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General Insurance Newsletter Friday 6th March 2020

06 Mar 2020

Sutton Winson has bought Kent-based Flexible Health Insurance Brokers for an undisclosed sum. Flexible Health, an independent health and protection Broker, was established in 2006 in Edenbridge. Sutton Winson noted that the acquisition comes as it looks to expand its Private Medical insurance offering into personal lines.

Ardonagh Group has bought the trade and assets from Rural Insurance Group for an undisclosed sum. The rural and agriculture specialist, which was previously owned by Primary Group, will join Ardonagh’s suite of managing general agent brands including Geo Underwriting, AIUA and BIBU. Ardonagh explained that contracts have been exchanged and completed by Geo Underwriting Services in relation to the purchase.

Hiscox has revealed a fall in profit before tax to $53.1m (£41.6m) for the full year 2019, compared to $135.6m in 2018. The business also reported a worsened combined operating ratio of 105.7% in 2019, up from 94.9% in the preceding year. However, the group saw a rise in gross written premium over 2019 to $4.03bn (2018: $3.78bn).

UK and German surveys reveal insurance policyholder dissatisfaction with the market’s handling of a new insurance environment. Separate surveys of the insurance environment for corporate policyholders in the UK and Germany have demonstrated a fundamental shift in pricing and the scope and availability of cover and revealed widespread dissatisfaction with the handling of the changing conditions by Insurers and insurance Brokers. The surveys were conducted by the UK risk and insurance management association, Airmic and the German risk and insurance management association, GVNW, in January and February 2020.

ERS, the specialist Motor Insurer, has announced a record profit of £13.9m since it was bought by Aquiline in 2013. The result was supported by a 13% year-on-year increase in vehicles on cover and GWP of £360m (£330m in 2018). The result demonstrates ERS’ ability to underwrite specialist Motor insurance through insurance Brokers, who continue to choose ERS as their preferred market. Whilst ERS’ top-line has grown, this has been achieved alongside a profit-first strategy. The Combined Operating Ratio (COR%) which ended the year at 99.7% (96.1% in 2018) reflects the June 2019 change in the Ogden discount rate to -0.25%.

International General Insurance (IGI) has helped the not-for-profit organisation Equal Playing Field (EPF) break a Guinness World Record for the most players to appear in a five-a-side football match, with 822 players from 65 countries taking part in its Festival of Football for 69 hours of continuous play. There are many parallels between gender inequality in insurance and sports like football. In both disciplines gender inequality exists - men out-number, out-represent and out-earn the women.

SSP is delighted to introduce SSP Intuition. Powered by Amazon Web Services, the new data lake solution will allow Insurers to build their own unique data insights into their performance. SSP Intuition provides daily access to over one billion intermediated quotes and quote responses across private Motor, Commercial Vehicle, Motorbike and Household. Fundamentally this will give the Insurer the ability to analyse and most importantly understand their own performance in the market, at quote, Broker and scheme level.

Ethos Broking has developed a foothold in the Midlands with the acquisition of Compass Network member, Perry Appleton for an undisclosed sum. Established in 2000 the Rugby-based business which is led by Managing Director Simon Leech, employs 14 members of staff and controls over £7m in GWP from its single office.

Admiral Group revealed that its profits exceeded £500m for the first time in financial results published for 2019. Profit before tax jumped £47m (9.8%) from £479m in 2018 to £526m in 2019, while turnover grew from £3.28bn to £3.46bn. The growth in profits was nearly entirely driven by the group’s UK insurance arm, where profit before tax increased £41m (7.4%) from £556m in 2018 to £597m in 2019.

Aviva has reported a 35% fall in operating profit in its UK general insurance business to £250m in 2019 from £383m in 2018. Its UK combined operating ratio also deteriorated to 97.9% in 2019, compared to 94.6% in the preceding year. However, net written premiums (NWP) rose by 1% to £4.22bn, up from £4.19bn in 2018.

Santander and Aviva have agreed to continue their partnership to provide Home and Life Insurance to UK-based customers. The new deal will allow the two companies to work together in delivering new products and services and reflects the success of Aviva and Santander’s existing partnership, first announced in 2011. The agreements follow a scheduled tender process and cover the distribution of Home insurance, mortgage life protection, family and lifestyle protection and over 50s life insurance, which will be sold by Santander through its UK branch network, online and over the telephone.

Sagar Insurance has acquired Anderson Ashcroft Insurance Brokers, a Preston-based commercial insurance Broker. It is the second deal for Sagars since it became part of Global Risk Partners in 2018. The Broker bought Thomas Cook in 2019. Anderson Ashcroft’s GWP was not disclosed.

Eldon Insurance, which was rebranded as Somerset Bridge last year, is to further appeal a £60,000 fine from the Information Commissioner’s Office (ICO). The Broker, owned by Brexit campaigner Arron Banks, was fined, alongside the Leave.EU campaign, which was also fined £60,000, for serious breaches of e-marketing laws in February last year.

The British Insurance Brokers Association (Biba) has pledged to support its members amid the increasing spread of Covid-19, a coronavirus, in the UK following a statement from the Financial Conduct Authority. A spokesperson said that it was monitoring government advice and intends to make members aware of the FCA warning. The statement, which was published on the watchdog’s website, said: “We expect all firms to have contingency plans in place to deal with major events. Alongside the Bank [of England] we are actively reviewing the contingency plans of a wide range of firms.".

In further news...the British Insurance Brokers Association (Biba) is moving forward with its Manchester conference in May despite fears that the Covid-19 outbreak may cause large gatherings to be called off. Registration for the Biba event, which takes place on the 13 and 14 of May, is now open. The organisation said that the event was still set to take place. The theme for 2020 is ‘The Year to Pioneer’.

In addition, BibaAssociation of British Insurers (ABI) and Chartered Insurance Institute (CII) have all issued fresh calls for the government to reconsider its approach to insurance premium tax (IPT). The ABI and CII have both called on the government to cut the tax, while Biba is seeking a freeze for the duration of the current Parliament.

The Chartered Insurance Institute (CII) has launched a Chartered title for managing general agents. The CII said the ‘Chartered Insurance Underwriting Agent’ title recognises the growing market presence of managing general agents. To hold the new title, individuals must hold the advanced diploma in insurance, be a member of the CII and have at least five years’ sector experience. It is also available to businesses.

Be Wiser has published reduced losses in its full year results for 2019. The broking group made a loss of £669,000 in 2019, an improvement from the £2.19m loss recorded in 2018. This is despite turnover falling from £26.1m to £21.8m over the same period. Mark Bower-Dyke, Chairman at Be Wiser, said: “We reduced staff numbers, we looked at our marketing budget and basically looked at the structure of the business as a whole.".

Insurtech start-up Coverly has confirmed that it will not be impacted by a restructure in its parent company, Bibby Financial Services (BFS). BusinessLive reported on 20 January that BFS was set to close its Liverpool office and make a number of redundancies. Coverly was launched in 2019 by Managing Director Jodi Cartwright, who has previously held a variety of executive roles in the insurance industry, including positions at Aviva and Brokerbility.

The Financial Services Compensation Scheme (FSCS) declared four insurance firms in default between 1 November 2019 and 31 January 2020. The firms were JB Wilcock Insurance in Nelson, Benson McGarvey Murdoch in Nottingham, Elite Insurance Company in Grantham and Quick-Sure Insurance in Gibraltar. Elite entered administration in December 2019 and Quick-Sure followed in January 2020.

Mactavish has called for urgent and radical reform of the UK commercial insurance sector. The company said it believes a long-term focus on price over value of cover has led to “considerable erosion of insurance contract quality, growing opacity around Broker fee structures and an increasing one-size-fits-all approach to complex risks”. The insurance consultancy has launched a year-long investigation and discussion programme, which it said aimed to encourage debate from across the UK commercial insurance industry around how to address these issues and transform the sector over the next ten years.

Saffron Insurance has purchased Romford-based independent Broker and Broker Network member C&M Insurance for an undisclosed sum. The deal is Saffron’s seventh since Ethos Broking took a majority stake in the Broker in 2018. C&M was established in 1996 and is owned and run by Sunil Shah. It has seven employees and Saffron stated that all staff will remain with the business.

Recent flooding has served as a reminder that contents insurance for tenants is a protection gap that the industry needs to tackle, according to Aon UK Chief Executive Officer, Julie Page. Page continued: “Not only does it hurt most in that protection gap, but it’s also more likely to happen. “If we look at those lower income families, what we see is a much higher likelihood of fire and burglary. This protection gap is wholly solvable.”.

The parent company of aggregator Go Compare, GoCo Group, has reporting a fall in operating profit in its preliminary results for the full year ended 31 December 2019. Operating profit fell to £20.3m from £37.5m the previous year. Revenue was steady at £152.4m (2018: £152.6m).

Green Insurance Group, the South Eastern hub Broker for Global Risk Partners (GRP), has bought Manor Insurance Services for an undisclosed sum. Manor was founded in 1990 and is a retail Broker based in Hastings, East Sussex. According to Greens, the business offers SME and personal lines products including Home, Motor, Charity, Business and Travel.

To celebrate International Women’s Day, telematics insurance pioneer, drive like a girl (trading style of Insure The Box who hold over five billion miles of driving telematics data), has released new data that shows women trump their male counterparts behind the wheel in terms of safe driving. drive like a girl’s data shows age plays a significant role in the likelihood of speeding. The younger the age group, the higher the difference in speeding occurrences. And staggeringly, 17-year-old men speed 130% more than women of the same age. It is not until motorists hit their thirties that men begin to take their foot off the accelerator, with the difference compared to women drivers dropping to 32%.

In the past few months it’s been difficult to ignore conversations about climate change – with 'climate strike' being named word of the year and Greta Thunberg making headlines again by being named Time's Person of the Year awareness of our long-term impact on the environment has never been higher. Sustainability has always been a part of RSA's corporate responsibility strategy, but when they launched Confident Futures, their work to integrate responsible business practices into their everyday operations, they've renewed their commitment to building a truly sustainable business, aiming to reduce the direct environmental impact – from the way they manage their offices to how they travel.

Allianz Insurance is hosting employee events across the UK to celebrate the one year anniversary of its charity partnership with leading mental health charity, Mind. Since the partnership began in March 2019, employees have taken on a range of fundraising activities which have raised £400,000.

In his role as Director of insurance at KPMG, Matt Francis focuses on insurance regulation and his daily responsibilities involve advising clients on the complex subjects of capital, governance and regulatory reporting. Up until about four years ago, he said, he was very much involved with the implementation of Solvency II but shortly after this came into being, Brexit occurred and since then he has spent the last three and a half years working on Brexit projects. These projects include trying to help companies in the UK trying to set up subsidiaries overseas, he said, but also advising European firms accessing the UK market on how to maintain their structures and on what changes they need to instigate to ensure their compliance following Brexit. There were a good number of UK firms who knew the day after the referendum that it would cause challenges to their existing models, Francis commented and who have spent the last three and a half years preparing their structures to be Brexit ready.

Britain’s terrorism reinsurer Pool Re has completed placement of its retrocession programme worth £2.4 billion. Led by Munich Re, the programme involves more than 50 international reinsurers including Hannover Re which is providing a significant portion of the coverage. Of the total amount, £75 million comes from the first-ever terrorism catastrophe bond.

COVID-19 will be registered as a notifiable disease in the UK to help businesses in making insurance claims. “We want to ensure any steps taken to protect the public during the COVID-19 outbreak are proportionate and do not come at an unnecessary social or economic cost,” a BBC report cited the Department of Health and Social Care as stating.

 

FUW Insurance Services has appointed Guto Bebb as its new Managing Director, starting on 6 April. Bebb is the ex-MP for Aberconwy and was previously an Under Secretary of State for Wales and the Minister for Defence Procurement.

MS Amlin has announced the appointment of Stuart Wood as Head of Casualty. Wood is the final Senior Leader to be appointed within the Specialty business and will report to Mark Clements and Andrew Wright, Co-Chief Underwriting Officers of MS Amlin Underwriting Ltd (MS AUL).

AXA XL insurance has announced that it has appointed Chris Williams as Global Head of Equine, Livestock & Aquaculture, with immediate effect. In his new role, Mr. Williams will be responsible for developing AXA XL’s Equine, Livestock & Aquaculture book and devising and delivering underwriting strategy and product profitability. AXA XL Insurance has also announced that Peter O’Neill has been promoted to UK Head of Downstream and Power, effective immediately.

Admiral Group has confirmed that Co-Founder and Group Chief Executive Officer, David Stevens, has notified the Board of his intention to retire from his position in 12 months’ time. The Insurer explained that following a “thorough selection process”, Stevens will be replaced by Milena Mondini de Focatiis, who is currently Head of UK and European Insurance.

Iprism has appointed Paul Constable as Commercial Underwriter. Constable joins from Victor UK where he was a Development Underwriter for the commercial sector, writing commercial combined, Property Owners and Contractors insurance.

There has been a shake-up at global health service company Cigna within its European operations – and it has announced a new face at the top to lead it into that new era. Having revealed that it will be combining its European operations spanning international organisations, the company has introduced Arjan Toor as its new CEO for the region. The new structure sees all of Cigna’s European business units brought together as it looks to accelerate innovation – it will still have dedicated offices in the UK, Belgium, Kenya, Dubai, Spain, Malaysia and the US.

It’s a big day for Admiral Group Plc, which hits us with a headline combo of its full-year numbers and the planned retirement of Co-Founder and Chief Executive David Stevens. In its succession announcement, the Cardiff-headquartered Insurer revealed the promotion of UK and European insurance head Milena Mondini de Focatiis to group CEO-designate, lining her up to take over from Stevens who is stepping down a year from now.

Top trade Credit Insurer Euler Hermes will have a new Group Chief Financial Officer come April. Taking on the role is the company’s current Group Head of Risk Underwriting Loeiz Limon-Duparcmeur, who will also join the management board at Euler Hermes. His predecessor, Chantal Schumacher, is making the switch to Allianz.

 

 

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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