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General Insurance Newsletter Friday 8th February 2019

08 Feb 2019

Insurance News

NMU has launched a stand-alone Terrorism product for motor fleet operators. The provider stated that the policy had been developed to recognise the changing nature of modern-day terrorist attacks, which has seen a significant shift towards causing human casualties using motor vehicles as weapons.

LV has confirmed that 140 people have been put at risk of redundancy as a result of a restructure in its claims team. The changes, as reported by the Bournemouth Echo, will affect people working in LV’s Bournemouth, Ipswich and Leeds offices. According to the provider the move comes as a response to changes in the Motor insurance industry and increasing customer expectations.

Greenock-based Broker Campbell Smith has been purchased by Greenwood Moreland for an undisclosed sum. The deal went through on 1 February 2019 and the Campbell Smith brand, office and team will all be retained. Both organisations are members of Broker Network.

Aon has revealed an 8% fall in profit for 2018 to $1.13bn [£864m]. The fall came despite swapping a $19m loss in Q4 2017 for a $345m profit in the final quarter of last year. Revenue at the global Broker increased by 8% in 2018 to $10.77bn even after a 5% drop in Q4 to $2.77bn.

Arron Banks-owned Eldon Insurance and the Leave.EU campaign have been fined a total of £120,000 by the Information Commissioner’s Office for serious breaches of electronic marketing laws. The regulator stated it was now set to review how Eldon, trading as Go Skippy Insurance and Leave. EU are complying with data protection laws. According to the ICO, its next steps will be to interview key employees across both organisations, including Directors, staff and Data Protection Officers.

The Financial Conduct Authority has outlined how it will use special transitional powers to ensure a stable regulatory environment if the UK leaves the EU without a deal. The Treasury has put forward draft legislation for transitional provisions if the UK leaves the EU without a withdrawal agreement. According to the FCA this is intended to minimise the disruption for firms and other regulated entities in this scenario.

Arthur J. Gallagher’s
Brokerage segment achieved an 11.3% rise in revenue to $4.25bn [£3.25bn] in 2018. The unit delivered a substantial rise in profit for the business, up 38.2% to $562.5m. The broking giant noted that adding in the risk management segment it delivered revenue growth of 10.8%, of which 5.9% was organic.

Chubb has launched a media industry practice for the UK and Ireland. The Insurer detailed that the new offering is aimed at mid-market and multinational businesses. It listed the target audience as companies working in advertising, public relations, brand development and publishing – including newspapers and magazines – as well as film, TV and radio broadcasting.

Igo4 is identifying suspicious activity and declining to quote on over 200,000 quotes a week, Chief Executive Matt Munro has confirmed. The Broker went live with a bespoke system including a fraud algorithm in January 2018 and said that it had seen success over the course of the year. Igo4 detailed that the new tools identify in real time if someone is attempting to purchase multiple policies under different names or engaging in suspicious activity when generating online quotations.

The Government has recently announced that London and Edinburgh will become the first UK cities to trial self-driving vehicle services. The trial projects, which will allow the public to ride autonomous buses on a 14-mile route across the Forth Bridge, or book self-driving taxis to travel around parts of London, support the government’s ambition to have driverless vehicles on UK roads by 2021. The autonomous vehicle revolution is set to transform the way we travel from A to B, with increased driver safety, better fuel economy and reduced congestion among the potential benefits.

The Chartered Insurance Institute has voluntarily published the ethnicity pay gap of its employees. Public disclosure of its ethnicity pay gap is an attempt by the CII to lead the sector by example and encourage dialogue around improving diversity and inclusion. Whether the government chooses to legislate in favour of mandating the ethnicity pay gap or not, as an organisation that falls beneath the government’s minimum size for reporting the CII would not be required to report its figures.

You can now quote and buy Aviva’s enhanced Property Owners offering on Fast Trade. They have updated their cover limits, simplified their product range and made it easier to place business with them for combined portfolios of up to 20 properties.

Emerging perils can provide exciting opportunities for insurance firms to pursue organic growth. The prospect of deploying capital into a new product like Cyber insurance and potentially becoming a market leader in that space, is something nearly all Insurers strive towards. Cyber is by far one of the hottest new perils to grasp the attention of insurance markets worldwide. Market capacity has grown considerably in the past decade, spurred on by developing social and regulatory frameworks around privacy and personal data protection, as well as a sharp uptick in malicious cyberattacks. Cyber insurance was born as a business interruption coverage for non-malicious cyber-triggered loss events. Since then, the product has evolved to protect firms against privacy breaches, malicious cyberattacks, systems failure coverage, contingent business interruption and contingent business failure. As a net new peril, some of those coverage aspects are still very difficult to underwrite, particularly when assessing contingent risks, according to Josh Ladeau, Global Head of Tech E&O and Cyber at Aspen Insurance.

Insurance-linked securities Fund Manager Leadenhall Capital Partners LLP is now majority owned by Japanese company Mitsui Sumitomo Insurance. In line with efforts to boost its ILS business, the MS&AD Insurance Group subsidiary acquired 80% of limited partnership equity in the London-based firm from MS Amlin Corporate Services. The latter is part of Mitsui Sumitomo Insurance’s UK subsidiary MS Amlin Plc. The remaining 20% is owned by individual partners, particularly eight members of management. Meanwhile the majority acquisition means the Fund Manager will now be directly under Mitsui Sumitomo Insurance, whose ILS unit is among the primary segments of its financial services operations.

Qatar Insurance Company has reported net profit of US$182 million and a 401% surge in net underwriting result for the 2018 financial year. The first domestic insurance company in the State of Qatar, QIC is the parent firm of global multi-line reinsurer Qatar Re, which last year acquired four Markerstudy insurance companies in Gibraltar. QIC’s full-year report includes the completion of the purchases, which added over £750 million to Qatar Re.   

Amid the ongoing debate surrounding the imminent arrival of autonomous driving, windscreen specialist Auto Windscreens – which is owned by Markerstudy Group of Companies unit Trifords Limited – is driving the discussion forward particularly when it comes to advanced driver-assistance systems (ADAS). Holding its Automotive Connecting Conference last week, the Chesterfield-based firm facilitated the exchange of insights to address concerns from the likes of fleets and Insurers involving major advancements in assisted and automated technology and what they mean to vehicle repairs.

To support building valuations undertaken by its surveyors, Ecclesiastical Insurance is conducting drone technology testing. “Heritage structures present unique access and maintenance challenges,” explained Mark Matthews, Risk Management Director at Ecclesiastical. “The use of drone technology gives us access to high-quality imagery and very accurate data, which would be near impossible to obtain via traditional surveying methods."

Global law firm Clyde & Co is expanding further in Europe’s biggest economy which is a massively significant market for its clientele. After recruiting four marine partners from Ince & Co, the UK-headquartered legal services provider – whose expertise includes insurance – has now opened a second German office. The expansion also sees 16 Associates come onboard the new Hamburg location.

Specialist Marine insurance Broker Seacurus is now part of Castel Specialty’s portfolio. The Castel Underwriting Agencies Limited unit previously bolstered its offering with the addition of coverages such as Construction and Political Risk. Now Marine has come onboard, with Angus Bailey leading Seacurus.   

Hiscox Chief Executive and Placing Platform Limited Board Chair Bronek Masojada has another role to play. The industry veteran, who is also currently a Board Member at the Association of British Insurers and a Pool Re Director, has been elected as alderman for the Billingsgate Ward of the City of London. Masojada bested five other candidates. Held at St Mary-at-Hill Church on Lovat Lane in Eastcheap, the election posted a 46% voter turnout and saw 52 votes in favour of the insurance boss. Fellow independent candidates Andrew John Heath-Richardson and Rachel Jane Kent garnered 25 and 15 votes, respectively.

Former Foreign Secretary and current MP for Uxbridge and South Ruislip, Boris Johnson, will close the British Insurance Brokers’ Association’s 2019 conference in Manchester, the trade body has revealed. According to Biba, Johnson will talk about what’s next for the Conservative Party and the country following “the latest twists and turns” around Brexit in his keynote speech. He continues the theme of high-profile political speakers at the event.

Willis Towers Watson has posted $695m (£537.8m) of profit for 2018 with $378m coming in the final quarter. The US-headquartered business has switched to a new accounting standard, however on a different like-for-like measure it noted that profit grew 36% over the year despite being lower in the final quarter. Revenue for the year rose 4% to $8.4bn and by 14% in Q4 to $2.33bn.

Zurich UK has posted improved results for the full year 2018. The Insurer stated that business operating profit in the general insurance space 2018 reached £137m, up from £50m the previous year. The COR, which deteriorated to 102.5% in 2017 also recovered to 94.9%.

Beazley has reported a 55% drop in pre-tax profit for the year ended 31 December 2018. The Lloyd’s provider posted a pre-tax profit of $76.4m (£59.2m) in 2018 compared to $168.0m in 2017. Chief Executive Officer Andrew Horton explained that the drop was due to a decline in investment returns.

ECIC has unveiled a Legal Expenses insurance product (LEI) for the contractor market. The Markel-owned Insurer cited figures showing that the cost of legal disputes in UK construction were at an all-time high and that tribunal cases rose sharply in the past year. According to the firm the new policy will enable regional commercial Brokers to offer contractors “valuable protection in the event of legal disputes”.

Markel has restructured its southern regional operations, creating three branch hubs in London, Bristol and Croydon. According to the provider Brokers in the South will now be able to refer e-trade and transactional new business to its dedicated e-trade team, Broker Connect. The team was established over two years ago and began to accept business under the new structure for the southern region on 21 January 2019.

Global Risk Partners has bought Trimulgherry Investments (TIL), for an undisclosed sum. TIL is majority owned by Peter Cullum, who also backs GRP and is made up of six Brokers and three managing general agents (MGA). According to GRP one of the Brokers, commercial specialist LDS Associates, will become its retail hub for North London and Essex.

Swiss Re Corporate Solutions has a new Cyber offering especially designed for small and medium-sized enterprises (SMEs). Developed exclusively with French cybersecurity specialist OZON, CyberSolution 360° merges insurance with cyberattack protection services to help organisations with a workforce of 10 to 250 in managing digital perils. First available in France starting February 06 2019, the risk management solution will be introduced to other European markets within the year. It covers cyber incident management, first-party losses and third-party claims.


Market Movers and Shakers

Covéa Insurance is pleased to announce the appointment of Graeme Howard to the role of Chief Technology and Information Officer. Graeme will begin his role at the end of February 2019. Graeme has a wealth of experience as a senior IT professional, having held a number of Director level roles at Motorola Solutions Ltd and most recently as Group CIO at Santa Fe Relocation Ltd. He has experience of leading transformational projects as well as being responsible for all technology matters at executive level.

There is a new man at the helm of RSA UK and International after the company announced the departure of Steve Lewis. Lewis, the CEO of the UK and international division of RSA Group, joined the firm back in 2015 but is now being replaced by Chief Financial Officer Scott Egan with immediate effect. Egan will continue to report to group CEO Stephen Hester, with RSA now searching for a replacement for the CFO role.

Lloyd’s of London
 has appointed Burkhard Keese as its Finance Chief. The appointment takes effect April 01 2019. Kees joins Lloyd’s after 14 years with Allianz, according to a Reuters report. At Allianz, Keese served as Chief Financial Officer for Allianz Deutschland AG, Germany’s largest Insurer. Keese’s appointment comes after Lloyd’s named a new Chief Executive in the wake of a 2017 loss of £2 billion due to a series of natural catastrophes, Reuters said.

Hyperion Insurance Group’s new business now has a Chief Data Officer. Announced in October 2018 and launched on New Year’s Day, Hyperion X is the insurance intermediary group’s data and technology arm. Joining from biopharmaceutical company MSD to serve as Chief Data Officer is Miguel Baptista, who previously worked as Senior Director of information platforms.

Global insurance Brokerage and financial technology firm, BGC Partners, Inc.  has finalised its purchase of Ed Broking Group Limited (Ed), a global wholesale insurance and reinsurance Broker tied to Lloyd’s of London. Ed, which is known for its strength in specialty insurance lines, will become part of BGC’s insurance division, which was created in 2017 with BGC’s acquisition of Besso Insurance Group Limited. Ed’s group CEO, Steve Hearn, will become head of BGC’s insurance division.

Ed in turn announced the appointment of Laura Skaanild as Client Director, Professional and Executive Risk. She will report to Paul Richards, Managing Director of Professional and Executive Risk.

Coverys Managing Agency Limited, the Lloyd’s managing agent of Syndicates 1975, 1991, 3330 and 1110, announced the appointment of David Reed as Non-Executive Chairman of Coverys Managing Agency, subject to the normal regulatory approvals. 

Global insurance Broker G&M International have announced the addition of London Market Broker Graham Roberts to their expanding team. Graham will have responsibly of growing the General & Medicals Groups current Medical/Accident and Health business, as well as developing a variety of new products within this field.

Lloyd’s has confirmed the appointment of David Duclos as Non-Executive Chairman of Lloyd’s Global Network, where he will play a key advisory role in the development of Lloyd’s international network.

Burkhard Keese has been confirmed as the Chief Financial Officer of Lloyd’s following the unanimous approval of his appointment as successor to John Parry by the Council of Lloyd’s. 

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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