March 05, 2020
Round-up of the weekly news and developments from the global (re)insurance market with stories from Covéa, AXA XL, Fidelis and more.
Covéa to acquire PartnerRe from EXOR
French insurer Covéa have reached an agreement with holding company EXOR over the sale of Bermuda based reinsurer PartnerRe which is wholly owned by EXOR. They have entered into a Memorandum of Understanding (MoU) under the terms that EXOR would receive a total cash consideration of $90bn plus a cash dividend of $50mn to be paid before closing.
In 2016, EXOR acquired Partner Re for a cash total of $6.72bn representing roughly a 30% profit for the company. Since then EXOR has worked closely with the company to strengthen and develop the company’s business and expanding its presence in Life and Health reinsurance.
In a recent press release, EXOR explains PartnerRe’s operating performance since 2016 has enabled it to pay EXOR a total of $661mn in dividends and to increase its book value to common shareholders by $510mn to $6.57bn. The firm notes that this was achieved despite the recent challenges witnessed across the reinsurance industry.
Including dividends received since 2016, the aggregate cash return to EXOR following completion of the proposed transaction will amount to $3 billion.
The proposed transaction is expected to be completed by the end of this year, subject to customary closing conditions, antitrust, regulatory and other approvals.
John Elkann, chairman and CEO at EXOR, commented: “PartnerRe today is a stronger company, with a more complete and efficient business. We have now been presented with an outstanding chance for PartnerRe to further strengthen its competitive advantage while providing important new opportunities for its people under Covéa’s ownership. We are proud to have fulfilled EXOR’s purpose of building another great company and are grateful to PartnerRe’s Board, leadership and people for all they have done to make this possible.”
Emmanuel Clarke, the CEO of PartnerRe, added: “Over the past four years, under EXOR’s ownership, we have strengthened PartnerRe’s position as a global, diversified reinsurer, thanks to a continuous focus on enhancing our client and broker franchise, our underwriting and investments portfolios and our operational efficiency. And I’m confident we are in a very good position to further evolve under our new ownership.”
Thierry Derez, chairman and CEO of Covéa, said: “This acquisition project comes at a time when the insurance sector is undergoing fundamental transformation, with emergence of new risks and new lifestyles, and increasing new participants entering insurance markets. It perfectly fits our growth strategy, our ability to adapt, the necessary complementarity of expertises and the importance of risks mutualization on a global basis. It would consolidate the future of PartnerRe and our mutual Group, serving the interests of our members and clients, as well as of our employees and partners.”
Peter O’Neill promoted to UK head of downstream and power at AXA XL
AXA XL insurance announced the promotion of Peter O’Neill to UK head of downstream and power succeeding Peter Welton, who was promoted to UK head of energy in October 2019.
In his new role, he will manage all aspects of the underwriting operations in the UK for downstream energy and power, ensuring strategic profitable growth and the development of the business.
O’Neill joined AXA XL as an energy underwriter in June 2014 and prior to that he worked at AON in 2010 where he was selected for the company’s Impact Programme.
Welton, UK head of energy at AXA XL, commented: “I am delighted that Peter will be taking on this role and have every confidence that his high level of technical expertise and knowledge will further strengthen our UK Energy business. His promotion is also a testament to the depth of talent we have here at AXA XL.”
Everest Re Bermuda appoints Chris Downey to take over as CEO
Everest Re group announced Chris Downey will be appointed as managing director and CEO of Everest Reinsurance (Bermuda) Ltd, succeeding Sanjoy Mukherjee who will return to his full-time duties as general counsel and corporate secretary of Everest Re, effective 1 April 2020.
Mukherjee initially joined Everest in 2000 and became executive vice president, general counsel and corporate secretary in 2005 before taking on the additional roles of managing director and CEO in 2016.
Whilst assuming his additional responsibilities, Downey will continue his current role as chief underwriting officer of the reinsurance division at Everest. Mukherjee and Downey will work closely together over the next few months to ensure a smooth transition.
Juan C. Andrade, president and CEO, Everest Re Group, Ltd. said: "Given the growth and diversification of our Company, particularly in insurance and international, Everest will benefit from Sanjoy’s full time focus as our General Counsel helping the organization deal with the vast complexities of our global operation. He is an outstanding general counsel and his strong leadership, wide market knowledge, and deep industry relationships have contributed, over many years, to the success we have had in building and expanding Everest’s global position as a recognized industry leader. Over the last four years Sanjoy has been instrumental in expanding our Bermuda operations. With twenty years at Everest, his vast contributions to the organization across many fronts cannot be understated.”
Adding: “Chris is a respected underwriter, and leader within Everest, who has previously spent 15 years of his career based in Bermuda. He is a talented and seasoned industry leader who will continue to play an increasingly important role in the future of Everest."
Fidelis names Michael Davern as senior underwriter
Bermuda (re)insurance company Fidelis Insurance Holdings has appointed Michael Davern as senior underwriter for Fidelis Underwriting Limited.
In his new role he will lead the growth of the firms Direct and Facultative (D&F) writings based in the London office, while also working closely with the Bermuda team.
Davern joins Fidelis from AXA Xl where he served for more than 10 years, most recently as an underwriting manager writing open market and delegated authority business.
Richard Coulson, UK CUO & executive head of bespoke & specialty at Fidelis commented: “I am delighted to welcome Michael as Fidelis continues to build its Specialty capabilities. D&F is an area where significant capacity has been removed from the market allowing a pricing correction and creating a strong demand for new participants. We are very focused on being responsive to brokers and clients and believe Michael is the right person to lead the continued growth of this product line for us.”
Richard Holden, executive head of reinsurance said: “We feel this is the right time to enter the Direct and Facultative market, utilising Bermuda and London brokers to access business. Michael brings 15 years of industry experience and market relations to Fidelis and we look forward to building another long-term class of business to complement our existing lines within the Fidelis group.”
Davern added: “I am excited to join Fidelis, at a time when Fidelis can offer a solution for brokers’ and clients’ need for capacity. Given their reputation for client service and that they have a true underwriting philosophy at their core I look forward to growing the Direct & Facultative property book and contributing to Fidelis’ ongoing success.”
AXA XL expands underwriting team in France
AXA XL insurance, a division of AXA has announced the appointment of Stéphane Vauterin as underwriting manager, International Financial Lines for France, based in Paris.
Vauterin brings more than 2 decades of insurance experience and joins AXA XL from Zurich where he held numerous financial services and underwriting positions.
Julien Guénot, country leader, France at AXA XL Insurance, commented: “As a major provider of financial lines insurance globally, we support our French clients with a full suite of specialised solutions from Directors and Officers insurance to Mergers and Acquisitions and Cyber.”
Adding: “The recent increase in Directors and Officers claims, particularly in the large corporate segment, led to tension in that market. French clients and their brokers are, as a result, turning to insurers to help them navigate these developments.”
Simona Fumagalli, underwriting manager, International Financial Lines – Europe at AXA XL, said: “Directors and officers of international companies face heightened risks as claims against them have spiked, driven by a combination of regulatory activity, third-party litigation funding, collective redress action in European Union, #MeToo and recessionary threat. I am delighted that Stéphane has joined the team; he will play a key role in helping our clients navigate those evolving risks.”
AIG adds John Hancock as CEO, International General Insurance
AIG announced John Hancock has been appointed CEO of International General Insurance, effective Spring 2020.
In his new role he will lead the international operations of AIG’s General Insurance business and will report to Peter Zaffino, president and global chief operations, AIG and CEO of General Insurance. Hancock will also serve on the General Insurance Executive Leadership team.
Hancock will be joining the business from Lloyd’s of London where he worked since 2016 as director of performance management, tasked with the responsibility for overseeing performance and risk management globally across the Lloyd’s market.
Prior to Lloyd’s of London, Hancock served at RSA for 26 years in numerous roles of increasing responsibility, including managing director, UK commercial and global broker relationship director. Additionally, he has also served as RSA’s CEO for Asia, Middle East and Africa and held chief underwriter and risk roles in both developed and emerging markets.
Commenting on the appointment, Zaffino said: “Jon is a seasoned executive and industry leader recognized for his track record of underwriting excellence and delivering strong financial results. Jon’s deep technical expertise and significant international operating experience ideally qualify him for this important leadership role.”
Hancock said: “I am pleased to join AIG as the company continues its remarkable progress towards being a top performing company. I look forward to working with AIG’s talented colleagues around the world to enhance the value we deliver to clients as we position the company for sustained profitable growth.”