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General Insurance Newsletter Friday 29th November 2019

29 Nov 2019

On Tuesday, November 12, it was reported that the Corbyn led political opposition had undergone a second cyberattack only a day after facing a “sophisticated and large-scale” attempt to disrupt its digital platforms. Head of Cyber risk consulting, UK & Ireland at Marsh, Jano Bermudes, outlined the details of a distributed denial of service (DDoS) attack which he said: “is the use of a group of internet-enabled computers that have been compromised by attackers and formed into what is called a botnet (a network of compromised computers or internet-enabled devices).”

The Insuring Women’s Futures (IWF) initiative led by the Chartered Insurance Institute (in collaboration with a wide range of leading professionals, organisations and experts) is more than a programme, it is also a pledge. The pledge has been taken up by Insurers, professional bodies, guidance services and Financial Advisors who have promised to take action to empower women to improve their financial futures. At the recent Manifesto Proposals launch event of this initiative, a number of proposals for how to enact real change to help women in the UK live a financially resilient life were detailed. Central to these recommendations was the need to lobby government for changes to auto-enrolment, pension freedoms and sharing rules to safeguard the financial future of female pensioners.

Terrorism reinsurer Pool Re has undergone a makeover, unveiling a new logo and website as part of its “refreshed” brand. “We’ve changed a lot since we were founded in 1993, grown as an organisation, developed our proposition and enhanced our expertise to now also include Pool Re Solutions, our new in-house risk division,” stated the UK-backed mutual.

Swiss Re, which held its 2019 Investors’ Day (November 25) at 11:00am GMT in London, has offered a sneak peek into the reinsurance giant’s strategy. In a release, the Zürich-headquartered group pointed to its reinsurance business’s “increasing earnings power”; its focus to bring the corporate solutions unit back to profitability; and how the life capital segment is creating economic value for Swiss Re.    

Nationwide Building Society is among the latest to release its interim financial results and Chief Executive Joe Garner isn’t surprised by the figures. “In line with our expectations, our profits were lower as we invested in meeting the needs of our members, in our service and in our future,” stated the CEO. “As we announced in September, profits were also affected by an additional PPI (payment protection insurance) charge.".

Allianz Insurance Plc, the British operations of Allianz Group, has a new ally in the form of Plastic Surgeon. It’s been announced that the Insurer has partnered with the specialist restoration company to bring about sustainability improvements through targeted repairs and reduced materials wastage. Benefits of the tie-up also include the ability to track repairs online via a bespoke reporting platform and a faster claims lifecycle.

“Our two companies are a good match in terms of our capabilities.” That was how the RAC’s insurance and financial services Managing Director Mark Godfrey described the newfound alliance between the Motor insurance Broker and insurtech Wrisk. The partners are now trialling a mileage-based Car insurance product designed to give customers the flexibility to choose the coverage they need.

Marsh’s #ReWRITE (women, risk, insurance, technology and empowerment) Hackathon, which was launched in the US earlier this year, has concluded its European leg. Bringing home the regional award is the team from Sweden made up of Linnea Söderlund, Viola Söderlund and Julia Ye. The regional grand final was held following local contests in cities such as Milan, Stockholm and Warsaw.

In further news...Marsh Commercial, which was rebranded from Jelf earlier this year, is set to create five regional centres to deal with certain customers. The locations earmarked are Bristol, Glasgow, Harrogate, Leeds and Worcester. Customers with premiums of below £2,500, will be funnelled through the branches which have been branded as Centres of Excellence by Marsh management. According to Marsh Commercial this isn’t a set figure but merely a guideline.

Rate movement in Directors and Officers (D&O) Liability hit 77.3% in Q3 2019, figures released by Marsh have revealed. This follows increases of 34.9% and 64.7% in Q1 and Q2 respectively. The measure tracks Marsh’s exposure to D&O rates when covering FTSE 100 clients. For private companies, the figure for Q3 stood at 42.9%.

RSA has confirmed that its ongoing UK-wide change programme will lead to a number of redundancies across the business. The provider stated in its trading update for Q3 2019 that it had begun restructuring its UK operations. It further revealed it had spent £8m on the cost reduction programme in Q3. Some people who work in Broker-facing roles in RSA’s Global Risk Solutions (GRS) and Commercial Risk Solutions (CRS) divisions are at risk of redundancy as part of the merger.

A new Managing General Agent headed up by former One Commercial boss, Mike Keating, has launched (25 November). Qlaims Insurance stated that its product will deliver Brokers and their clients a claims advocacy service for Commercial Property losses. The MGA will fund a professional claims preparation and negotiation service supported for valid Commercial Property claims of over £5,000.

The Financial Services Compensation Scheme (FSCS) declared 35 failed regulated firms in default between 1 August and 31 October 2019. The list included two insurance Brokers – Strathearn Insurance Services in London and Bellfield Financial Services, formerly Kirkintilloch Insurance Services, with a registered address in Glasgow. The FSCS explained that a declaration of default means it is satisfied that a firm cannot pay claims for compensation made against it.

Aviva is targeting a 20% cost reduction in its personal lines business, according to Colm Holmes, Chief Executive Officer of general insurance. “Our personal lines performance over the last 18 months has been less than we would have wanted it to be in terms of margin, not necessarily growth,” Holmes stated. He added that the provider is looking to simplify the business in this sector and cut the number of products from 400 to 40 by 2022. This is across all of its channels – strategic partners, Brokers, affinity and direct.

In further news...Aviva has launched an integrated package of insurance designed specifically to support large companies in the complex market of Renewable Energy, including onshore windfarms, solar power and battery storage. Aviva Renewable Energy covers all the insurance needs of renewable energy companies globally which have operations in their home and overseas markets. Insurance is a key requirement for lenders in the renewables market.

Ardonagh Group CEO David Ross has stated that the business was not surprised by the result of the recent court case, where the judge dismissed claims of staff poaching brought forward by Gallagher. “What was surprising to me was how surprising it was to everybody else,” Ross commented. He continued: “The law is the law. This was the legal advice we had all the way through and we were not surprised by the result.”

Reflections from AIG’s Corporate Governance & Cyber Seminar - Konrads Klints, Director, Cyber, KPMG: "What we mostly see are Cyber events that are directly from organised crime groups. And organised crime groups always are out there for one thing and one thing only - money. The thing we see as most common, in terms of Cyber events that are inflicted by somebody else, is business email compromise.".

T&D Holdings has partnered with a newly created fund by The Carlyle Group to acquire a 76.6% ownership interest in Fortitude Group Holdings for about US$1.8 billion (around £1.39 billion) from AIG. A release said that after the transaction closes sometime in mid-2020 (subject to required regulatory approvals and other customary closing conditions), ownership interests in Fortitude Re will include Carlyle and its fund investors at 71.5%, T&D at 25% and AIG at 3.5%.

AXIS Capital Holdings Limited has unveiled its preliminary loss estimate for the Japanese Typhoon Hagibis, pegging the cost at around US$90 million to US$110 million. The estimate is net of the company’s estimated recoveries from reinsurance and retrocessional covers, including the impact of estimated reinstatement premiums.

Managing General Agent C-Quence and API platform Cytora have come together for commercial Property & Casualty (P&C) underwriting. C-Quence has stated that it will launch its P&C suite in January using Cytora’s Property API to connect data on Property and location, as well as other data, to each Property & Casualty submission.

Specialist Risk Group (SRG) has purchased David Codling and Associates for an undisclosed sum. David Codling founded the Jewellers’ Block specialist Broker in 2003 and has worked in the insurance industry since in the 1970s.

Specialist insurance provider, CFC has put forward a new tool, a Cyber risk heat map to help Brokers sell Cyber insurance. According to the firm the map is a colour-coded graph which ranks the severity of different industries’ exposures to Business Interruption, privacy and Cyber crime and includes a few examples of how these exposures can play out for different types of organisations.

A ghost Broker was recently sentenced for selling fraudulent Motor Trade insurance policies to an organised criminal group, which in turn is believed to have helped the gang carry out drug crimes on UK roads without being stopped by police for no insurance. Tan Lam Le recently appeared at Preston Town Court where he received a 14-month suspected sentence and 200 hours’ community service after pleading guilty to two counts of fraud by false representation.

Markerstudy Insurance Services (MIS) will meet its first loan repayment deadline on 1 December. A spokesperson for parent company Markerstudy Group said: “We will repay on time”. MIS currently owes £217.3m, plus interest, to Qatar Re after the backer chose not to reinvest in the business. The total figure is expected to exceed £240m once interest is accounted for.

H.W Kaufman has bought Barbican Protect, subject to regulatory approval. The move will see Barbican Protect, which was previously part of Barbican Insurance Group, rebrand as Burns & Wilcox. Barbican Protect specialises in commercial Property, Casualty, Financial Lines and Marine, focusing on regional retail Brokers across the UK. H.W Kaufman is seeking to grow GWP at Barbican Protect following its acquisition of the MGA for an undisclosed sum. The US-based family business is also keen to grow its UK footprint and this may lead to further deals in the UK MGA space, according to James Stevenson, managing director at H.W Kaufman Group.

Arthur J Gallagher has signed heads of terms with Capsicum Reinsurance Brokers to increase its stake in the firm from 20% to 100%. Gallagher confirmed in a statement: “The parties will now continue their exclusive negotiations. Any deal remains subject to the receipt of necessary approvals and the execution of relevant agreements and the parties will not be commenting further at this stage.”.

MS Amlin has revealed a new operating model and senior leadership team as part of the reorganisation of its international businesses. The move follows its decision to exit nine business classes, announced in September, as part of a fresh underwriting strategy which will be implemented by 2023. According to the Insurer, the reorganisation has been designed to support the new strategy, which involves redeploying capital and management to focus on its three core markets of reinsurance, speciality and domestic specialty.

Stress is still the most commonly experienced mental health issue at work, according to Ecclesiastical’s latest Broker Wellbeing Survey. Stress is affecting three in five Brokers out of the 200 surveyed by the specialist Insurer. This is a slight improvement from last year, when the research showed that 78% of respondents felt stressed at work, with a third of these experiencing stress at least once a week. This year’s findings also revealed that 37% of Brokers experience anxiety at work, while 34% reported that they feel overwhelmed.

Smaller businesses in the UK are increasingly a target for Cyber crime and are just as exposed to the rules of GDPR as their larger counterparts. CyberInsurerUK has teamed up with QBE, the business insurance specialist, to provide a dedicated Cyber insurance product for small and micro businesses that is is affordable, quick and easy to understand. There are common misconceptions about the exposure a small business can have to Cyber-attacks, with many small business owners believing that only those that accept payment for goods or services online are at risk. Small companies of all types however are increasingly falling victim to Cyber criminals; one company which had an attack that resulted in hundreds of phishing emails being sent from a hacked mailbox to their clients had to spend £32,500 on legal and IT forensic fees to ensure the hacker was out of their system. Furthermore, they were obliged to notify the Data Protection Regulator of the event.

AXA XL has announced that it has completed the acquisition of Secure Legal Title Limited, a London-based insurance agency and Lloyd’s-approved coverholder. Founded in 2012, Secure Legal Title has major operations in the UK, Europe, India and the Americas. Secure Legal Title provides insurance for legal risks in property transactions and mortgage finance. Its products include Title Insurance, Legal Indemnities and Title-to-shares insurance for real estate M&A transactions. AXA XL has also announced that it has agreed to acquire Armour Secure Insurance (ASI), a Mexican title insurance company affiliated with Secure Legal Title.

In further news...French global Insurer AXA has become the latest to announce that it is cutting ties with coal. AXA has told European coal companies that they should publish plans to phase out coal in accordance with the UN Paris climate agreement by 2021. AXA has also announced that it will totally phase out its insurance and investment exposure to coal in European Union countries and member countries of the Organisation for Economic Cooperation and Development (OECD) by 2030. It will phase out insurance and investment in coal everywhere else by 2040.

Landlord insurance provider RentSafeUK is now part of online estate agent 99home. Without disclosing financial terms of the transaction, 99home said it has acquired not only RentSafeUK but also tenant referencing company LandlordReferencing.co.uk. The two were both founded by Paul Routledge, who has more than 100 properties and was once stabbed in the head by an unvetted tenant.

Lloyd’s market planned premium growth for 2020 will be a few points higher than the market-average risk-adjusted rate increase of 5 percent.  Sources who attended a market presentation led by Lloyd’s Performance Management Director Jon Hancock and CFO Burkhard Keese told this publication that all classes of business, with the exception of accident and health and personal accident, are expected to have rate rises in 2020.

Carriers writing primary lead layers on Property direct and facultative (D&F) policies exposed to the Chilean riots may face substantial net losses due to the ambiguity of per-occurrence wordings. The Property market is expected to absorb the lion’s share of estimated losses of $2bn to $3bn as Insurers included strikes, riots and civil commotion cover in their policies during the height of the soft market. 

Cooper Gay France (CGF) has announced it is to buy Belgium-headquartered service company Tokio Marine Kiln Europe (TMKE). TMKE writes Credit and Surety, Cyber, Space and Accident and Health. It will become part of CGF’s MGA business, which writes P&C, Sports, reinsurance and Marine business. 



Investment banking company Morgan Stanley has appointed a former AIG Executive, Ruchika Sethi, to the role of Global Support Centre Head. As Global Head of the Banking company’s in-house support centres, Sethi will oversee the facilities and their specific tasks. Some centres fulfill back office and business functions related to technology, legal compliance and operations, among others, while other locations house call centres.

Aspen Insurance UK Limited (AIUK) has a new Chair in the form of Theresa Froehlich. The announcement was made by parent firm Aspen Insurance Holdings Limited, which said Froehlich will also serve as a Non-Executive Director (NED) not only of AIUK but of Aspen Managing Agency Limited (AMAL) as well.

Marsh has revealed that John Drzik, President of Global Risk and Digital, will step back from full-time responsibilities as leader of the division. A release said that Drzik will transition into a senior advisory role with the company, effective January 01, 2020. In his new role, Drzik will work with Marsh President and CEO John Doyle, as well as the Marsh executive committee, on strategic risk and digital issues. He will also remain Chairman of Marsh & McLennan Insights.

There’s a new top post at The Ardonagh Group and it will be taken on by Aviva and Marsh alumnus Graeme MacMillan in 2020. The independent insurance Broker has tapped MacMillan to become its first Chief Executive of Product and Distribution Management within Ardonagh Portfolio Solutions (APS). The freshly created position will involve overseeing various functions across Broker and carrier engagement and product design on behalf of the group’s £3 billion premium portfolio.

It was in September when specialist Insurer Ecclesiastical announced the 2020 retirement of UK general insurance (UKGI) Managing Director John Blundell; now it’s been revealed who is succeeding him come February. Richard Coleman, whose career began at Eagle Star before he spent 18 years at Zurich, is currently European Director and Global Head of Insurance & Assistance at Collinson. He is also an advisory board member at artificial intelligence insurtech Cytora.

Clare Bousfield, the Chief Executive of Prudential UK from 2016 to 2018, is joining the board of RSA Insurance Group Plc. The London-headquartered multinational Insurer has appointed Bousfield as a Non-Executive Director effective April 01 next year. She will become part of RSA’s group audit committee as well.

Integro Group has announced the departure of Andrew Behrends as Group CEO. Behrends will step down from the role on 31 December and will remain with the business as an Advisor to the board.

InsurTech, Iotatech, has appointed Mark Cliff to its Strategic Advisory Council (SAC). This move is effective January 2020 and will see him replace Dermot Joyce, who has left the board, but will remain as a shareholder in the firm.

Pikl, the sharing economy insurance specialist, has chosen Angela Seymour-Jackson to join its board as Deputy Chair. The new hire has previously held senior positions at Aegon, RAC and Aviva. She is currently a Non-Executive Director with Trustpilot, Rentokil Initial, Janus Henderson and Page Group.

Specialist insurance provider, CFC Underwriting, has appointed Angus Marshall as its Transaction Liability Practice Leader. According to LinkedIn he took up the position last month. Marshall joined the team from AIG where he led the UK and London Market M&A team for over four years.

GoCo Group, owner of GoCompare, has appointed Seb Chakraborty as Group Chief Technology Officer. Chakraborty will be at the centre of innovation and will be responsible for the group’s technology strategy in line with its long-term growth plans.

Anthony Baker, Partner at Plexus Law, has been elected as the new President of the Forum of Insurance Lawyers (FOIL) and will be responsible for driving the organisation around key issues for the insurance industry in 2020, including the whiplash reform, diversity and inclusion and technological evolution. Baker replaces James Heath, Partner at Keoghs, who has during 2019 steered FOIL on issues including the Civil Liability Bill, whiplash reform and LASPO Part 2.

As part of a restructure Rossborough has added to its local commercial team and chosen a new MD for its Guernsey branch. Richard Clarke, MD of Rossborough Healthcare across the Channel Islands and Isle of Man, has now also taken on responsibility for insurance broking in Guernsey and is supported by James Moores, Head of Commercial and Vanessa Lee, Account Executive.

AXA UK has announced two external appointments into key roles within its Delegated Authorities team as it continues to grow its Delegated Authority business. Gary Head has been appointed as Director of Delegated Authorities, having previously spent 23 years at Hiscox. In his team, he will have Joel Markham, who has been named as Head of Sales and Marketing for Delegated Authorities.

Fidelis Insurance has added Senior Underwriter Kayley Stewart to the Fidelis Underwriting Limited (FUL) London underwriting team to further develop the Terrorism and Political Violence account.

Markel Corporation has expanded the role of Mia Finsness, appointing her to the role of Managing Director, Global Casualty Underwriting and Claims. Finsness will work closely with Markel Executive Vice-President and Chief Underwriting Officer Robin Russo in her new role, as well as with the rest of the underwriting leadership team.

JM Glendinning Insurance Brokers has appointed Matthew Stuttard as MD of its north west business. Stuttard has been recruited from from Towergate where he was Sales Director. In his new role at JM Glendinning he will be based in Blackburn.

Industry veteran Philip Turner will join the Marine specialty team of Pioneer Underwriters to serve as a Specie Underwriter. Effective December 02, Turner will assume the London-based post – bringing decades of experience to the Managing General Agent. The former Marsh Managing Director led the Broker’s specie team from the ‘90s before moving to Canopius in 2015 as Head of Specie.     

Shipowner-controlled insurance provider Gard has appointed a Chief Underwriting Officer for London. The newly created post, effective March 2020, will see internal hire Magne Nilssen take responsibility for all business routed through the company’s London branch. At the same time he will continue to lead the offshore energy and Marine builders risk segment.

Artur Niemczewski has stepped down as CEO of (re)insurance services provider Pro Global. Finance director Andrew Donnelly has taken up the position on an interim basis. 

 

 

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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