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General Insurance Newsletter Friday 2nd October 2020

02 Oct 2020

The Devlin Hotel, which is suing Arachas Corporate Brokers Ltd and RSA Insurance Ireland DAC over the latter’s denial of the hotel’s Business Interruption insurance claim, has been allowed to expedite the case. A report said the legal action has been admitted to Ireland’s fast-track commercial court. It was noted that both the Broker and Insurer consented to the now-granted application to speed up the proceedings.

“First of its kind” – that’s how Lloyd’s of London describes Parametrix Insurance, the newly launched Business Interruption product that is said to be the pioneer off-the-shelf parametric IT downtime policy tailored towards small- and medium-sized enterprises. Led by Tokio Marine Kiln (TMK) and supported by other members of the product innovation facility at Lloyd’s, Israel-born Parametrix Insurance uses a parametric trigger and will automatically pay out if a policyholder’s critical IT services are disrupted.

In further news...as part of Lloyd’s of London’s work to drive cultural transformation across the market, it has now set a diversity policy for the Council of Lloyd’s, which is the Lloyd’s governing body with responsibility for the market’s overall management. The move comes following the July release of market-wide gender targets, as well as the previously announced commitment to setting a similar ethnicity goal. For the council, it has been agreed that a minimum of 33% of the body should be female and/or from a non-white background by the end of 2023.

Specialty insurance and reinsurance underwriting platform K2 International has set its sights on further expansion with the opening of an office in Brussels and the establishment of European operations. According to the firm, the operations will boost its international business and will focus on responding to any absence of EU passporting rights when the Brexit transition concludes. It is hoped that in time the benefits of the office will be rolled out across the firm and there will be distribution benefits for Brokers across the region.

Arthur J. Gallagher & Co., one of the largest insurance Brokers in the world, has revealed that it was hit by a ransomware attack over the weekend. According to the brokerage, it first detected the ransomware attack on September 26, 2020.

Non-standard GI Broker Ceta Insurance has decided to slash its rates. The company is knocking up to 30% off a range of non-standard risks in a move that it states reflects its ability to negotiate preferential terms for Brokers through its platform.

American Financial Group (AFG) has entered into a definitive agreement to sell GAI Holding Bermuda and its subsidiaries – which comprise the legal entities that own Lloyd’s of London Insurer Neon Underwriting – to private markets asset management firm RiverStone Holdings Limited. AFG previously announced its plans to exit the Lloyd’s marketplace through the sale of Neon earlier this year.

The Ardonagh Group has released its report to investors for the six months ended June 30, and the 66-page document shows the insurance brokerage has slipped further into the red. In the first half, Ardonagh’s loss amounted to £94.1 million – more than double the corresponding loss in the same period last year, which stood at £41.8 million. The latter figure was restated from the previously reported H1 2019 loss of £44.5 million.

Willis Towers Watson has announced that overall placements in the international market through its Global Markets Hub have increased by 67% year over year to reach US$525 million (around £407 million) in premium, despite the challenges created by the events of this year.

Aviva is mulling a possible piecemeal sale of its Italian insurance business, sources close to the matter said. The company’s Italian business is comprised of two joint venture agreements centered on life insurance and general insurance. One distribution agreement is with UniCredit – which expired this year. The other bancassurance partnership was with Italian financing company UBI Banca.

Zego’s Fleet products will be accessible by members of Broker Network and Compass following a deal between the insurtech and network-parent Bravo Group. Zego, founded in 2016, provides a wide range of flexible B2B insurance products for Fleet businesses and new mobility services, such as private hire, courier and micromobility businesses. The deal means more than 700 network members will be able to use the Zego proposition.

There is a new Broker on the scene, after Coverys European Holdings (CEH) confirmed the launch of Celeritas. A European Broker with a focus on binder business and open market placement, it is the broking business of the AEC Wholesale Group, the MGA that CEH picked up back in January. However, it is set to operate independently of the AEC brand with binders and risks sourced working with syndicates across Lloyd’s and the wider markets.

 

The Financial Conduct Authority (FCA) and seven of the Insurers involved in the Business Interruption test case have filed leapfrog applications to appeal aspects of the judgment in the Supreme Court. According to the regulator, the deadline for parties to file these applications was yesterday (28 September). A leapfrog application means that the appeal will go directly to the Supreme Court, skipping the Court of Appeal.

In other news... “Our objective throughout this case has been to achieve clarity for everyone involved as quickly as possible, and that remains the case.” That was the assertion made by the Financial Conduct Authority (FCA). The regulator had hoped to reach an agreement with the relevant Insurers on the interpretation of some important elements of the Business Interruption test case judgement. According to the FCA, the agreement would have allowed for faster compensation for eligible claimants.  

Hospitality Broker NDML and the Night Time Industries Association (NTIA) have called on Hiscox to pay out Business Interruption claims “without further delay”. In an open letter addressed to Hiscox Managing Director Ross Dingwall, the Broker and the trade body urged Hiscox to begin to make interim payments for 50% of each claim, with a further 25% to be paid on 1 December “for those (hopefully few) claims which have not yet settled by that date” 

SEIB Insurance Brokers (SEIB) has today announced its acquisition of Colchester-based WRS Insurance Brokers (WRS). Under the terms of the acquisition, WRS will continue to operate from its Colchester office under the management of its former Director, Chris Chapman, and all the staff of the business will be retained. WRS specialises in the social welfare sector and provides Business and Property insurance, with an emphasis on delivering cover from an ethical viewpoint. This socially responsible approach sees WRS provide tailor-made insurance cover for charities, churches and care and community groups.

Higher prices, less choice and worse services for motorcyclists across the UK – those were the fears that the Competition and Markets Authority (CMA) outlined in its Phase 1 investigation into the merger of Ardonagh Group Limited and Bennetts Motorcycling Services Limited in August. Now, the mega merger is to be reversed. The CMA has confirmed it has accepted a proposal from Ardonagh, the name behind both Swinton and Carole Nash, to unwind the £26 million deal to resolve its concerns. The two leading distributors of motorcycle insurance in the UK will now part company – with Ardonagh offering to sell Bennetts, in order to reverse the deal completely.

Insurance and roadside assistance provider AA Plc has released not only its financial results for the six months ended July 31 but also an update on its potential joint takeover by TowerBrook Capital Partners (U.K.) LLP and Warburg Pincus International LLC. It was also announced that the insurance and roadside assistance group posted a £26 million profit before tax in the first half. The amount represents a 38.1% decline from the corresponding figure in 2019. Operating profit, meanwhile, improved 0.8% to £121 million. Additionally, the period saw an 11.2% and 0.9% growth in Motor and Home policies, respectively.

European investor Hg is pouring money into Hyperion Insurance Group, the London-headquartered parent of Howden Broking Group, Managing General Agent DUAL, and data analytics and digital delivery business Hyperion X. In a release, Hg said its significant long-term equity investment in the international insurance group pegs the business at an enterprise value of approximately US$5 billion (around £3.9 billion). The investor joins Hyperion as a growth partner alongside General Atlantic and CDPQ, which invested in 2013 and 2018, respectively.

Independent insurance Broker Howden has ramped up its focus on the Professional Indemnity space with a key acquisition. The company has snapped up St Giles Legal & Professional Risks, a PI Broker specialising in the UK Solicitor sector. The move, which now brings the number of UK law firms that Howden represents to more than 1,000, was welcomed by UK regions Managing Director Mark Westgarth who noted that St Giles is “highly regarded” in the space.

Brokerbility Holdings Ltd has been snapped up by The Clear Group for an undisclosed sum. Described by Clear Chief Executive Howard Lickens as a “brilliant deal” for everyone, the acquisition – Clear’s 27th broker swoop – spans BHIB Insurance Brokers Ltd, Churchill Insurance Consultants Ltd, the Brokerbility Network, as well as technology businesses Brokertech and Brokerbility Information Gateway.

Ardonagh strikes deal for Lloyd Latchford, the deal has been structured with £11.5m in cash and the remainder in shares.

Specialist insurance Brokers BKG West, Cobra Insurance, Cooke & Mason, DE Ford, Franklands, Lorica, PIB Private Clients, PIB SME Insurance, QPI, Wilby, and WW Group are now all trading as PIB Insurance Brokers. “PIB Group has seen significant progress in a short space of time since its formation, alongside PIB Insurance Brokers as the original group company,” said Steve Redgwell, Chief Executive of the specialty division at PIB Group Limited – the entity which also spans PIB Risk Management and PIB Employee Benefits.

Rothesay Life, the largest specialist annuity provider in the UK, has announced that GIC and Massachusetts Mutual Life Insurance Company (MassMutual) have agreed to acquire Blackstone’s 36% stake in Rothesay Life. Under the terms of the transaction, which values Rothesay Life at £5.75 billion, MassMutual and GIC will each become equal 49% shareholders.

Verastar has acquired Littlenlarge, a commercial Property insurance Broker specialising in buy-to-let and investment Property portfolios. Verastar first started providing insurance to its customers with the acquisition of The Insurance Octopus in 2016, which offers a range of solutions for small businesses from Business Interruption insurance to Liability cover.

 

British citizen Ian Kelly, whose insurance career began at Prudential Plc, has been promoted from Investor Relations Head to Chief Financial Officer at global reinsurer SCOR. Effective on October 02, the appointment will see Kelly come onboard SCOR’s group executive committee. He will succeed group CFO Mark Kociancic, who the reinsurer said “has decided to pursue a new direction in his career” after 14 years with the firm.

Specialty Broker Ed has made a swoop for a new Casualty Treaty hire. Robert Sharp is its new Head of Casualty Treaty, Divisional Director, based in London. He will report to divisional CEO Heather Clarkson. Sharp has spent 13 years as a reinsurance Broker, and built up significant experience with a stint at Aon, most recently holding the role of Account Executive for its reinsurance solutions team.

There will soon be a new Non-Executive Chairman at Allianz Holdings. Paul Evans is set to join the board on November 01, later taking over from current Chair Rick Hudson when he retires in April. Evans is also set to Chair both Allianz Insurance plc and LV= General Insurance Group.

The turn of the week saw Avid Insurance Services Limited welcome a new face. The company has brought in Jon Terry to take the FD role. The move, according to CEO Stephen Gibson, reflects the firm’s efforts to grow both organically and inorganically.

It’s been less than a year since Stuart Heath took the role of Head of Delegated Property at Tokio Marine HCC and now he is bolstering the ranks with four new appointments. The division, which focuses on UK and European Specialty Property, will welcome Scott McEwen (Deputy Head of Delegated Property), James Harper (Senior Underwriter), Jamie Tamsett (Senior Claims Adjuster - Delegated Property) and Iain Farries (Senior Underwriter).

Pen Underwriting has announced several new roles to support its plans, including that of Technical Underwriting Director, to be taken by Stewart Gardiner. Gardiner, who reports to Pen Chief Underwriting Officer Jennifer Martin, was previously Underwriting Director for the risk managed commercial business.

Guy Carpenter & Company, a global risk and reinsurance specialist and a business of Marsh & McLennan Companies, has announced the appointment of Paul Miller to lead its Property catastrophe value proposition for the UK, Global Specialties and key global clients. Miller will step into the role effective September 2021.

Independent specialist reinsurance Broker BMS Group has announced the appointment of Suzi Morgan as Director, effective in early 2021. Morgan joins BMS North America Direct & Facultative to assist Mark Lawson in leading the team. She will be based in London.

There’s a new Captain at the helm for West P&I Club. Captain Simon Hodgkinson has taken the role of Head of the firm’s Loss Prevention department, making the switch from Polarcus where he was Head of Marine Operations. His background also includes time spent with the DNV GL Technical Committee Middle East over a six-year period, as well as being a member of the Honourable Company of Master Marines and Nautical Institute.

The Scandinavian branch of HDI Global Specialty SE has welcomed a new Managing Director. Taking the role is Thomas Barenthein, who is making the switch from Inter Hannover, where he was Managing Director for Sweden.

The Insurance Institute of London (IIL) has elected a new President for the 2020 to 2021 period. Anthony Baldwin, Chief Executive Officer and Board Director of AIG UK, has received the nod for the top post and will be the IIL’s new President effective from September 28.

Leading rural Insurer NFU Mutual have announced the retirement of its Group Chief Executive, Lindsay Sinclair, who will be stepping down at the end of March 2021, after over 12 years in the position. It has been revealed that he will be succeeded by NFU Mutual’s current Sales and Agency Director, Nick Turner, who will take over Sinclair’s position on the first day of April 2021, subject to regulatory approval.

Trade credit Insurer Euler Hermes Group, an Allianz SE company, has tapped Allianz France Chief Financial Officer Clarisse Kopff to succeed outgoing Chief Executive and management board Chair Wilfried Verstraete. In a release, it was noted that Verstraete has decided to step down from his operational duties at the end of 2020 after successfully holding the top post at Euler Hermes for 12 years. He isn’t leaving the credit Insurer, though, and will serve as an Advisor to Kopff, whose appointment takes effect in the New Year. 

There has been a surge in recent developments at Specialist Risk Group (SRG). On the back of the acquisitions of Insolvency Risk Services, David Codling and Associates and Square Mile Broking, the firm has now swooped for a key name – picking up Chris Lennon from Gallagher. Lennon joins as Sales and Development Director for Specialist Risk Insurance Solutions (SRIS), bringing with him two decades of experience across commercial and corporate broking, including time spent with Lockton and HSBC. At Gallagher he was Head of Sales and Distribution for Niche UK business.

The rapid growth spree for MGA Pen Underwriting shows no signs of abating after the company added a host of names to its delegated solutions division. Among them, is Michael King, who will join as Head of Delegated Commercial from January next year. King will step into the hotseat previously occupied by Seb Simmonds, who is newly announced into the role of Managing Director of risk managed commercial. He is set to be well supported too, as Fred Florry has just completed his move to the firm in the role of Senior Underwriter. In addition, the MGA has made an internal promotion with Leo Downes succeeding Andrew Booth as Head of Delegated Household.

Insurance technology firm CDL has promoted Nigel Phillips to the Chief Executive Officer post, as its Co-Founder and Chairman Tom Hogg steps down. The change also sees Gary Johnson move from the CEO to Chairman role.

 

 

 

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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