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General Insurance Newsletter Friday 6th November 2020

06 Nov 2020

Hyperion Insurance Group has announced it's new name, as part of a rebranding exercise. Howden Group Holdings, will be used effective immediately. The firm was originally founded in 1994 as Howden Pangborn, and only evolved into Hyperion after the launch of DUAL in 1998.

RSA has announced it's Q3 2020 financial results, revealing the ongoing impact of the Covid-19 pandemic. They highlighted that trading conditions were largely unchanged in Q3, with Non-COVID-19 claims frequency down from last year in Q3, in a range of 8-36% which the insurer said mostly reflects lower economic activity. Group net written premiums of £4,663 million are down 3% from Q3 2019 (excluding the estimated impacts of COVID-19 and in line with its plans) and, in UK & International, premiums are down 6% to £1,998 million (or 2% excluding the estimated impact of COVID-19).

A series of natural calamities including hurricanes Laura & Sally, combined with wildfires in the US have hit Lancashire Holdings Ltd hard this past quarter. In the nine-month period to September 30, the Insurer estimated its catastrophe losses in the third quarter to be between US$65 million and US$75 million (around £50 million to £58 million). Despite these losses, Lancashire is seeing positive signs with gross premiums written posting a 14% year-on-year increase to US$658.7 million (around £506 million). The Insurer also revealed strengthening premium rate increases across its business portfolio, with RPIs of 117% for the quarter and 112% for the year.

A report issued by Marsh has revealed that global commercial insurance prices rose by 20% in Q3 2020, news which marks the twelfth consecutive quarter of price increases.

Brightside Group’s
2019 financial results have revealed double-digit growth in policy sales, amid what was described as a challenging yet positive year for the Bristol-based Broker. The firm’s policy sales jumped 26% to slightly more than 231,000 last year, with its Motor book, consisting of car (66%), van (21%), and bike (11%) insurance, all delivering double-figure increases. Gross written premiums remained steady at £53 million, with its commercial business, which accounted for 40% of the overall GWP, posting an 18% rise to £125 million from £106 million in 2018.

One of Sweden’s largest private Insurers, Folksam Group, which oversees about US$50 billion in insurance assets, accidentally allowed several tech giants including Google, Facebook, LinkedIn, Microsoft and Adobe, to gain access to private data that affected up to one million customers. The breach was discovered during an internal audit.

Willis Towers Watson (WTW) has released it's third quarter results for 2020, generating a modest revenue increase of 1% to US$2.0 billion (approximately £1.53 billion). Year to date revenue was US$6.59 billion (approx. £5 billion), an increase of 4% on the 2019 figures. Net income for the third quarter of 2020 was US$122 million (approx. £93.5 million), an increase from net income of US$80 million (approx. £61.3 million) for the prior-year third quarter. For the nine months ending September 30, 2020, net income was US$537 million (approx. £411.6 million), an increase from US$522 million (approx. £400.1 million) in 2019. 

Arthur J Gallagher (AJG) has reported its finances for the quarter ended September 30, 2020. AJG earned adjusted net income of US$255.6 million (approx. £196.79 million) up from US$182.9 million (approx. £140.82 million) in Q3 2019 with diluted net earnings per share of US$1.30 (approx. £1), up from US$0.94 (approx. £0.72) in Q3 2019. The brokerage reported an adjusted net income for 2020 of US$822.9 million (approx. £633.57 million), for the first nine months of 2020, up from US$647.9 million (approx. £498.83 million), in the same period last year.

Marsh & McLennan (MMC) is certainly continuing its winning streak, based on its Q3 results. In Q2 MMC reported a 30% increase in operating income, while its adjusted operating income jumped by 10% to US$984 million. It's the same story for the third quarter (Ended September 30), with operating income up 15% (to US$540 million from US$467 million) and adjusted operating income increasing 9%. Additionally, for the whole of the nine-month period, operating income was up by 20% and adjusted operating income saw a bump of 12%.

London has seen a sharp rise in premium volumes coming from the US this summer, a recent survey from the London & International Insurance Brokers’ Association (LIIBA) has found. According to the report, total Property and Casualty (P&C) premiums for US businesses were 25% higher in July this year compared to the same period in 2019. Reinsurance premiums coming from the US also rose, posting a year-on-year increase of 40%.

It has been a rosy period for Aon Plc, which has released its financial results for the third quarter of 2020. Q3 saw both its and Willis Towers Watson’s shareholders “overwhelmingly” approve all necessary proposals for their mega merger, net income from continuing operations attributable to Aon shareholders for the three months ending in September 30 stood at almost US$274 million (around £212 million) or US$1.18 per share, increasing from US$223 million (around £180 million), or US$0.93 per share, in the same period last year.

NARDAC, a California-based specialist energy and infrastructure insurance Broker, is expanding into Europe by opening a new office in London. The office will be led by Peter Draper, former International Property Director at AFL, NARDAC said in a statement. 

Hiscox has also announced its Q3 2020 results, gross written premiums (GWP) have grown over this period by a modest 2% to US$3,262.4 million, compared to 2019’s GWP of US$3,212.6 million. This growth was driven by rate improvement and growth in customer numbers across business lines. Meanwhile, in Q3 specifically, premiums grew by 15%.

Kitsune, the Managing General Agent operated by Brightside has announced that it is to shut it's doors to new business and go into run-off. The move puts 16 staff at risk of redundancy and a consultation is underway. According to a statement from Brightside CEO Brendan McCafferty, the MGA had been performing but did not now fit in with Brightside’s investment priorities.

Lloyd’s of London has announced that it will reduce operating expenses by £800 million, about 3% of its overall costs, over the next two years by speeding up the underwriting process and increasing automation. In a statement by Lloyd’s Chief Operating Officer, Jen Rigby,  they commented that the plans would “deliver truly revolutionary change for the market, ensuring the future of the Lloyd’s market is digital from start to finish, with data at its core.”

 French Insurer AXA has confirmed that it will give its XL unit a cash infusion worth €1 billion, to strengthen its capital position after the business was impacted by both coronavirus claims and natural catastrophes. The news came after AXA reported an 8% drop in year-to-date revenue and said it was expecting a limited impact on claims from a second wave of coronavirus lockdowns.

Lloyd’s of London has announced changes to the schedule of operations of its underwriting room as the country gears up for a second national lockdown. Between November 05 and December 02, Lloyd’s said that its underwriting room will be open only on Wednesdays.

The British Insurance Brokers’ Association (BIBA) has revealed that its 2021 annual conference will take the form of a digital conference and exhibition experience. BIBA conference Director Lindsay Campbell, said the decision "was made after much consideration of the current situation in the UK", and that it would be “impossible and unwise to hold a physical event next May.”.

Hiscox is set to lose another £31 million, if coronavirus-related travel and commercial restrictions carry on into 2021. In its recently released third quarter results, the Insurer said the potential pay-outs will come on top of the nearly £300 million it has already allocated for claims related to the first lockdown in March.

The Supreme Court has set a date for the appeal of the Financial Conduct Authority’s test case on Business Interruption insurance relating to the coronavirus pandemic lockdown – a case which could impact thousands of businesses and their Insurers. The four-day hearing will start on November 16, according to a court statement.


Insurance brokerage Michael Rollett & Co has now been successfully acquired by Worcestershire-based insurance brokerage Hazelton Mountford. With Rollett himself recently taking the opportunity to retire, Hazelton Mountford was seen as the “natural choice” for his accounts as the only chartered insurance Broker in the county.


Specialist professional services and technology company Davies has announced the acquisition of Johnson Claim Service, a transportation claims specialist providing third-party administration, adjusting and appraisal services.

Charles Taylor has agreed to acquire Lab Cosulich Consultants (LCC) and CMC Marine (CMC), together known as the Cosulich Group. The deal will expand Charles Taylor’s Marine capabilities in Europe, the Middle East and Asia. The acquisition is expected to be complete by the end of 2020.

Specialty Underwriter Argo Group has announced that it is exiting the reinsurance business to “focus on specialty insurance lines of business.” The firm has agreed to sell Ariel Re to private equity investors, Pelican Ventures and J.C. Flowers & Co.

GRP Yorkshire hub Marshall Wooldridge has acquired RIB Group (Rotherham Insurance Brokers). RIB specialises in commercial lines, personal lines and high net worth schemes, employs 35 people, and is led by Chairman John Jesson and fellow Directors Paul Barton, Andrea Beck and Simon Jesson. All of the Directors and staff will remain with the business post deal as well as the RIB brands. 

RSA Insurance Group has allegedly received a take-over bid of £7.1 billion from a consortium of Canadian Insurer Intact Financial and Danish Insurer Tryg. According to reports by both Bloomberg and Reuters, the UK-based Property & Casualty Insurer has released a statement confirming the proposed cash bid of 685 pence per RSA share – an offer that would represent a 49% premium to RSA’s Wednesday closing price on the London Stock Exchange.

WILLIS Insurance and Risk Management (Willis), one of the UK’s largest independent and family owned insurance Brokers, has made two strategic appointments having set their sights firmly on London and on further expansion.Jonathon de Mendonça joins the team as Group Market Management and Development Director and Mark Hicks has been appointed to lead a new London brokerage, Arden Insurance Brokers.

ArgoGlobal, a Lloyd’s Insurer and member of Argo Group, has announced the appointments of Henry Gillingham as a political violence and war class Underwriter, Chris Marsh as Underwriter, and Chris Sparrow as Underwriting Assistant.

Marsh JLT Specialty has a new senior appointment in its Aviation practice. The insurance Broker and Risk Advisor has announced that Tony Ambrose will take on his new position as Deputy Chief Executive Officer in the company’s Aviation division, effective immediately. He will report directly to UK Chairman and Aviation CEO Andy Smith.

Avid Insurance Services Ltd has made a number of internal promotions to its underwriting team. In a statement, the company announced that John Inwood, previously Commercial Development Director, will become Underwriting Director. Mike Patchett will take on the role of Head of Specialty, Dan Baldwin and Lee Longley were promoted to Head of Travel and Head of Commercial, respectively and all 3 will report to Inwood.

Stockport-based C&C Insurance Brokers has continued to bolster its business with the opening of a new office in Dudley. The independent Broker has also announced the appointment of Phil Caffery as Director and head of the new branch.

Adam Beckett has been appointed as Ageas UK’s new Chief Distribution Officer (CDO) and will start with the business at the beginning of 2021.

Sarah Breslin has joined Pen Underwriting’s executive team and been appointed Chief Financial Officer, subject to regulatory approval. She succeeds Praveen Panicker as CFO, while Panicker is moving across to Gallagher’s corporate finance team.

Partners& has appointed James Porter as Head of Business Protection, reporting to Group Commercial Director, Chris Jelf. The appointment is an important part of the Partners& strategy to embed people risks within its business insurance offering. James will be responsible for building the team and developing the Partners& proposition.

 

 

 

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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