Round-up of the latest news and developments from the global insurance market with stories regarding, Aon Risk Solutions, Ogden changes, Placing Platform Ltd and more
Aon Risk Solutions name Julia Page as CEO
Aon have named Julie Page as chief executive officer of Aon Risk Solutions (ARS) in the UK. Page will take over from Andrew Tunnicliffe, who has been with Aon for over 10 years; Tunnicliffe will continue to serve ARS UK and EMEA on a part-time basis. John Cullen, CEO, Aon Risk Solutions EMEA said, "This appointment reflects Aon's strategy of promoting and developing internal talent, which is a critical aspect of the firm's growth strategy. Julie's experience and proven leadership ability will enable our Risk Solutions business in the UK to create even greater value for our clients. At the same time clients will continue to benefit from Andrew's experience as he stays with the firm to focus on client facing work. We would like thank him for his contribution as CEO of ARS UK." Page said of her new position, "Since re-joining Aon, I have been impressed by the depth and breadth of client solutions and resources, as well as the quality of both leadership and colleagues. I am delighted and extremely proud to take on the role of CEO for ARS UK and am looking forward to leading the business as we continue to innovate on behalf of clients."
Ogden changes could increase rates on wider casualty lines
The Ogden rate cut could spark rate increases in wider casualty lines of over 20% in some cases. The renewals on 1 July could be telling with reinsurers needing to boost optimism and cover increased claims costs. A prolonged period of competitive pricing could see those already writing UK EL and public liability lines increase prices. It has been reported that Swiss Re, Munich Re, Everest Re and select Lloyd's carriers would be tempted by this move, although market conditions will still have some impact in the amount prices will rise. The primary UK EL and public liability market is dominated by large composite players, such as Aviva, RSA, Zurich, Allianz and QBE. However it is thought UK EL writers from Lloyd’s will be hit hardest as the margins are so thin any sizeable loss would push a reinsurer to reconsider writing that type of structure at renewal.
Placing Platform Ltd has begun taking marine business
Placing Platform Ltd, the digital insurance exchange, has begun taking marine business putting to bed rumours it would have to delay the role out due to a revolt in the market. An alliance of marine underwriters complained in January that the new platform would not be fit for purpose. PPL now has over 950 brokers and underwriters with the inclusion of the marine market who were the toughest to bring on board. PPL said that because it had got the support of the marine market it was now on track for its March timetable. PPL chairman David Ledger said, "Market adoption across the existing lines of business is growing and, as the platform gains more users and improvements come on line, so we are seeing market confidence increase. We are making a number of upgrades to the platform as well as enhancements to functionality and usability. The marine market represents the historic roots of the London market, and we are delighted that this significant class of business has joined the PPL community."
Brokers must adopt automation: UK broker summit 2017
A key takeaway from the 2017 UK broker summit was the encouragement of Brokers to leverage opportunities in automation and press software houses to gain benefits from it. Automation and new development was picked out as an area that had changed pace. Craig Beattie senior analyst at Celent said, “The insurance industry can still leverage automation... and there is still opportunity within the broker community for it to be used to help improve work flows, said Beattie. But there comes a time when you can't automate anymore and it takes a human to do something. If you are interested in artificial intelligence I would press you to look at automation. Beattie further noted that ecosystem and data were not expensive areas for brokers to engage in, adding that firms do not have to be big to make a difference in these areas. The final three trends were connectivity, sharing economy and smart automation, which uses the brain. These are the seven key trends that are really driving change in the insurance industry and these are very accessible for brokers to tap into with the right partners. "There are lots of opportunities in automation and software houses should be doing more."
UK leaders of Integro step down
The UK leaders of Integro, John Sutton and Toby Humphreys, are to step down after leading the broker for more than 10 years. Integro said in a statement that the roles would be filled by the UK management team consisting of co-heads of wholesale Jason Collins and David Abraham, head of retail Bob Pybus and head of entertainment and sport Neil Clayton. Integro went on to say that its UK operation has grown to over 500 employees and generated $120mn in revenue under the leadership of Sutton and Humphreys. CEO Bill Goldstein said, "Our leadership structure is consistent with the firm's growth and focus on specialty areas. It provides a close connection to the firm's clients by design."
50% rate rise for motor reinsurers post Ogden
Excess of loss (XoL) motor reinsurers are expecting a £5bn loss from changes to the Ogden rate and are considering rate rises of up to 50% to quickly make up any loses. The Ogden rate was cut by 3.25 percentage points, higher than the market expected, which could create a much harder market in many lines following a prolonged softening of the market. It has been reported that many expect reinsurers to take between 70% and 80% of the cost of the change in the Ogden rate leading the reinsurance market to heavy losses. Some have already told the market what they expect to lose due to the changes, Novae is forecasting a £55mn impact, XL Catlin $75mn and Axis $50mn. How far the market can push rate increases at renewal remains to be seen with one senior motor executive saying they would be aiming for a 50% increase but can’t accept any lower than a 20% rate increase. It has been reported that many are looking for a 30% to 50% increase with analysts thinking this would be conceivable. Analysts have also said they expect an increase in the number of entrants to the market with many exploiting the post Ogden rate increases; this will make the market more competitive.
Martin Eyres has been appointed underwriting director at Barbican
The UK division of Barbican Insurance Group, Barbican Protect, have named Martin Eyres as underwriting director. Eyres will report to managing director Stuart Kilpatrick who said, "There are very few people in the insurance market today that have a greater understanding of the UK property and casualty market than Martin. During his lengthy career, he has consistently demonstrated his ability to deliver exceptional growth through developing high-quality, profitable portfolios built around the specific needs of the client. His leadership skills, market standing, underwriting acumen and eye for product potential make him a fantastic addition to the Barbican Protect team." Eyres previously served as underwriting manager at Mitsui Sumitomo, where he headed the UK and Ireland property strategic business unit for Syndicate 3210 and was head of their UK and Ireland regional property and casualty business. Eyres said of his appointment, "Barbican Protect has succeeded in becoming a trusted partner to its brokers and their clients in the UK insurance market, built on its reputation for high quality products and first-rate delivery.”
Market discusses AIG CEO replacement
With increasing questions over the leadership of Peter Hancock the market has begun discussing who might be his replacement. Questions were raised over Hancock’s leadership following poor quarterly results that have dampened AIGs two year plan at turning the company around. Some have speculated that if a replacement is sought it will be an outsider with no connections to the company who will be best placed to steer the ship around. Leading industry names that have been circulated are Marsh & McLennan Companies CEO Dan Glaser, Hamilton Insurance Group CEO, AIG veteran Brian Duperreault and Aon CEO Greg Case. Meanwhile, XL Group CEO Mike McGavick may also be seen as a potential candidate after turning the Bermudian around from its own financial crisis woes. The role has been championed as a career defining move but also one with large challenges as another overhaul will be needed to turn the company around, its second in as many years.
CFC increases limits across transaction liability product suite
CFC announced that it has increased the available limits of its transaction liability insurance product suite across all territories. CFC now has the capacity to offer limits up to £30 million in the UK and €35 million in Euro zone countries. Matthew Giddings, transaction liability practice leader, said, “Transaction liability insurance continues to gain traction with an increasing proportion of M&A deals using this type of cover as both a risk management and deal facilitation tool. CFC’s Transaction Liability practice has enjoyed a strong first trading period. Our focus on service, the experience of our underwriters and our ability to leverage other CFC specialisms such as cyber, intellectual property and product recall make us an attractive market. The increase in our capacity is an endorsement of our proposition in this fast-growing and competitive sector. We’re positive about the future and look forward to building on the success of our first year throughout 2017.”