Round-up of the latest news and developments with stories from Pool Re, Placing Platform Limited, Berkshire Hathaway and more
Pool Re says the insurance sectors definition of terror is outdated
Pool Re has said that the current definition of a terrorist attack used by insurers is outdated and needed to be revised. Julian Enoizi, CEO at Pool Re, raised the issue that in the case of some recent attacks participants were not members of any know organisation and as such don’t match the definitions of terrorism by many insurers. Enoizi said, "A lot of these guys are 'inspired by' and they are not a member of a terrorist organisation. The more this goes on the more there will be a look at what the difference is between terrorism and violent religious extremism. There's an argument we should reconsider the definition of terrorism."
Marine underwriter’s revolt leads PPL to make software changes
Placing Platform Limited (PPL) experienced a revolt by a group of marine underwriters who refused to use its insurance exchange software in its current form. This has led them to review the current system and implement changes. Marine underwriters raised concerns that the new system was not fit for purpose after testing the new electronic placing platform which was due to be rolled out by the end of March. The decision was taken to return to the drawing board rather than force the sector to adopt the new format. The new system was meant to iron out current concerns like underwriters taking on more risk than they are meant to on a slip, transparency over which underwriters are on a deal and data integration.
Berkshire Hathaway Specialty Insurance opens London office
Berkshire Hathaway Specialty Insurance Company (BHSI), in coordination with its affiliate Berkshire Hathaway International Insurance Limited (BHIIL), has established a new office in London and filled key executive roles, naming Richard Nathan as head of property lines, Patrick Brown as head of executive & professional liability and Andrew Walker as head of claims, for BHSI in the UK and Southern Europe. “We are pleased to expand our specialty insurance operations with a new London office and a growing team of professionals with excellent capabilities and character,” said Tom Bolt, president, UK and Southern Europe, BHSI. “Richard and Patrick will deliver bespoke specialty solutions backed by financial strength, while Andrew will ensure that excellent in-house claims expertise is available for customers from day one.” The new office will serve brokers and customers in the UK and Southern European countries, including Ireland, Spain, France and Italy. Richard Nathan brings nearly 25 years of industry experience to BHSI. He was most recently corporate property manager, UK & Europe, at Allied World, underwriting on both Lloyd’s and company market platforms. Prior to that he was head of corporate property at Mitsui Sumitomo at Lloyd’s and underwriter, property & packages, at Chubb Insurance Company of Europe
Dual has renewed the cornerstone capacity on its £300mn financial lines binder
With an unchanged panel, Dual has renewed its capacity on its international financial lines binder worth £300mn. It has been reported that the seven biggest capacity providers had all put down lines for another year on the deal. Those that have renewed are, Allianz, Arch, Chubb, CNA Hardy, Everest Re, Liberty and Tokio Millennium Re. The binder covers Duals UK, European and Asia Pacific financial lines book and is the biggest in the London market. The deal was brought together by Guy Carpenter and represents 50% of Duals global premiums managed and two thirds of its international volumes. It is understood that a number of issues affected the binder last year but providers were happy to renew after the binder remained profitable and the commitment of Dual to invest in system upgrades.
Sompo Canopius hires trade credit underwriters
Will Clark and Scott Morrison have joined Sompo Canopius as trade credit underwriters marking the insurer’s expansion into trade credit. Clark previously served as head of UK trade credit at AIG having joined from Santander in 2011. Acting as deputy is Morrison who also joins from AIG where he served as head of supply chain finance. It has been reported that Sompo Canopius is looking to recruit three more underwriters to compliment Clark and Morrison. The pair will both report to Bernie de Haldevang, head of specialty at Sompo Canopius.
A decision by Lloyd’s to open a post Brexit subsidiary has not been reached
Lloyd’s franchise board and council meetings were held on the details of a post Brexit subsidiary, the location of which have yet to be agreed upon. It has been reported that the shortlist still stands at the five put forward at the start of the year. It was initially stated that the meeting would yield an outcome with hopes the shortlist of five would be taken down to two. Lloyd’s has made a public commitment it would have a decision for the market by the end of March. The five geographies still on the list are, Belgium, Germany, Luxembourg, the Netherlands and Ireland. It has been said that Lloyd’s would only consider Germany as a location if it decides to make a play on the continent to build a Lloyd's Asia-style underwriting hub. Luxembourg and the Netherlands may still be suitable contenders should Lloyd’s decide that they want to avoid losing pass porting with minimum cost and effort.
Validus earmarks $25mn or capital for InsurTech ventures
Validus has put $25mn aside to invest in InsurTech ventures which will be invested into the Aquiline LLC fund. Speaking about the decision to invest in the Aquiline fund chairman and chief executive officer at Validus, Ed Noonan, said that they had a good track record in this market and that if they were to set one up themselves it would take a venture capital expert that wasn’t in their current skill set. Aquiline is able to provide InsurTech venture capital staff and will be able to dissect each deal as it is made. A number of companies are following the lead of Axa and Munich Re in investing in InsurTech due to the opportunities that are available in the space.
Trump to order review of Dodd-Frank
Donald Trump will ask for a sweeping review of the Dodd-Frank Act rules established in response to the financial crisis in 2008. Signing an executive action Trump wants to significantly scale back the regulatory system put in place in 2010. Trump will also halt another of former President Barack Obama’s regulations, hated by the financial industry, that requires advisers on retirement accounts to work in the best interests of their clients. Trump’s order will give the new administration time to review the change, known as the fiduciary rule. The actions are thought to represent the new administration’s approach to financial markets, with an emphasis on removing regulatory burdens and opening up investor options. The orders are the most wide reaching steps yet to loosen regulations in the financial services industry and come after he has sought to stock his administration with veterans of the industry in key positions. His plans are sure to face fierce criticism by Democrats who charge that Trump is intent on undoing changes designed to protect everything from average investors to the global banking system.
Fusion launches cyber product
Fusion Insurance has launched a cyber and data protection product which will be available to brokers through the MGA's ten trading offices. Fusion advised that the product is aimed at a wide range of commercial businesses and has a broad insuring clause, clear policy language and a range of limits from £100,000 to £5m. The MGA noted in a statement that data breach, business interruption, cyber extortion, third party privacy protection and hacker damage are included in the standard cover, with an option to extend cover for cybercrime and phone hacking. It is available as a standalone product or in conjunction with other financial lines products which will be launched in the coming months. Fusion also said that its claims service includes assistance from experts in breach forensics, extortion and hacker response. Capacity for the product is provided by Hiscox. Commercial lines underwriting chief executive David Bruce said, "As the UK's largest MGA, we at Fusion are delighted to develop our product suite to meet the evolving needs of businesses across the UK. Cyber threats are a growing concern for SMEs as more businesses trade online, hold customer data and use physical equipment connected to a network. When a cyber breach does occur, businesses need support that stretches far beyond financial compensation, and we are proud of the robust panel of experts that will help minimise the damage and get businesses back on their feet as soon as possible."