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EC News (8th November 2018)

November 08, 2018

Round-up of the weekly news and developments from the global (re)insurance market with stories from Miller, Markerstudy, QBE and more.

Miller promotes quintet to equity partners

Miller has strengthened its partnership through five internal appointments as it announced the retirement of four senior executives.

Effective 1 January 2019, James Hands, Charles Lane, Phil Wheeler, Martin Henderson and Ben Speers will become equity holding partners in the business.

Concurrently, Julian Taylor, Brian Rivett, Xavier Villers and Andrew Miller are set to retire at the end of 2018 and in early 2019. 

“All four individuals have made a significant contribution to Miller and have been actively involved in working with us to ensure a smooth transition, both internally and with clients,” the broker said in a statement.

Hands serves as head of Miller’s accident & health department, overseeing the strategic development of the sport and entertainment business. He joined Miller in 2015 from Aon, where he was managing director of Europe, Middle East and Africa.

Meanwhile, Lane leads Miller’s liability wholesale offering to clients, working with property and casualty specialists to expand the broker’s capabilities internationally, having joined the firm in 2014.

Wheeler leads the broker’s marine liability reinsurance team, developing reinsurance solutions for P&I Clubs, both collectively through the International Group, and individual club business. He joined Miller in 2012, initially responsible for developing its in-house actuarial team.

Henderson heads up the marine, energy and transportation liability (METL) team, focusing on the production and placement of liability business at a primary and excess level for a diverse range of energy, marine, construction and transportation clients, initially joining Miller in 2003.

Speers serves as COO of Miller, a position he has held since 2016. He is primarily responsible for leading the management services unit, which delivers all operational services to the business. He joined the broker in 2011 as head of legal.

Commenting on the appointments, Miller CEO Greg Collins said:“I am delighted to announce the appointment of these talented leaders to equity partners as their skills and professionalism are key to our continued success. We place great importance around succession planning at Miller in order to continue delivering to the high standards expected from us. 

“At the end of this year and early next year, a number of senior individuals will be retiring and appointments such as these ensure there will be no impact on the service we offer to our valued clients. On behalf of the board, I want to thank Julian, Brian, Xavier and Andrew for their valued contributions to Miller and wish them well in their future endeavours”.

Markerstudy close to £300mn Co-op insurance deal: report

Markerstudy is reportedly nearing an agreement to takeover Co-op's insurance business, according to Sky News.

On 6 November, the news outlet reported that the Qatar Re-owned motor insurer is in “detail talks” with Co-op about a potential £300mn sale of its general insurance arm.

Sky News said that discussions between the parties are at an advanced stage, although a definitive decision to proceed with a transaction has yet to be reached by either of the two boards.

Whilst Markerstudy has emerged as the frontrunner for the takeover, Sky News noted that AA, Aviva, RSA Insurance and Saga are among those who are understood to have expressed an interest in a deal with the Co-op.

The mutual, which has recovered strongly from its near-collapse in 2013, has been exploring a sale of its insurance operations since the summer,Sky News said.

The Co-op’s underwrites its own home and motor insurance policies, while travel insurance policies are underwritten by Mapfre. It also sells pet insurance with Allianz.

Sky News noted that the disposal of the insurance arm, generated £11mn in underlying profit in 2017 on £331mn revenue, is being viewed sensitively within the Co-op Group because of its prospective impact on the insurance division's c.1,000 headcount.

Citing sources, the news outlet further added that any buyer would have to agree to sell Co-op branded insurance products.

The Co-op attempted to sell its general insurance business in 2013 – the same year in which sold its life insurance business to Royal London – but the process was abandoned in early 2014.

Markerstudy, which underwrites more than five percent of the UK motor insurance market, operates through brands such as Zenith and works with more than 1,000 brokers and intermediaries.

QBE merges European and Asian operations

QBE has announced a restructure of its operations that will see its European and Asia businesses combined into one division from 1 January 2019.

The Australian carrier said that the changes to its structure are “an important step towards further simplifying its operations building a more streamlined, agile and customer-oriented business”.

Following the underwriting remediation in Asia, which QBE said is now largely complete, Asia Pacific will no longer be a separate division.

Instead, QBE intends to create a new international division that will encompass its European Operations and Asia, that will sit alongside a newly established Australia Pacific unit and its existing North America business.

The carrier said that Richard Pryce, currently CEO European Operations, will become CEO International, adding that a new senior leader for Asia will be appointed and will report directly to Pryce.

Meanwhile, the Australia Pacific business – which will include Australia, New Zealand, the Pacific and India – will be led by Vivek Bhatia, currently chief executive of QBE’s Australian & New Zealand operations, who will assume the role of CEO Australia Pacific.

North America will continue as is, led by CEO North America, Russ Johnston.

Alongside the restructure, QBE announced that Jason Brown will move from the position of CEO Asia Pacific Operations to the new role of group chief underwriting officer. 

In his new position, Brown will be responsible for underwriting, pricing and reinsurance placement and will play a critical role in driving QBE’s “Brilliant Basics”agenda globally.

The carrier said that the changes to simplify and streamline its operations will “contribute to the group’s efficiency agenda with much of the administration and governance of the former standalone Asia Pacific operations absorbed by the significantly larger and better resourced International and Australia Pacific divisions”.

QBE chief executive Pat Regan said: “Today’s announcement represents the next step in creating a stronger, simpler QBE. These changes enable QBE to enhance our customer proposition and build a stronger platform for long term, sustainable and profitable growth.

“The Asia Pacific region remains important to QBE. Following a significant and successful program of work to remediate Asia Pacific Operations and its improved underwriting performance, we continue to see opportunities in these markets.”

He added: “Asia Pacific and European Operations are already collaborating in relation to underwriting opportunities and we expect to see further benefits from leveraging our underwriting expertise, scale and global capabilities across these business divisions.

“Aligning Asia with European Operations and the Pacific with Australian & New Zealand Operations will ensure we are best placed to support our customers and partners in those regions.”

“I would like to personally thank Jason and his team for the turnaround they have led in these markets over the past 12 months and look forward to Jason bringing the same level of focus and discipline to our Brilliant Basics agenda,” Regan concluded.

Ardonagh sells UK commercial lines business to Arch

Arch Insurance Europe has agreed to acquire Ardonagh’s UK commercial MGA businesses.

The asset-only deal will see Arch take over the renewal rights for the Arista, Fusion, Towergate Personal Accident and Travel, and Towergate Commercial MGA brands from 1 January 2019, which collectively generated more than £150mn of gross written premiums in 2017.

Under the terms of the transaction, Arch will pay Ardonagh a consideration of up to £31mn for the commercial lines segments of its MGA Geo Underwriting, which is conditional upon performance criteria.

Around 250 employees from these businesses and nine associated offices will transfer from Ardonagh to Arch as part of the deal.

Proceeds of the sale will be used for further investment in the group, whilst confirming that Geo Underwriting’s personal lines, private clients, specialty and agriculture brands AIUA and BIBU remain as part of the group.

Arch said the deal will give it “a meaningful presence and an extended office network” across the UK that will complement its existing London Market business that is focused on wholesale distribution and delegated authority business.

It added that the acquisition forms part of its strategy to grow its regional UK presence, with minimal overlap with the existing Arch business written in the UK.

Matt Shulman, Arch Insurance Europe president and CEO, said:“We have a clearly stated strategy to build out our distribution capabilities across the UK and Europe and the acquisition of Geo’s commercial lines business represents an important step in this process, building upon the success of the earlier acquisition of Axiom Underwriting.”

He added: “By expanding our regional presence with the addition of nine offices we immediately gain scale and presence in our target markets and we can deliver a broader range of specialist insurance solutions through a network of over 2,000 brokers,

“We are gaining a well-respected and highly experienced team of underwriting and distribution professionals who are perfectly placed to help us build a significant and sustainable business that can meet the growing needs of its clients.”

Meanwhile, Ardonagh CEO David Ross remarked: “Almost 18 months after the creation of the Group, we now find ourselves looking across our portfolio and assessing where we can drive organic growth from leading positions.

“For us, an MGA is most effective in niche and specialist areas. While we’ve undertaken strategic remediation actions within our commercial MGA lines over the past two years and worked with carriers to improve loss ratios, these books now fall outside that strategy and we believe are best placed to succeed within an insurance company. Arch therefore provides the perfect platform from which to drive these businesses forward.”

Canopius taps Folliard as claims head

Canopius has named Gabrielle Folliard as its new head of claims.

Folliard moves over to the Lloyd’s carrier from Markel International, where she most recently served as head of specialty and financial lines claims.

She will assume her new role in early 2019 and will report to group chief operating officer, Laurie Davison.

Commenting on the appointment, Davison said: “Gabrielle has extensive experience in claims management and a strong background in insurance legal practice and is well regarded across the market. 

“She works collaboratively to achieve the best results for customers and all stakeholders. We are delighted to appoint her and look forward to welcoming her to the team.”

Folliard added: “It’s an exciting opportunity to head a team that is well known across the market for its excellent claims service and responsiveness. I look forward to joining Canopius and helping to move the claims function forward.”

Occam Underwriting makes senior appointments

Occam Underwriting has tapped former Ironshore executive Mark Fisher as CFO and promoted Daniel Carr to the board of directors.

Fisher joins the speciality managing general agency (MGA) from Ironshore, where he most recently served as director and head of international finance. Prior to that, he held a number of senior roles at CNA Insurance, including as European financial controller.

Meanwhile, Carr has been with the firm since 2015 and has led the cyber practice for the past eighteen months. As well as joining the board, Carr will continue in his role as head of innovation and cyber insurance. 

The appointments come after Sciemus rebranded to Occam Underwriting in July as part of a series of changes which included the resignation of former Sciemus chief Rick Welsh and the subsequent appointment of Lance Gibbins as chairman and CEO of the company.

Gibbins remarked: “The appointments of Dan Carr and Mark Fisher to senior positions at Occam Underwriting is a continuation of a programme to build a strong management and board of directors.

“We have genuine industry experts on all of our teams, each shaping the approach we undertake. By both leading their respective teams and being partners in the executive management, they will make significant strategic contributions to the future of our business.”

Markel creates standalone marine and energy divisions

Markel International has split its marine and energy division into two standalone units, appointing Chris Fenn and Julian Samuel as managing directors of the respective separate businesses.

Both appointments will become effective from 1 January 2019.

The firm said that the move reflects the “impressive growth” of the marine and energy division, which under Paul Jenks’ leadership has become the single largest unit within the company, with gross written premiums of around $400mn.

As executive director of marine and energy, Markel added that Jenks will continue to play a critical role in the development of both divisions.

Markel’s London wholesale businesses will now be formed of three units, marine, energy and specialist and financial lines, the latter led by James Hastings.

Markel International president William Stovin commented: “As we plan for the long term success of our international, London based businesses, the new structure will give Chris and Julian and their teams the responsibilities for continuing the profitable development of their businesses.”

Ensurance UK to offer Beazley-backed cyber cover

Specialist managing general agency (MGA) and Lloyd’s coverholder Ensurance UK has entered the cyber market with an offering aimed at the construction sector, backed by Beazley.

Ensurance has been appointed as a distributor for the cyber insurance product, which is designed to minimise business disruption caused by a cyber-attack or data breach and facilitate faster recovery following an incident.

The firm stated that the cover will be available to any policyholder responsible for handling customer data, and will provide access to Beazley Breach Response, as well as coverage for first and third-party liability, cyber extortion, data protection loss and business interruption.

Ensurance UK CEO Tim James said: “As a specialist in construction, we understand the risks firms in this sector face with the data they hold and the potential impact on their business from any form of cyber security breach or attack.

“We have responded with a comprehensive product supported by Beazley that will offer flexibility on coverage and limits supported by excellent capacity.”

He added: “Most importantly the policy is supported by a dedicated team of experienced cyber breach professionals who assist policyholders at every stage of incident investigation and breach response. They coordinate the carefully vetted forensics experts and specialist lawyers to help establish what’s been compromised, assess responsibility, and notify those individuals affected. In addition, the support team manage credit or identity monitoring for customers and crisis communications.

“Beazley has been at the forefront of defending clients against claims arising from cyber breaches in a rapidly evolving legal environment.”