Association (Biba) as an Associate Member. The InsurTech start-up noted it had to go through a “robust approval process” in order to join the trade body. The business has previously stated that it is set to disrupt the car insurance sector, particularly price comparison websites, by allowing car Insurers to bid for business from consumers.

Dual Asset Underwriting has launched its Dual Asset I.D. Fraud Policy. Phillip Oldcorn, Chief Underwriting Officer of Dual, said: “The Dual Asset I.D. Fraud policy has been launched in response to troubling Law Society and Land Registry reports about the amount of I.D. fraud, that is hurting consumers, (as well as) losses of the type recently litigated in high profile fraud cases such as Dreamvar and P&P.  “Property fraud is on the rise and fraudsters are constantly finding new ways to exploit the housing market.” He continued: “If you are unlucky enough to be targeted, consumers are best served with a combination of high quality legal services and transnational ‘no-fault’ insurance, that can pick up the pieces, immediately, when things inevitably go wrong." 

The AA has posted a drop in trading Ebitda for its insurance division to £29m for the start of 2018. The 15% decline for the six months to the end of July (H1 2017: £34m) came as revenue was flat at £69m. The total number in force Motor and Home policies was similarly stable, creeping up from 1.46m in the same period of 2017 to 1.48m this year.

Aston Lark has bought Dover-based Pharos Insurance Brokers for an undisclosed sum. It is the third deal of 2018 for Aston Lark and the second since the merger of Aston Scott and Lark completed over the summer. The business bought Maidstone-Broker Michael James Insurance and property services in July and Ingram Hawkins and Nock in Stourbridge this March.

Gresham Underwriting has launched its new Unoccupied Property product on its online system. It covers full perils including accidental damage and subsidence, enhanced security discounts, increased excess discounts and non-standard proposals such as claims and insolvencies. Insurance for Grade II listed buildings is also available. According to the managing general agent (MGA), the policy is available on its updated quote engine, which it said provides Brokers with a quote in minutes.


Market Movers and Shakers

Alesco Risk Management Services, the specialist insurance and risk management Broker announces the appointment of Steve Dewey as Executive Partner in its Energy division. Steve will join the business early next year and focus on upstream business, primarily in the US, reporting to Simon Clarkson, Managing Partner, Energy. His appointment will further enhance the team’s capabilities by providing a strong technical resource with a wealth of experience in Account Executive roles and production support, both in the US and worldwide.

Pioneer Underwriters is pleased to announce the appointment of Andrew McMellin as Chief Executive Officer, effective 8th October 2018 and pending regulatory approval. Dane Douetil, CEO of Pioneer’s parent company, Minova Insurance Holdings Ltd and currently CEO at Pioneer, will become Chairman of the business. Max Taylor, who has been Chairman of Pioneer since 2013, will retire following a transition period, during which he will retain a consultative role. 

Markel International, the specialist Insurer, has appointed Peter Dickel as Senior Underwriter in its PACE (Personal Accident, Contingency, Entertainment) team. He will join Markel on November 1 2018. Peter will report to Managing Director James Leach and work with the existing PA team of Johan Haggo and Joanne Barry. Peter has over 20 years’ experience in Accident and Health lines, most recently as class Underwriter for MS Amlin, following similar appointments at W R Berkley and Torus. 

Marsh, a global leader in insurance broking and innovative risk management solutions, announced the appointment of Tom Colraine as a Non-Executive independent member of the board of Directors of Marsh Ltd. During his career, Mr. Colraine has held many senior roles in the insurance sector including Chief Operating Officer (COO)/Chief Financial Officer (CFO) of AIG Europe from 2009 – 2014, which followed his time as Non-Executive Director and Chairman of the Audit Committee between 2007 and 2009. Prior to AIG Europe, Mr. Colraine worked for Willis Group Holdings Inc. for nearly 20 years, from 1988-2007, where he held several senior leadership positions including CFO, Vice Chairman and Co-COO. 

Tamesis DUAL, part of the underwriting arm of the Hyperion Insurance Group, is pleased to announce the appointment of Ben Love as Director of underwriting. Love will be based in London and report to Tony Lovett, Managing Director and Founder, Tamesis.

Axa XL today announced that Paul Greensmith has been appointed CEO of Catlin Underwriting Agencies and XL Catlin Insurance Company UK, subject to regulatory approvals. He replaces Paul Jardine who, as previously announced, will be leaving XL Catlin later this year. The move follows the acquisition of XL Catlin by Axa.

Zurich Insurance has appointed Helen Pickford as Chief Financial Officer in the UK. With a strong background in the UK insurance industry, Helen was previously Deputy CFO for Zurich UK and CFO for Zurich’s UK Life business. Prior to joining Zurich in 2016, Helen was Finance Director at Ageas and held senior finance roles at Royal Sun Alliance (RSA) and has over twenty-five years’ experience in the insurance industry.  

Specialist Engineering and Construction Insurer HSB Engineering Insurance (HSB), part of Munich Re, has appointed John Nicholls and Jamie Talbot to new roles within the business. John Nicholls has been appointed as Construction Product Lead within the Underwriting Strategy and Standards team and Jamie Talbot has been appointed as Regional Underwriting Manager for Central and South.

The British Insurance Broker’s Association (BIBA) has made two key appointments to further strengthen the operational benefits it offers to members. Martin Bridges, who joined BIBA in July 2014 as Technical Services Manager, has taken up the new position of Corporate Affairs Manager from 18th September 2018. In his new role Martin will be the go-to person on BIBA Manifesto issues that will help Brokers in their day-to-day business. He will also build and manage BIBA responses to consultations relevant to Brokers, using member feedback, considered argument and necessary evidence. Also filling the vacated role of Technical Services Manager is Shaune Worrall who joined BIBA on 18 September 2018. Shaune, was formerly chair of BIBA’s property committee and has a rich background in affinity and schemes development. 

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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