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every wednesday • Issue 25 • 17 DECember 2014
FCA review criticises strategy
after pensions debacle
Four top executives at the Financial Conduct Authority (FCA) are to lose their bonuses after a
highly critical report on the way the supervisor released sensitive information to the media.
An independent report by
Simon Davis of Clifford Chance
costing over £3m found that the
FCA’s strategy was “high-risk,
poorly supervised and inadequately controlled”.
A story given to the Daily
Telegraph paper in March this
year said that the FCA was
planning an investigation of 30
million pension policies, some
of which had been sold as long
ago as the 1970s.
Billions of pounds were
wiped off the share prices of big
insurance companies because
investors feared that a PPI type
scandal was about to break.
The FCA was forced to calm
the markets by clarifying that
it did not intend to carry out an
The report into the FCA’s
conduct said the FCA had not
addressed the issue of whether
the information given out might
be price sensitive.
John Griffith-Jones (pictured),
the FCA’s chairman, said in
a statement: “The board fully
accepts Mr Davis’ criticisms,
and on behalf of the FCA, we
apologise for the mistakes that
were made.”
Chief executive Martin
Wheatley, Clive Adamson,
the head of supervision, Zitah
McMillan, the director of communications and David Lawton,
director of markets will not
receive bonuses for 2013/14.
Five other senior staff members
of the FCA will take a 25% cut
in their bonuses.
Earlier this week it was announced that Adamson along
with McMillan and Victoria
Raffe, a member of the executive committee, would leave the
FCA. n
John Griffith-Jones
Aviation exposure to exceed $1trn by 2020
The aviation insurance industry has faced a more than 50% increase in
exposure since the start of the century and can expect the overall figure to
pass the $1trn mark by the end of this decade, a new report has found.
The year 2000 saw the insurance industry’s exposure to
aviation losses stand at $576bn,
a figure which had increased to
$896bn at the beginning of this
year. If the industry continues
to expand both its airline fleet
and the number of passengers
it expects to carry, then the
insurance industry can expect
its exposure to potential aviation
claims to surpass the $1trn mark
for the first time by 2020, if not
sooner, Allianz Global Corporate & Specialty (AGCS) noted
in its Global Aviation Safety
That should not necessarily
cause insurers too much concern
however, as major advances in
technology and the industry’s
overall improved safety record
means that, prior to 2014,
aviation premiums were at the
lowest they had been for many
years. The losses to have hit the
market this year have obviously
changed that dynamic somewhat, but even then, few expect
Continued on page 5 >
ALSO in this issue: Bank of England and PRA aware of banking and insurance difference, argues Bailey page 11
2 EDITORIAL comment
17people moves
• FDI will
increase India’s
• Analysis: Why Tria
authorisation failed in
the Senate
• Asia-Pac credit cycle
may be turning soft
• The Retrocession
Question: Should
reinsurers cash in
on low rates?
Towergate’s CFR to
• Canopius hires
and subsidiary
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FDI will increase India’s attractiveness
Head of Marketing
Helen Cherry
Tel: +44 (0)20 779 6475
Email: [email protected]
The Indian insurance market’s
attractiveness to outside investment
may increase significantly this week
should a Bill be passed that increases
the level of foreign direct investment
(FDI) allowed in the country’s
For the past 14 years, foreign
insurers have only been able to hold a
maximum 26% stake in local carriers.
That has proven highly frustrating
for international insurers, many of
whom view India as having significant
potential for growth. It is little surprise
then that insurers are keen for the
Indian Insurance Amendment Bill to be
passed as it will allow the level of FDI
to increase to 49%.
The last 14 years have been a struggle
for those insurers looking to gain a
foothold in India, but the current Bill
has the backing of both the leading
party in the governing coalition and the
largest party in the opposition – BJP
and Congress respectively, although
that these two groups both support the
proposal does not necessarily mean it
will be passed without any difficulties.
Even if the Bill does not pass
smoothly, the last month has seen
companies and organisations move
to the country in order to develop a
presence in the market.
JLT became the latest broker to
open up in the country, launching JLT
Independent Insurance Brokers as a
joint venture alongside Chennai-based
insurance brokerage Sunidhi Group.
Under India’s current laws, JLT’s stake
stands at 26%, although it admitted it
would raise its share if the opportunity
Depending on what happens this
week, the chance to do that may be
sooner rather than later. n
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17 december 2014
top stories
RGA restructures organisation
Reinsurance Group of America (RGA) has completed an organisational
restructure to divide its global structure into four distinct groups.
Each of the newly announced organisations
will be responsible for a particular operating function and will report directly to
RGA’s president and chief executive, Greig
However, RGA noted that the current financial reporting and geographic segments
will not change.
“Our organisation continues to grow
in size and reach,” said Woodring. “As
the business and regulatory environments
in this industry evolve, so do our clients’
“I expect that this new structure will
sustain and strengthen our unique culture of
strong client focus and innovation.”
RGA said that Alain Néemeh, senior
executive vice president of global life
and health markets, will assume responsibility for RGA’s core traditional life
and health business worldwide.
Anna Manning, senior executive vice
president of global structured solutions, will
take over responsibility for transactional
business, including RGA’s global financial
solutions and global acquisitions units.
Donna Kinnaird, senior executive vice
president and chief operating officer, will
lead the company’s corporate initiatives
division aimed at new expansion opportunities. She also remains responsible for the
company’s corporate services and global
accounts, said RGA. n
Aviation exposure to exceed $1trn by 2020
< Continued from page 1
this trend of numerous catastrophic losses
to continue into 2015.
As AGCS noted in its report, “this year’s
aviation losses contradict [the] long-term
trend of fewer than two passenger deaths
for every 100 million commercial passengers”.
The number of catastrophic losses to
befall the market has reduced significantly
in recent decades, although as the AGCS
report highlights, plane crashes remain the
biggest cause of loss to the sector. In terms
of claims, crashes account for 23% of the
total number of losses filed and 37% of the
overall value.
Over and undershot runway incidents
sit at number two on the list according
to value. Aside from crashes and runway
incidents, a fifth of aviation claims relate
to ground handling incidents, and another
16% relate to mechanical failure.
Three of the largest non-natural catastrophe losses to hit insurers in 2014 can be attributed to aircraft claims. But these claims
do not reflect an industry that has a major
problem with safety, as AGCS explained.
“This year’s loss activity is contrary to
the low catastrophe rate of recent years
with 2012 ranked as the safest year of
flying since the beginning of the jet age in
In fact, two of the major three losses to
hit the airline insurance market this year
relate to war events, while the cause of the
third – the mysterious plight of Malaysia
| 17 december 2014
Airlines flight MH370 – remains unknown.
In conducting the report, AGCS found
that the everyday, or attritional costs, are
increasing both in number and in value.
That these claims are on the rise is to
be expected what with the ever growing
number of flights being taken around the
world. However, what is causing insurers
some concern is the cost of these everyday
losses increasing.
That situation is made worse by the latest generation of aircraft, many of which
are made utilising composite materials.
This makes the aircraft lighter and more
durable, but repairs can be more time consuming and may cost greater sums.
“Composite repairs require the relevant
expert technicians, often in limited supply,” explained AGCS.
“As a result, new generation aircraft take
more time to assess damage and repair,
leading to more down time and more
expense. At the same time, the cost of
repairing older aircraft is also increasing.
Ageing fleets are more expensive to repair
as the availability of parts becomes more
Furthermore, the increasing complexity of modern aircraft design means both
manufacturers and maintenance, repair
and overhaul (MRO) teams are keeping
fewer spare parts on site. On top of this,
the expansion of the composite structured
airliner industry means several kinds of
new parts are not always kept on site as
they are only made to order.
As AGCS points out though, the use of
MRO companies themselves is becoming
something of a topical issue when it comes
to aviation claims.
“MROs require the consent of manufacturers before carrying out repairs but
manufacturers increasingly prefer to carry
out repairs themselves. For major claims
it may be appropriate to go with the
manufacturer because they are more likely
to have the required spares in stock and
can work faster. But for standard claims
it could be more cost-effective to use an
However, insurers are unable to influence the manufacturer’s decision on
whether to use an MRO which can, in
some cases, result in a more expensive
New regulation is also adding to the
potential costs facing insurers.
These new rules dictate that manufacturers and MRO firms cannot use the same
approved technician to carry out both
the repair and the inspections, a situation
which leads to increased costs. n
top stories
Analysis: Why Tria
authorisation failed
in the Senate
On December 16 the US Senate went home for the year without
extending the Terrorism Risk Insurance Act (Tria) and the blame
game has already begun, writes Sam Kerr.
The Terrorism Risk Insurance Act (Tria)
will expire at the end of the year following
the failure of the US Senate to reauthorise
the programme before the holidays
It had previously passed extension bill
S.2244 by 94 votes to four, but failed to get
an amended version of that bill, passed by
the House of Representatives last week, to
the floor of the chamber.
The reasons behind this are mired in
party politics and the arcane parliamentary
procedure of the upper house of the US
The version of Tria renewal passed by
the House also contained additional provisions to amend the Dodd-Frank Act and
to create a national network of agents and
brokers which could sell across state lines
Both these provisions were a source of
disagreement between the Senate and the
Senator Tom Coburn (R-OK) opposed
NARAB II because of the threat it potentially poses to states controlling their
internal insurance markets.
Coburn placed a hold on the Tria extension bill last week following a vote in the
House which backed Tria’s renewal with an
overwhelming bi-partisan majority of 417
to seven.
The Senate’s rules allow any member to
place a hold on a bill to prevent it to getting
to the floor of the chamber.
Senate leadership continuously rejected
Coburn’s appeals for change of the NARAB
II provision, and he therefore did not lift his
hold and the vote never came to the floor.
The Senate’s Democratic leadership
had another option to bring the bill to a
vote under the cloture rule, but such a vote
would require a majority of 60 in the 100
seat chamber and would limit all debate to
30 hours.
Senate Democrats also disagreed with
the other addition made by the House to
“The vast majority of Senate and
House members strongly supported
extending this program. But it will
not be extended, because Tea Party
politicians, who lack the will or ability
to compromise, stood in the way”
– Rep. Carolyn Maloney (D-NY)
the bill which contained amendments to the
Dodd-Frank Act.
The House bill contained an insurance
fix to the Dodd-Frank Act which would
lessen capital requirements for insurers.
Senate Democrats did not object to this,
but they were against other changes to
the Act championed by House Financial
Services Committee Jeb Hensarling (RTX) which would lessen financial restrictions for non-financial institutions such as
smaller businesses.
Democrats objected to such sweeping
changes to Act, with talk that Senate Democrats would reject the bill because of them
even before Coburn put his hold on Tria.
Hensarling had previously been in negotiations with Senator Charles Schumer
(D-NY) over a Tria compromise, and had
previously wanted to reduce the programme.
Reactions was told last week that he had
relented on the details of the terrorism programme, agreeing to the Senate bill that had
been championed by Schumer, but wanted
the Dodd-Frank changes as a compromise.
Despite getting the Tria he wanted,
Schumer was unwilling to compromise over
Senate Democrats were presented with
a potentially difficult political situation as
every single one of their colleagues in the
House had voted for the bill with the DoddFrank addition.
Coburn’s hold meant the Senate’s Democratic leadership, led mainly by Schumer
and Senator Elizabeth Warren (D-MA),
didn’t have to actively vote against the bill.
However, by not actively trying to overrule Coburn’s vote through a cloture motion,
Senate leadership could kill the bill without
having to vote against it.
Democrats have predominantly blamed
Republicans for placing unrelated, unpopular riders onto a popular programme which
eventually killed it.
“The vast majority of Senate and House
members strongly supported extending
this program. But it will not be extended,
because Tea Party politicians, who lack the
will or ability to compromise, stood in the
way,” said Rep. Carolyn Maloney (D-NY).
“Their obstructionism will reap negative economic consequences on businesses
throughout our country.”
“From the very beginning, I believed a
clean Tria bill, lacking unnecessary and
unproductive riders, was the best strategy.
“I hope that the House and Senate will
make this legislation a top priority in the
new Congress, and will quickly pass a longterm reauthorisation of this vital program in
However as Republicans will control
both the House and the Senate from January onwards, a clean reauthorisation is
The bill that failed in the Senate is likely
to be the bill that will be sent to them
again in January if the programme is to be
renewed and Coburn has now retired from
the Senate so his hold will no longer be an
issue in the New Year.
Republicans in the House have said since
last week’s vote that changes to DoddFrank in the extension bill were minimal
and it was the Senate’s responsibility to
pass a bill which had been passed with a
large bi-partisan majority in the House. n
17 december 2014
top stories
Opinion divided over Lima
climate deal success
of major new climate disasters at present,
means that the world will put off meaningful action for some years, even beyond Paris
2015,” he said.” Unfortunately, that means
that there will be some serious disasters in
the coming decades, and the lack of a risksharing mechanism will place the burden
on the poorest countries and segments of
A sticking point in the Lima talks was
how to spread the burden of pledges to cut
carbon emissions between rich and poor
countries. Developing countries had refused
to sign up to the pact accusing rich countries
of not helping them to cut emissions.
But talks ended in a compromise that
many believe could help the UN reach a new
global treaty by the end of next year.
As well as pledges and finance, the agreement should lead to a new classification of
nations. Rather than being divided into rich
and poor, the text attempts to reflect a more
complex world, where the bulk of emissions
originate in developing countries.
The agreement restored a promise to
poorer countries that a “loss and damage”
scheme would be established to help them
cope with the financial implications of rising
However, it weakened language on
national pledges, saying countries “may”
instead of “shall” include quantifiable
information showing how they intend to
meet their emissions targets, according to
the BBC.
Under the deal agreed in Lima, national
pledges will be added up in a report by
November 1, 2015, to assess their aggregate
effect in slowing rising temperatures. However, after opposition led by China, there
will not be a full-blown review to compare
each nation's level of ambition.
Environmental groups said the proposals
were nowhere need drastic enough. Sam
Smith, chief of climate policy for the environmental group WWF, told reporters that
successive drafts watered down demands
on participants: “The text went from weak
to weaker to weakest and it's very weak
Jagoda Munic, chairperson of Friends of
the Earth International, added that fears the
talks would fail to deliver a fair and ambitious outcome had been proven “tragically
Andrew Dlugolecki is deeply pessimistic
about the future of climate discussions.
“These negotiations always drift until the
crunch comes - which is in Paris for this
phase,” he told Reactions. “But there is
always a next phase i.e. post-Paris, so I
doubt if anything major will emerge even
then.” n
based investor £100,000 in the first instance,
with BP Marsh also providing Bastion with loan
funding of £212,000. Subject to certain conditions, BP Marsh may provide additional loan funding of up to £130,000.
BP Marsh believes the investment will give it an
opportunity to cement a foothold in South Africa’s
reinsurance industry, a country whose re/insurance market is increasing its exposure to London.
Bastion was launched in May 2013 by Ian
Snowball, the broker’s chairman, and Lance
Brogden, who serves as chief executive. As part
of the deal, BP Marsh’s Dan Topping will join Bastion’s board as the investor’s nominee director.
An agreement on how countries should tackle climate
change has been reached by United Nations members
meeting in Lima.
After over running by two days, delegates
from 194 countries finally approved a
framework for setting national pledges to be
submitted to a summit in Paris next year.
Opinion was divided over whether any
meaningful action was agreed, with environmental groups criticising the deal as an
ineffectual compromise. The EU said it was
an important step towards achieving a global
climate deal at the so-called COP 21 summit
in Paris.
Dr Andrew Dlugolecki, insurance industry
veteran and a chief author on financial
services for the Intergovernmental Panel on
Climate Change, told Reactions that the potential emissions targets indicated by Lima
are inadequate to prevent major climate
“The current economic crisis, which
seems to be deepening, plus the relative lack
News in brief
BP Marsh invests in
South Africa broker
BP Marsh & Partners is looking to gain a foothold
in the expanding South African reinsurance
market after taking a 35% stake in Bastion Reinsurance Brokerage (PTY) Ltd.
The initial investment has cost the London-
| 17 december 2014
top stories
Final stretch for
India Insurance Bill?
On Tuesday December 16th the Insurance Amendment Bill was
scheduled to come before the Indian Upper House the Rajya
Sabha, possibly bringing to an end 14 years of struggle to increase
the maximum foreign direct investment (FDI) limit in Indian
insurers to 49% from 26%.
For the first time the bill will have the
backing of both the leading party in the
governing coalition and the largest party
in the opposition – BJP and Congress respectively – but this still does not guarantee a smooth passage.
Finance minister Arun Jaitley will
introduce the legislation, with the business
advisory committee likely to allocate four
hours to discuss the matter. The BJP will
hope that the BJD, BSP and AIAMDK
minority parties will either back the bill
or will not oppose it, but the Trinamool
Congress (TMC), SP, JD(U) and all of the
Left parties have maintained their firm
opposition. Together they have about 50
members of the Upper House, and there is
a strong possibility that they will continue
the delaying tactics that they attempted,
but failed to employ effectively, in the select committee set up after the last parliamentary session. JD(U) leader KC Tyagi
stated explicitly that “we will not let the
(Upper) House pass it. We will stall it.”
Even Congress, which eventually supported the bill in committee, has indicated
that it will not rubber-stamp the legislation.
This is at least in part because the party has
its own divisions about whether it should
support a bill which it itself introduced, or
whether, as the leading opposition party, its
paramount duty is to make things difficult
for the government. Part of the reasoning
behind the latter argument is that BJP did
not help Congress push through the Insurance Bill in the last year of the Congressled coalition, and Congress does not want
the BJP to be seen to get all the credit for
finally making the Bill law.
The current rumour is that Congress will
not issue its 69 Upper House members
with any whip requiring them to attend the
vote. The party appears to be attempting to
be the party of consensus, which is leading to concerns that, if the meeting of the
Upper House descends into loud clauseby-clause disputes, Congress might finally
decide to oppose the Bill for yet another
session. n
TSR predicts below norm
hurricane season for 2015
Twenty fifteen is likely to be another year with a below norm hurricane
season, according to London’s Tropical Storm Risk.
Based on current and projected climate
signals, Atlantic basin tropical cyclone activity is forecast to be about 20% below the
1950-2014 long-term norm and about 30%
below the recent 2005-2014 10-year norm.
TSR says its main predictor at this
extended lead (6 months before the 2015
hurricane season starts) is the forecast
July-September trade wind speed over the
Caribbean Sea and tropical North Atlantic.
This parameter influences cyclonic
vorticity (the spinning up of storms) and
vertical wind shear in the main hurricane
track region. At present TSR anticipates
the trade wind predictor will have a small
suppressing effect on activity. As a health
warning, it adds that the precision of TSR’s
December outlooks for upcoming Atlantic
hurricane activity between 1980 and 2014
is low.
In 2014’s hurricane season there were
eight tropical storms, six hurricanes, two
major hurricanes and a wind energy ACE
index of 65. It was the second year in a row
with activity in the lowest tercile (belownorm category); the last two consecutive
below-norm activity years were 1993 and
The US has now gone nine years without
a major hurricane landfall, which is an unprecedented run in hurricane records dating
back to 1851, TSR said.
All forecasts performed well in 2014
- except for the TSR December forecast,
which over-predicted activity. Forecast
precision improved in general with proximity to the hurricane main season start on
August 1. CSU performed best for predicting the ACE index whilst TSR and the
Met Office performed best for predicting
hurricane numbers. All agencies over-predicted tropical storm numbers although the
Institute of Meteorology, Cuba forecasts
were closest overall.
Updated TSR outlooks will be issued on
April 8 2015, May 27 2015, June 5 2015,
July 6 2015 and August 5 2015.
The TSR scientific grouping brings
together meteorologists, climatologists
and statisticians from University College
London and Aon Benfield. n
17 december 2014
top stories
Questions remain about
Allianz’s US business
Further changes are afoot for Allianz’s US operations after the
company announced a host of senior management moves.
The moves form part of Allianz’s decision to
streamline its operations in the US. Allianz
announced in September it was to integrate
the respective commercial property and
casualty businesses of Fireman’s Fund and
AGCS in the US, with these combined units
continuing under the Allianz brand, a transition that will take place over the course of
The new structure sees Art Moossmann,
a member of Allianz Global Corporate &
Specialty’s management board, lead the
combined Fireman’s Fund and AGCS North
America businesses as president and chief
Fireman’s Fund’s legacy business, which
includes asbestos and environmental
exposures, old worker’s compensation and
construction defect liabilities, will all be put
into a new operation called San Francisco
Re which will itself form part of the new
Allianz Group unit called Allianz Runoff
Michael Diekmann, Allianz CEO
While there is little doubt these changes
make sense from Allianz’s point of view,
some questions remain. Firstly, what will
happen to Fireman’s Fund’s personal insurance business. Back in September, rumours
arose suggesting Allianz had appointed
Goldman Sachs to sell this unit, with early
front runners to win the bidding understood
to be Ace, AIG and AmTrust.
As it stands, Allianz remains tight lipped
about its plans for this personal lines business, with the company refusing to answer
questions on the matter. However, in its
announcement on Friday, Allianz admitted it
was still considering its options with regards
to the personal lines business.
The second question surrounds the future
of Andrew Torrance, the former chief executive of Allianz UK, who moved over to the
US as chief executive of Fireman’s Fund in
2013 in the wake of Lori Fouché’s departure.
During his time at Allianz UK, Torrance
managed to turn around what had previously
been something of an underperforming
business. Many in the market speculated he
had been tasked with a similar brief when he
took the reins at Fireman’s Fund.
In its press release detailing the management changes, Allianz said Torrance was
stepping down from his position, although
he “will continue to be available to support
the ongoing review of future options for the
Fireman’s Fund personal insurance business”.
How long this review lasts remains to be
seen, both in terms of what will happen to
the personal lines business as well as Torrance's future at the company. n
EIOPA warns on key risks
to financial stability
The weak macroeconomic climate, prolonged low interest rates and
sovereign credit risk remain the main risk factors for insurers going into
2015, the European Insurance and Occupational Pensions Authority
(EIOPA) warns.
The watchdog says certain asset prices may
not correctly reflect underlying risks and if
there’s a reversal of market perception, asset values could substantially decrease.
In its new report on financial stability in
relation to the (re)insurance and occupational pension fund sectors in the European
Economic Area, EIOPA says overall downside risks have increased. EIOPA’s 2014
stress test, published recently, explored the
risks highlighted in the financial stability
report and concluded that such risks could
have a substantial impact on the insurance
The sector was shown to be particularly
vulnerable to a severe “double hit” scenario
that combined widespread asset price cor-
| 17 december 2014
rections with a decline in risk free interest
Low interest rates are prompting insurers
to review and adapt their business models
and EIOPA has observed insurers reducing
profit shares, setting-up specific reserve
funds or additional technical provisions.
The overall profitability of insurance
companies is still relatively favourable but
results remain pressurised, EIOPA says.
It notes that the global reinsurance sector
continued its robust growth in 2014 with
strong underwriting results and capital
returns, adding that although catastrophe
bond issuance has been high, absolute
volumes remain modest.
According to EIOPA’s qualitative assess-
Gabriel Bernardino, Chairman of EIOPA
ment, in 2015 positive premium growth is
anticipated for non-life insurers only.
The thematic article of the report
analyses and compares several strategies
to measure interconnectedness of financial
institutions. n
top stories
Asia-Pac credit cycle
may be turning soft
The Asia Pacific’s credit cycle may be turning amid soft economic prospects, weak credit
conditions, and a build-up of debt in the region, according to Standard & Poor’s (S&P).
“As we near the end of 2014, credit conditions
in Asia-Pacific appear to be slightly tighter,”
said S&P’s credit analyst, Peter Eastham. “It seems that some investors and lenders
are taking a breath to re-evaluate strategies
amid slower economic growth in key parts of
the region. In our view, this suggests a lessoptimistic view by the market and a possible
turning of the credit cycle.”
S&P’s baseline scenario is for Asia Pacific
gross domestic product (GDP) growth to level
out at 5.3% for both 2015 and 2016, up from
5.1% for 2014. “Despite our sunnier disposition on the
quality of regional growth in the next two
years, the balance of risks remains tilted
toward the downside” – Paul Gruenwald, S&P
chief Economist for the Asia-Pacific
However, China's lower growth trajectory
of around 7% in the near term is likely to
continue to affect business confidence and
investment plans to varying degrees. “Asia-Pacific economies are ending 2014
on a relatively low note, with China's growth
slowing under a weak property market, Japan
slipping into recession, and external demand
yet to meaningfully improve,” said Paul
Gruenwald, S&P chief Economist for the
Asia-Pacific. “Despite our sunnier disposition on the
quality of regional growth in the next two
years, the balance of risks remains tilted
toward the downside,” said Gruenwald.
The build-up of corporate debt over recent
years in the region is also an issue.
When combined with soft economic prospects, S&P said there is a net negative bias for
its pool of issuers in Asia-Pacific.
“We expect this bias to remain steady in
2015,” said S&P credit analyst, Terry Chan. “Cyclical industries such as transportation, building materials, chemicals, real estate
development, and capital goods have higherthan-average negative biases. “The outlook for the region's financial
institutions and public finance entities remains
negative, while the Structured Finance sector
is stable with a negative bias,” Chan said. n
News in brief
Spanish gales kill two
Two people have died in gales in Catalonia,
northeastern Spain, after winds hit the region
at around 120km per hour (75 mph) destroying
roof tops, walls and trees.
A man and a woman died when parts of a
factory wall in Terrassa, Spain, fell on them during the storm on Tuesday, officials have reported.
A rail worker was also injured when a train
partially derailed after hitting a fallen tree on the
tracks perforating the driver’s cabin according to
local reports.
The Catalan government kept the region on
high alert throughout Wednesday despite the
storms easing with residents advised to avoid
vulnerable structures.
Willis Ireland completes IFG buy
Willis Ireland has completed its acquisition
of several Irish pension and financial advisory
businesses from IFG Group. The deal brings
more than 100 people from IFG Ireland pension and financial advisory businesses into
Willis Ireland.
“This is the latest in an exciting series of
acquisitions this year to grow and develop our
human capital and benefits practice globally,” said Tim Wright, Willis International chief
executive officer (CEO), and leader of Willis’s
global human capital and benefits practice.
The Irish market holds a lot of potential and we
see a growing interest among both clients and
prospects in retirement and wealth planning.”
Gary Owens is now managing director of
Willis Ireland’s combined pension and human capital and benefits business, and was
formerly IFG group director and CEO of IFG
17 december 2014
Airline rates starting
to soften, says JLT
The hardening of airline insurance rates that occurred in light of
the major losses to hit the market this year are already softening,
with competition in the sector as hard as it has been for some
That is the opinion of JLT, with the broker
noting that the recent trend of price increases now appears to be softening, although it
added there was a caveat to that statement.
“Perhaps 'softening’ is not the best term
to use since market negotiations are as
hard fought now as they have been for
some time, with each renewal subject to
huge scrutiny in relation to their individual
parameters,” JLT explained in the latest
edition of Plane Talking.
According to the broker, rate increases
are still being applied to some accounts,
although it is on a case by case nature.
Larger accounts are, for example, obtaining
flat or slightly reduced pricing at renewal.
However, JLT said there is little doubt
the average reductions seen earlier in the
year have been mitigated and numbers are
now moving towards neutral for the first
time in 2014.
| 17 december 2014
The broker’s figures only apply to November, which despite being in the midst
of the market’s busy final quarter, are not
quite the barometer as the numbers that
will emanate from December when many
of the world’s largest airlines renew their
insurance programmes.
While it is still early, JLT believes the
year-end numbers for airline renewals
“will likely finish either 'as before’ or at a
minimal increase”.
The premium collected so far this year
by airline insurers is already above that
generated in 2013, with the hull side of the
market receiving $404m, up 1%, and the
liability sector taking $617m, an increase
of 0.4%. Overall, airline insurers have
already generated $1.021bn of airline hull
and liability premium in 2014, up from the
$1.016bn collected in the entirety of 2013.
“The year to date premium has moved
into positive figures for the first time this
year,” said JLT.
“Whilst these numbers may not be as
high as anticipated by some, they will ultimately provide some mild relief to those
loss affected insurers and, due to the 'miss
factor’, may even produce a profit to those
new or unaffected markets.”
At the same time, the numbers do not
necessarily mean rates have increased,
as average fleet values have increased by
around 7.5% and passenger exposure has
risen by approximately 6%.
The lasting impact of the heavy losses
sustained in 2014 may not have much of an
effect on the industry next year either, explained JLT, although there is a chance the
tougher stance taken this year may remain
for some time yet.
“Looking at recent history it would not
be unreasonable to expect that in 2015 we
could see a return to weak market conditions and sizable reductions once again,
however our view is that the measured and
realistic market response we are currently
witnessing may possibly be more sustainable.” n
Bank of England and PRA
aware of banking and insurance
difference, argues Bailey
One of the most senior regulators of the UK’s financial services industry has insisted
the bodies he represents do understand the differences between banks and insurers.
The onset of the financial crisis led to a
period of serious rethinking by regulators
across the world. Solvency II will finally
be imposed on Europe’s re/insurers at the
beginning of 2016 after several false starts.
It has cost those affected by it hundreds
of millions of pounds as they prepare for the
introduction of the wide reaching rules. Indeed, John Nelson, the chairman of Lloyd’s,
has admitted getting the market ready for
Solvency II has already cost those operating
within it something in the region of $500m.
That has obviously caused much consternation within Europe’s re/insurance
industry, and led to many complain that
underwriting entities are being unfairly
punished for the problems that emanated
from the banking industry. While AIG is
an insurer and was one of the most high
profile casualties of the financial crisis, the
problems it encountered were to do with its
non-core insurance operations rather than its
underwriting activities.
But Andrew Bailey, deputy governor for
prudential regulation at the Bank of England
and the chief executive of the Prudential
Regulation Authority (PRA), insisted he and
his colleagues are aware of the differences
between a bank and an insurer.
“We can spot the difference between a
bank and an insurer. There are all sorts of
ways of describing the differences between
a bank and an insurer…Banks provide a set
of critical financial services without which
economies could not function – intermediation of savings [and] provision of payment
services [for example],” Bailey told an audience in Bermuda.
“Likewise, insurers are also provide a set
of critical financial services to economies
which are of course all to do with the management and transfer of risk.”
As Bailey explained, there is therefore
one thing that both banks and insurers have
in common.
“They are responsible for the provision
of financial services upon which we are all
critically dependent. For both of them, this
activity involves bringing customer money
directly onto their balance sheets to provide
these services, and thus creating direct exposure to policyholders, savers and depositers.
“It’s this common element of critical
services that provides, in my view, the thing
that marks out banks and insurers and it
marks out why I think it’s logical as a prudential regulator that we are responsible for
regulating banks and insurers.”
However, Bailey insisted that does not
mean banks and insurers are treated in
exactly the same way.
“[Despite the similarities], I’m very keen
to stress that it does not mean that any regulator in our position should be monolithic in
their view of banks and insurers. That would
be the wrong thing to do.”
The onset of the financial crisis led to
an overhaul of the regulatory system in the
UK, and, as Bailey explained, it has also
prompted a much more rigorous drive to
understand what risks face the financial
Bailey admitted it is of great importance
to fully understand the financial system and
its fault lines much better than it was previously before the financial crisis took hold.
“We should do that work and recognise
that different parts of the financial sector
perform different roles and take different
risks,” he said.
“Understanding those risks does not mean
17 december 2014
| 11
taking a one size fits all approach to regulation.”
On top of that, Bailey said the PRA
should also ensure the same capacities to
differentiate exists for the different benefits
these sectors bring to help stabilise the
financial system and thereby continue to
provide the services they offer.
“Insurance is a critical service without which economies and society would
struggle very badly,” Bailey said, adding:
“That means there should be a focus on
ensuring continuity of cover for those risks
transferred by insurers.”
Bailey added: “Insurance [is] critical for
supporting economies and societies. The
critical nature of the service supports the
case for firm level supervision, promote
safety and soundness and to promote the
protection of policyholders.
“Micro prudential regulation of that sort
should be complemented by, but not substituted by, the use of macro prudential tools
where they’re appropriate.
“Those tools should be used selectively,
and not where the case does not exist. All interventions must be justified by the risks run
by insurers, and not a broader argument that
does not differentiate between insurers and
other forms of financial intermediaries.” n
Andrew Bailey
“We can spot the difference between a bank and an insurer. There are all sorts of
ways of describing the differences between a bank and an insurer…Banks provide
a set of critical financial services without which economies could not function
– intermediation of savings [and] provision of payment services [for example],” –
Andrew Bailey, deputy governor for prudential regulation at the Bank of England and the chief
executive of the Prudential Regulation Authority (PRA)
| 17 december 2014
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The Retrocession Question:
Should reinsurers cash in on low rates?
As retrocession prices follow the reinsurance sector’s downward spiral the market is split over
whether it is better to cash in on low rates or to buy less retrocession to increase profits.
Retrocession buying is currently “completely
counter intuitive” according to Chris Clark
(pictured), deputy chairman of Willis Re, who
argues that reinsurers are buying less than ever.
However, this seems to be a point of contention in the market as Eamonn Flanagan, Shore
Capital analyst, argues reinsurers are being
opportunistic and buying more retrocession as
prices are low.
As the reinsurance markets have been
swayed by insurers retaining more risk and
alternative capacity lowering prices, the
retrocession market seems to be following in
the same direction. William Mills, Beazley’s
head of ceded reinsurance, explains: “Rates
for property retrocession coverage have been
very high since Katrina so the new capacity
entering the market over the last few years has
brought an important competitive dynamic to
what was an underserved market. Rates have
reduced significantly over the past two renewal
seasons and we expect this trend to continue.”
As rates drop the retrocessionaires have no
choice but to go along with it says Clark. He
caveats that with: “unless you are one of those
brave souls like RenRe or Hiscox, and you
say, ‘You know what? There is no margin left
in the business. I won’t write this anymore.’”
Hiscox and RenaissanceRe (RenRe) said
they were exiting some of their under-priced
business in their third quarter results this year.
“Retro prices do mirror the prices of reinsurance and insurance but there is less of it
being brought which is making the prices go
down even more,” added Clarke. Beazley’s
retrocession purchasing is relatively unaffected by such market forces, Mills argues.
“We continue to retain a sensible level of risk
and respond to changes in the reinsurance
market by focusing on management of the
gross portfolio,” he says. However, Beazley
write comparatively little reinsurance business
within the group and its retrocession purchase
is predominantly for Beazley’s property treaty
book which has worldwide cat exposure.
Are reinsurers buying more
Retrocession purchasing does not mirror reinsurance purchasing quite so closely according
to Flanagan. “It is in reverse order. There has
been a definite shift in retro purchasing but I
don’t think it is anything more glorious than
Chris Clark
a willingness to be opportunistic,” he said.
Retrocession rates are coming down, therefore
enabling reinsurers to buy a similar level cover
for a lower price. “I don’t think it is part of a
re-design. If you look at the companies such as
Lancashire’s results commentary that’s what
a lot of these companies have done. They are
protecting their own net exposures to a much
greater degree,” he explains.
Lancashire has reduced exposures across the
board. Alex Maloney, Lancashire’s chief executive officer, says that despite concerns that
pricing had hit a floor, there is still pressure on
pricing and predicted some aggressive renewal
targets. “But we can mitigate the effects of
up-front pricing impacts with very substantial
savings on our own reinsurance and retrocession purchases,” said Maloney.
Amlin reportedly chose to discontinue its
retro special purpose syndicate (SPS) for 2014
completely. Syndicate 6106 wrote a quota
share of Amlin’s Lloyd’s excess-of loss book,
effectively providing retrocession protection.
Amlin’s non-renewal of the £42m capacity
syndicate was reportedly due to anticipated
pricing drops for major cat reinsurance in the
January 1, 2014, renewals. Retro buying is
“counter intuitive”
Despite Lancashire and Amlin’s statements,
Henning Ludolphs, Hannover Re, managing
director and retrocession and ILS division
head, said that despite excess capital bringing
down retrocession expenses where the respective incoming reinsurance business is not
producing as big a margin, reinsurers are not
necessarily buying more. “Retrocession nevertheless comes at a cost because premiums
exceed expected losses. Hence retrocession
protection buying will not increase significantly simply because premiums are coming
down,” he explains.
Clark also says reinsurers are retaining more
risk, as are insurers. “The trouble is when you
have spent all of your reserves and the prices
are going down,” adds Clark. Public companies face pressure to grow net written premiums (NWP) and cutting back on reinsurance
spend is an easy way to achieve this.
“The whole thing is completely counter
intuitive. You would think with retro prices
going down you should buy rather than doing
what reinsurers are doing which is retaining
more,” said Clark. He argues that it will continue until something unthinkable happens – a
disaster scenario like 9/11 – or until companies
start to lose money and walk away.
There has been a marked reduction of companies purchasing parametric products, claims
Clark. “As more capacity becomes available,
the ultimate net loss (UNL) prices start to
match the parametric-type products. Reinsurers prefer to buy UNL because they are not
paying the basis risk of the parametric type
products,” said Clark.
Can ILS funds replace
As ILS funds try to move into the reinsurance
space they have been establishing class two
and three reinsurers. For example Credit Suisse established Kelvin Re. “Many reinsurance
companies take advantage of capital markets
in the one or other form, usually either through
issuance of catastrophe bonds or by way of
collateralised reinsurance. The fact, the ILS investors collateralise their obligations and thus
significantly reduce credit risk, is an important
factor,” says Hannover Re’s Ludolphs. Although Clark says these structures have yet to
declare dominance in this marketplace. “Some
companies prefer rated paper to collateralised
paper,” he says. Beazley is an example of
this: “Our retrocession capacity is well spread
around the world with no particular concentration. Our current panel is dominated by ‘traditional’ rated carriers,” Mills says. There is still
the ongoing fear that if an ILS investor faces
a big loss they will pull out of the business or
enter into disputes over claims payments as
they do not value the same extent. n
17 december 2014
| 13
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news round-up
Moody's downgrades Towergate's CFR to Caa3
Rating agency Moody's Investors Service
downgraded the Corporate Family Rating
(CFR) and Probability of Default Rating on
Towergate Holdings II Ltd by two notches
to Caa3 / Caa3-PD. The senior instruments
issued by Towergate Finance plc have also
been downgraded. The senior secured was
downgraded by three notches to Caa2,
while the senior unsecured was downgraded
by one notch to Ca. All ratings have a developing outlook.
Moody's recognised Towergate's strong
UK insurance broker market presence and
its historically good but declining, EBITDA
(earnings before tax, depreciation and amortisation) profitability, but said it believed
that the Group was “increasingly constrained in terms of its longer-term liquidity
Towergate is addressing its immediate liquidity pressure, which includes about GBP
31m of bond payments due in Q1 2015
through the sale of non-core assets and via
other management actions. Moody's said
that the recently announced sale of Hayward Aviation for GBP 27m would “make a
material contribution to the Group's shortterm cash-flow needs”.
But Moody's also believes that future
revenue and cash-inflows will remain under
pressure, because of tough UK trading
conditions in the UK. It also anticipates
“adverse effects on sales from the Group's
change programme, and potential reputational damage resulting from recent events,
including the loss of certain senior staff
Moody's now believes that the change
programme at Towergate will take longer
and cost more than first anticipated, “with
the timing and magnitude of future cash
benefits still uncertain at this stage.”
Towergate has been approached by third
parties interested in potentially acquiring
the Group, which has also invited senior
bondholders to make acquisition proposals.
Moody's sees Towergate's “strong franchise” as attractive to prospective bidders,
but because of the high levels of debt, it
sees “an elevated probability of some form
of corporate restructuring”.
business will still experience plenty of pricing pressures in 2015. In particular, reinsurance business is
expected to experience a decline in pricing
adequacy, while primary lines are anticipated to remain stable at best. “This also reflects Fitch's negative fundamental outlook on the reinsurance sector
as intense market competition and sluggish
cedant demand has resulted in a softening
market,” said Fitch.
Korea P&I Club in good shape
for future
tal outlook for the company market to stable
from negative, predominantly because of an
expected halt in the fall in motor premiums. “This is expected to be partly offset by
pressures on the personal household market
as motor players are likely to increase their
focus on this line of business while motor
pricing remains inadequate,” said Fitch.
Moreover, low interest rates are expected
to continue to keep investment yields low.
The London market's fundamental outlook for 2015 has been revised to negative
from stable. This underlies the expectation that a
substantial proportion of London market
Korea P&I Club’s prudent underwriting
philosophy and conservative investment
strategy mean the specialist marine insurer
continues to report a strong overall operating performance.
The company, which provides protection
and indemnity (P&I) cover to shipowners in
Asia, has reported a strong level of underwriting profitability over the past five years,
a situation which rating agency AM Best
has attributed to the insurer’s underwriting
philosophy and loss prevention guidelines.
Its profitable underwriting has been further supported by what AM Best described
as “a relatively stable stream of investment
The benefits of this can be seen in the
club’s ability to grow its free reserves by
22% year on year to KRW39bn at the
end of 2013. This percentage increase is
actually down compared with the five-year
compound growth rate which stands at
36%, with AM Best attributing this decline
to slower growth in Korea P&I Club’s premium revenue.
London Market P&C outlook
raised to stable: Fitch
UK non-life insurers have maintained a
stable outlook from Fitch Ratings, despite
being predicted to face pressure on their
underwriting margins in 2015. Financial fundamentals are expected to
remain robust for London market insurers,
said the rating agency. However, Fitch has revised its fundamen-
17 december 2014
| 15
news round-up
In light of this, AM Best has affirmed
Korea P&I Club’s financial strength rating
of A- excellent and issuer credit rating of a-.
The outlook for both is stable.
“The ratings reflect KP&I’s solid riskadjusted capitalisation, track record of
favorable operating performance and the
continued support from the South Korea
government with the aim of facilitating
the long-term development of the marine
infrastructure as a protection and indemnity
insurance provider to shipowners,” said AM
Korea P&I Club’s organic accumulation of profitable net results, coupled with
its conservative reinsurance programme,
continue to provide the club with a large
enough buffer to absorb a potential shock
should it experience an adverse deterioration in its claims experience, AM Best
This does not mean that Korea P&I Club
is immune from a possible downgrade however, with AM Best noting the prolonged
sluggish trading conditions could take their
toll on the business. Furthermore, a rise in
claims severity, as well as a spike in competition from those within the International
Group of P&I Clubs, could take their toll on
the business.
At the same time though, AM Best said
the P&I insurer’s ratings could in fact rise if
the company “can demonstrate a continued
strengthening trend in its risk-adjusted and
absolute capital position while maintaining
high operating profitability”.
Towers Watson gives pensions
access to reinsurance market
Towers Watson has launched a service that
gives pension schemes with defined benefit
liabilities direct access to the reinsurance
market in order to hedge their longevity
risk. Based in Guernsey, Towers Watson
Longevity Direct allows pension schemes to
own a ready-made insurance “cell” that can
write insurance and reinsurance contracts
for longevity swap transactions.
Towers Watson says the structure significantly reduces the cost of hedging longevity
risk for pension schemes by removing the
need for an intermediary insurer to write the
transaction. It also means bigger transactions can be
completed and the best reinsurance pricing
can be accessed.
Keith Ashton, UK Head of Risk Solutions at Towers Watson said in a statement
that access to the reinsurance market has
become increasingly expensive and inefficient in recent years, but the appetite
from defined benefit pension schemes to
hedge their longevity risk has been growing
strongly. Traditional intermediary costs can
be several times higher than accessing the
market directly.
“This structure also means the pension
scheme can take advantage of the best possible reinsurer pricing, rather than having to
compromise on pricing due to the intermediary’s exposure limits,” Ashton said. We
also find that pension scheme and reinsurer
interests are typically very aligned; a direct
agreement can be much less complex than
the longevity swaps we have seen in the
past.” According to Towers Watson, pensionsderisking transactions, such as longevity
swaps, have grown consistently in volume
and value in recent years. In 2014 £32bn
worth of transactions were completed,
double the previous year’s total, in large
part due to BT Pension Scheme’s £16bn
transaction in June which was the largest
deal of its kind.
S&P issues BHSI 'AA+' rating
Standard & Poor's has assigned its 'AA+'
long-term counterparty credit and financial
strength ratings to Berkshire Hathaway
Specialty Insurance (BHSIC). This is the same rating currently assigned
to other Berkshire insurance companies by
S&P under the group methodology criteria.
The outlook is stable.
“We view BHSI-the Berkshire group's
new specialty commercial business
segment--as a key component of Berkshire Hathaway Inc.'s (BRK) strategy to
increase its market presence in the primary
commercial-lines business, which we view
as an integral part of the group's long-term
The ratings agency noted that strong implicit and explicit support from the group,
an experienced management team that has
been recruited to build this business, use of
the Berkshire Hathaway brand for this new
entity, a strong entry into the market, and
an expectation of prospective underwriting
profitability commensurate with BRK's existing insurance operations provide further
support to S&P’s view that BHSI will contribute meaningfully to the BRK insurance
operations' earnings and capital base.
“Capital adequacy, as measured by our
“We view BHSI-the Berkshire group’s
new specialty commercial business
segment--as a key component of
Berkshire Hathaway Inc.’s (BRK) strategy
to increase its market presence in the
primary commercial-lines business,
which we view as an integral part of the
group’s long-term vision.”
| 17 december 2014
news round-up
proprietary insurance capital model, is extremely strong for BHSIC and National Fire
& Marine Insurance Co. (NFM)--the two
primary legal entities BHSI is using and we
expect it to remain so. Therefore, we view
BHSI, and by extension BHSIC, as core
parts of the overall group.”
BHSI was created in 2013 to write specialty commercial lines on both an admitted
(through BHSIC) and non-admitted (NFM)
basis. Its goal is to make BRK a major player in the commercial-lines market, similar
to its position in personal lines (GEICO)
and reinsurance (National Indemnity and
General Re).
BRK hired four senior AIG executives
to start this new unit. The unit's competitive advantages include the Berkshire brand
and strong support from the group, low
operating expenses, and extremely strong
New IDB owners
seek Clal solution
Israel's Finance Ministry commission for
capital markets is unlikely to issue Eduardo
Elsztain and Moti Ben Moshe – the heads
of IDB – the licence that they would need
to continue to control Clal Insurance.
The Ministry is understood to be happy
with the new controllers of IDB, which
changed hands earlier this year after its
previous ownership ran into problems of
over-indebtedness, but is concerned that
IDB remains too financially weak to be a
backer of last resort should Clal itself need
an injection of funds.
In a statement to the Tel Aviv Stock
Exchange yesterday (Sunday) IDB Development Corp said that “The chances that
the commissioner will approve the application [for a license] in its current format by
December 31 are poor”.
Clal is 55% owned by IDB and is one
of its most significant holdings. Elsztain
and Ben Moshe together own about 64%
of IDB, but the reason for their alliance, a
hostility to the previous ownership, has now
gone, and the relationship between the two
businessmen is understood to be strained.
They have talked about buying each other
Nochi Dankner lost control of IDB Holding in December last year, when the courts
approved a bailout plan devised by Moti
Ben-Moshe and Argentina-based entrepreneur Eduardo Elsztain. In January this pair
met with banks to revise IDB's NIS 1.4bn
debt. Key to the bailout was the plan to sell
IDB's 32% stake in Clal.
The pair are committed to injecting a
further NIS 395m into IDB. In June a plan
to sell Clal to China-based JT Capital Fund
fell through because Dorit Salinger, head
of the Finance Ministry Capital Markets &
Insurance regulator, refused to approve the
IDB is now examining several ways in
which the assets of Clal can be used to
strengthen the parent. One possibility is for
smaller stakes in Clal to be sold privately,
over a time period approved by the regulator. Currently Clal is trading at just 0.7x
book and putting the entire 55% stake up
for sale would probably attract offers of
even less than that. n
people moves
CATCo appoints new CFO
CATCo Investment management has appointed Michael Toyer to replace Jason
Bibb as the company’s chief financial officer (CFO), following the latter's decision to
relocate to the UK. Bibb was chief operating officer (COO) and CFO of CATCo and
had been based in Bermuda, but he has now
resigned with immediate effect.
Despite his resignation, Bibb will continue to act as a consultant to CATCo, said
the investment manager.
Toyer will replace Bibb as CFO; he was
previously head of investment operations
at CATCo. The company's new CFO has
over 11 years' accounting experience with a
focus on the reinsurance, alternative investment and financial services sectors, said
Barbican hires
underwriting manager
Barbican Insurance Group has appointed
Matthew Waller as cyber, technology
and media underwriter, with immediate
effect. He will report to Geoff White,
underwriting manager for cyber, technology
and media.
Waller’s expertise spans both the
underwriting and broking arenas. Most
recently, he was a senior underwriter at Ace
USA. His primary responsibility was leading a professional liability book of business,
which encompassed a range of products
including: cyber, media and technology. Before this, he worked for Frank Crystal
& Company and over four years rose to
the position of senior account executive
focusing on professional and management
liability insurance. “The cyber arena is one in which we see
significant opportunities for growth driven
by product innovation and the ability to
deliver bespoke solutions,” said White.
Canopius hires distribution
and subsidiary heads
Canopius has appointed Tony Southern
as head of distribution for its UK Specialty
business and John Eldridge as managing
director of its subsidiary K Drewe Insurance Brokers (KDIB).
Southern has seven years at Hiscox, initially
as head of UK Direct Products before being
appointed European sales and marketing
director. Reporting to Tim Rolfe, chief
executive, UK Specialty, Southern will
oversee the UK Specialty unit’s product
development and distribution strategy. Eldridge brings over a decade of ex-
perience in the UK broking market to
KDIB. He began his insurance career in
2004 with HSBC Insurance Brokers where
he held a number of roles, most recently
head of operations for UK Commercial and
SME Insurance. He then joined E Coleman and Co in 2011 as head of operations
and was appointed as managing director in
Skuld hires marine
liability class underwriter
Skuld has appointed ex-RSA Nick Hart as
marine liability class underwriter to head
up the marine liability team at its Lloyd’s
syndicate, Skuld 1897. Hart, who will be
based in London, joins from RSA where he
was the marine liabilities business leader.
With extensive experience in protection
and indemnity (P&I) Hart’s role will also
include cross-selling the syndicate’s marine
liability capabilities to the wider P&I membership of Skuld. Hart has more than 30
years’ experience in the insurance industry,
largely in the broking community including
JLT and most recently BMS, before joining
RSA in 2011. Throughout his career he has
specialised in P&I marine liability. This
experience is seen as very beneficial in his
new role on the Lloyd’s syndicate. n
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