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EC News (24th August 2017)

August 24, 2017

Round-up of the weekly news and developments from the global insurance market with stories from Ascot, Hellman & Friedman, MS Amlin and more. 

Ascot launches Ethos MGA under Sillat

Ascot has launched a standalone managing general agent (MGA) platform under the leadership of former Ryan Specialty Group (RSG) executive Mike Sillat.

Ethos Specialty Insurance Services is owned by Ascot Group Limited (AGL) and will operate as a separate entity to the Ascot Underwriting (Syndicate 1414 at Lloyd's) and Ascot Underwriting Bermuda divisions.

Sillat, who will become CEO of Ethos effective 1 December 2017, joins from RSG-owned MGA WKFC Underwriting Managers where he was most recently president and CEO. He originally joined WKFC in 2002 as CFO, then assuming the role of COO in 2008 before becoming CEO in 2011.

Once on board Sillat will work closely with global head of strategy Greg Wolyniec, who was recently hired by Ascot to lead strategic and investment initiatives and assist with the formation of a standalone MGA platform.

Meanwhile, Ascot also announced that another former WKFC executive, Justin Meizlik, had joined Ethos as COO of the business. Prior to joining, Justin served as head of audit and programme implementation at WKFC.

Ascot said that the formation of Ethos “represents an important step in AGL’s long term strategy to invest and build a global property and casualty insurance and reinsurance platform”.

The launch of Ethos comes eight months after the Canada Pension Plan Investment Board (CPPIB) completed its $1.1bn takeover of Ascot.

Commenting on the announcement, Ascot CEO Andrew Brooks said: “Leadership, operations, and controls are key to building any successful business, especially where the strategy is a combination of organic growth and M&A, such as is the case for Ethos.

“Michael and Justin’s multi-year experience in building and executing operating platforms for myriad MGAs and programmes will be invaluable as we begin to execute our strategy. We look forward to having them both on the Ethos team.”

Meanwhile, Sillat said that he was looking forward to “building what will be the preeminent MGA in the specialty arena”.

Hellman & Friedman said to be exploring Hub stake sale: report

Hub International’s private equity backer Hellman & Friedman is reportedly exploring the sale of a stake in the broker in a deal that could value the intermediary at between $6bn and $7bn, according to Reuters.

The move follows Hellman & Friedman's acquisition of Hub in 2013 from fellow private equity firm Apax Partners in a $4.4bn deal.

In a report dated 17 August, Reuters said that Hellman & Friedman would retain a controlling interest in Hub in any deal, citing sources it did not name.

The publication said that Hellman & Friedman has hired an investment bank to explore the stake sale, adding that one source had indicated that several private equity firms, sovereign wealth funds and public pension funds are considering an investment in the Chicago-based intermediary.

Hub provides personal, business and employee benefit insurance products through more than 400 brokerages across Canada and the United States. It was founded in 1998 with the merger of 11 privately held insurance brokerages and now ranks as the eighth-largest broker in the world.

Hub has been highly acquisitive in recent years, acquiring hundreds of small and mid-sized brokers.

The company generated total revenue of $1.6bn for the 12 months through September 2016, according to Moody's Investors Service, Reuters said.

The speculation follows a number of PE broker deals in recent months.

At the end of July, Carlyle Group sold its majority interest in Epic Insurance brokers to another private equity firm, Oak Hill, in a $997mn deal.

Meanwhile, in March, Onex Group sold its stake in USI Insurance Services for $4.3bn to private equity firm KKR and Canadian pension fund Caisse de dépôt et placement du Québec (CDPQ).

Rash to succeed Hextall as MS Amlin CFO

MS Amlin has announced that its long-serving chief finance and operations officer Richard Hextall will be leaving the carrier at the end of September after 18 years with the company.

Hextall will be replaced by Chris Rash, who Hextall hired as a successor in 2016.

MS Amlin highlighted that when Hextall joined legacy Amlin in 1999, the firm had gross written premiums (GWP) of £450mn and net tangible assets of £227mn. In 2016, it had GWP of £2.8bn and net tangible assets of £2.9bn.

Meanwhile, the company said that Piyush Patel will continue in his role as COO and will now report to MS Amlin CEO Charles Philipps.

Commenting on the news, Philipps said: “Richard has made a major contribution to MS Amlin over a long period. He was a key player in helping build the Group to what it is today as well as being a highly regarded CFO in the listed insurance sector.

“We have been extremely fortunate to have had his dedicated contribution for so many years and he has our sincerest thanks for all he has done. We wish him every success in the future”.

NexAssure launches London MGA for European expansion

Singaporean MGA, administrator and consultancy firm NexAssure Group has announced it will be opening a specialist managing general agent (MGA) in London to promote the company’s expansion into Europe and Middle East.

The company has hired senior underwriter Mark Angel to lead the new business, NexAssure Agency (UK), as head of speciality. Prior to joining the company, Angel served as chief underwriter at WhiteOak Underwriting Agency.

NexAssure is led by CEO Anthony Hobrow, the Whittington Group founder, and has offices in London, Hong Kong and Kuala Lumpur as well as Singapore.

NexAssure provides warranty, financial and specialty reinsurance through NexAssure Agency and third party administration services through NexAssure Management.

Commenting on the appointment, Hobrow said: “Mark is a well-known and highly regarded warranty underwriter. Appointing someone of his quality to our new London office, demonstrates our commitment to provide best in class client services and solutions. Our expansion into these new regions reinforces our growth ambitions.”

Munich Re introduces energy sector cyber cover

Munich Re Syndicate at Lloyd’s has introduced an insurance solution to cover cyber exposure for the independent oil and gas sector.

This cover will encompass both traditional data breaches and any physical loss or expense associated with a potential cyber-attack.

The company said that the operational and financial complexity of this particular sector presents growing threats to cyber risk, due to increased connectivity, sensitivity of data, unmanned operations and complex royalty payment structures for onshore operators.

The likely recurrence of cyber-attacks is expected to intensify as the link between technology and business continues to evolve, it added.

The reinsurer’s new cyber solution combines the firm’s expertise in cyber and energy underwriting skills to meet growing demand for cyber cover within the oil and gas sector.

Munich Re Syndicate chief underwriting officer Dominick Hoare said: “There is a heightened level of awareness around the risk of a cyber-attack on the oil and gas sector, particularly in the wake of recent events which have caused significant economic disruption.

“As automation and integration expose the oil and gas industry to new vulnerabilities, Munich Re is working to deliver a product that will compliment companies’ contingency measures to ensure that they are well prepared should a cyber incident occur.”

The foundation cover includes provision for full cyber-attack buyback and a data breach cover. The product will be predominantly focused on the upstream sector, covering the automated aspect of a company’s operations.

This product will complement the existing Munich Re cyber solution “Vector” partnership with Beazley, which focuses on very large corporate clients.

Willis Towers Watson appoints new CFO

Willis Towers Watson (WTW) has hired Michael Burwell as its new CFO, succeeding Roger Millay who retires in October.

Burwell joins WTW from PwC, where he was most recently partner and brings with him 31 years’ experience within the financial and professional services industry.

During his time at PwC, he has held a number of senior leadership roles including head of global transformation, COO, CFO  in the US along with head of transaction services in the US.

In April, WTW announced that Millay will be voluntarily retiring from the company.

Commenting on the appointment, WTW CEO, John Haley said: “We are excited to have Mike join our leadership team at an important point in our company’s evolution. Mike understands managing, leading and driving results in a complex, global company with a strong focus on clients. I am confident that his expertise in finance, transactions and transformation is well suited to guide our long-term growth and remaining integration efforts – allowing us to achieve our full potential as Willis Towers Watson.”

JLT Specialty hires Walsh as head of environmental

JLT Specialty has appointed former AIG UK lead environmental underwriter Emilie Walsh as head of environmental within its London P&C team.

Walsh joins the broker from AIG, where she spent more than six years, more recently leading the UK environmental underwriting team at the carrier.

JLT Specialty said Walsh has been involved in a broad range of complex and major risks covering a range of industries, including but not limited to the construction, real estate, energy and manufacturing sectors.

In her new role, Emilie will be consulting with JLT’s industry facing professionals and clients, working closely with clients to advise them on any existing exposures, as well as emerging environmental risks, delivering bespoke solutions to their current and future environmental risk and insurance needs. 

Simon Delchar, CEO of JLT's Specialty Property & Casualty team, said Walsh's experience will help the broker meet increasing demand for environmental insurance.

"There is growing concern amongst businesses about their environmental exposures both past and present, and many are increasingly looking for specialist advice and guidance on this issue," he said.

Liberty Specialty Markets hires Wilson from Fidelis

Liberty Specialty Markets has appointed Jennifer Wilson as an underwriter within its global financial risks team in London.

Wilson joins the company from Fidelis, where she was an underwriter focusing on political and credit trade risks. Before joining Fidelis, she spent four years at XL Catlin as an underwriter for the political risk and credit team in London.

Wilson will have a general underwriting role across all parts of LSM’s global financial risks product line. She will report to head of London Markets financial risks, Huw Owen.

Commenting on the new appointment, LSM Head of Global Financial Risks, Peter Sprent said: “We are very pleased to have Jennifer join our London team. She’s a respected underwriter whose experience in political risk and credit is an excellent addition to our underwriting capabilities. Her arrival enhances our ability to deliver creative and tailored solutions to our clients.”