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It looks like accounting giant PwC had to pay less than 6% of the amount previously being sought in the settled negligent auditing case against the company for its work on failed insurer Quinn Insurance.

Prior to the case settling last year, insolvent Quinn Insurance was seeking €900 million for PwC’s supposed negligent auditing of the business between 2005 and 2008. Quinn Insurance went bust in 2010. PwC, which denied negligence, was also sued for breach of contract and duty.

When the two camps settled in 2022, the terms of what was agreed were not disclosed. Now, according to a report by The Irish Times, PwC paid €53 million to make the €900 million lawsuit go away.

Citing people familiar with the settlement, the publication said neither PwC nor Quinn Insurance’s administrators have confirmed the sum. The Central Bank of Ireland and the Department of Finance were equally mum on the details.

Meanwhile, it was reported that somewhere between €20 million and €30 million went to the Insurance Compensation Fund due to considerable legal fees.

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In a span of three weeks, three major names have left the United Nations-convened Net-Zero Insurance Alliance (NZIA) – this time around we see Hannover Re, the third biggest reinsurer in the world, head for the door.

Without detailing its reasons for the exit, Hannover Re cited “careful consideration” behind the decision. Just like its peers Munich Re and Zurich, though, Hannover Re is similarly sticking to its own climate and sustainability goals.

“Hannover Re remains committed to its sustainability strategy, the associated goals and its support for the Paris Agreement, and aims to achieve full climate neutrality by 2050 at the latest,” said the Talanx Group brand.

According to Hannover Re – which Insurance Business understands is a Climate Alliance Hannover 2035 member – it has operated with a net-zero carbon footprint at its Hannover location since 2016, with that same target set for all of the company’s business operations worldwide to reach by the year 2030.

A signatory to the Principles for Sustainable Insurance, Hannover Re is also part of various regional, national, and global initiatives, associations, and advocacy groups. A list of its affiliations, which no longer includes the NZIA, can be found here.

The NZIA has not publicly reacted to any of the departures.

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Specialty managing general agent Nirvana Risk Partners, which completed its management buyout from Castel Underwriting Agencies in March, has now entered into an incubation partnership with Pro MGA Global Solutions.

“Following the buyout, we are looking for a seamless transition to an independent MGA, and we are very pleased to be partnering with Danny [Maleary] and team, who I’m confident will apply their leading technical expertise to continue to enable the global vision of our business,” shared Nirvana chief executive Kabir Chanrai in a release.

“This is a very exciting time to be launching Nirvana independently, and I’m looking forward to driving ahead with our underwriting-first and service-first mindset. With Pro MGA Global Solutions’ expert support, we can stay focussed on pursuing our long-term growth strategy and delivering valuable solutions to our clients.”

Founded in 2017 by executive chairman Rob Jones, Nirvana specialises in media and technology insurance. Chanrai and Jones are supported by Nirvana’s newly hired head of Europe Thomas Mannsdorfer and sector underwriter Glenn Crickmar.

Commenting on the deal, Pro MGA Global Solutions CEO Danny Maleary (pictured) said: “It’s a pleasure to work with the entrepreneurial Nirvana team who have so successfully built out the business focussing on innovative and profitable cyber, media, and technology liability products.

“Here at Pro MGA Global Solutions, we have extensive experience of the Lloyd’s and London company markets across a wide range of disciplines in brokers, service providers, and insurers, as well as highly relevant experience in the MGA arena across the companies market and international platforms.”

Pro MGA Global Solutions is the independent MGA incubation division of Pro Global Holdings.

“I’m looking forward to bringing the full strength of our network to bear to support the strong growth that is on the horizon for Nirvana in a sustainable way by providing a platform with full regulatory oversight and operational support,” added Maleary.

“This will empower the high-calibre Nirvana team to focus on what they do best: developing innovative products that help solve real-world challenges for their clients.”

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Fidelis Insurance Holdings Limited (FIHL) wants its common shares to be listed on the New York Stock Exchange and has filed a preliminary prospectus with the US Securities and Exchange Commission for its planned initial public offering.

Without providing the IPO price, the holding company said: “Currently, no public market exists for our common shares. We intend to apply to list our common shares on the New York Stock Exchange (NYSE) under the symbol ‘FIHL’…

“We intend to apply for and expect to receive consent under the Exchange Control Act 1972 (and its related regulations) from the Bermuda Monetary Authority for the issue and transfer of the common shares to and between non-residents of Bermuda for exchange control purposes provided the common shares remain listed on an appointed stock exchange, which includes NYSE.

“In granting such consent, neither the BMA nor any other relevant Bermuda authority or government body accepts any responsibility for our financial soundness or the correctness of any of the statements made or opinions expressed in this prospectus.”

FIHL is the parent firm that owns what is known as Fidelis Insurance Group, which consists of insurance operating subsidiaries Fidelis Insurance Bermuda Limited, Fidelis Underwriting Limited, and Fidelis Insurance Ireland DAC. Also part of the group are service company FIHL (UK) Services Limited and its Irish branch.

Separate from FIHL is MGU HoldCo, which officially came to life in January and is the holding company for managing general underwriting platform Fidelis MGU.

According to FIHL, the net proceeds from the IPO are intended to be used to grow its business, by making capital contributions to the group’s insurance operating subsidiaries, and for general corporate purposes.

“This expected use of net proceeds from this offering represents our intentions based on our current plans and business conditions, which could change in the future as our plans and business conditions evolve,” noted FIHL in its preliminary prospectus.

“As a result, our management will have broad discretion over the uses of the net proceeds from this offering, and investors will be relying on the judgment of our management regarding the application of the net proceeds from this offering.”

Lloyd’s is keen to provide insurance for the government, including for the NHS (National Health Service), but the powers that be do not seem convinced.

“While we appreciate the important role the insurance sector plays in building resilience to future risks, it generally does not represent good value for money for central government to purchase commercial insurance,” a report by The Guardian cited a spokesperson for the Treasury as saying amid offers from the camp of Lloyd’s chief executive John Neal and chair Bruce Carnegie-Brown.

“The government is committed to strengthening our own systems and capabilities that support our collective resilience against systemic risks.”

Risk-sharing

Lloyd’s would like to be able to offer cover for the NHS and against climate events. The possibility was reportedly put forward during a previous meeting between Neal and Chancellor Jeremy Hunt.

Subsequently, Carnegie-Brown was quoted by The Guardian as stating: “If we can provide an insurance solution that effectively funded the NHS if it breaches its capacity, or budget issues, then it would show the insurance industry responding in a positive way to something that was caused by an exogenous event.

“Obviously things like a pandemic might cause very dramatic increases in demand on the NHS and its resources.”

It was reported that ILS (insurance-linked securities) could be one way of going about it.

“It’s about understanding what the government’s risk parameters are around these kinds of issues, and historically the government has borne 100% of the risks,” the Lloyd’s chair, who believes the insurance industry can be a government partner in reducing the elements of risk, went on to assert.

“What we’re saying is that the private sector could take a share of this risk, but we would need to explore the precise terms on which we did that.”

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There’s an inexorable agnosticism running in the veins of INSTANDA – and it’s the fuel that powers the insurtech giant’s open-handed approach to partnerships. It all comes down to speed and simplicity, according to CEO Tim Hardcastle (pictured). Those are the two critical metrics for the success of any partnership, whether working with larger insurance incumbents or new startups.

INSTANDA relishes the opportunity it has to work with both sides of the equation, he said, and to exercise the premise at the heart of the business, that of being a “speedboat” helping other ships go faster. It has been a busy few months for the team who have recently been working with a number of healthcare providers looking to do things differently in the insurance market and create meaningful change for their customers.

“I think the common theme between all our partnerships is that the companies most attracted to working with us tend to be facing either a difficult problem to solve or a complex opportunity, depending on whether they’re a glass half empty or glass half full type,” he said. “What they find is that once they’ve done the right elements assembled for success – the regulatory approvals, the balance sheet, the capacity, etc. – then they look at the technology.

“But when you go around the market, you see that the technology available to solve complex problems or enable complex opportunities is few and far between. And the reason for that is simply that technology is very expensive to change. Changing technology takes time and money and when you’re a company trying to be more innovative, you need to make that change relatively quickly and relatively inexpensively.”

Hardcastle noted that there is a real appetite out there for cost-effective, time-efficient solutions that don’t require insurance firms to “bet the farm”, which is where INSTANDA is looking to make its mark. The hallmark of the way the insurtech’s platform works is that it is designed to embrace complexity and simplify it, he said, and, looking across the market, he can’t see many other tech firms able or willing to accomplish that without multi-million-pound price tags.

“The second common theme of our partnerships is that we work with teams that are trying to make the most of those complex opportunities,” he said. “[Our clients] tend to be very ambitious. They’re trying to break the mould and do something different. So, therefore, they can be a bit challenging, a bit demanding and we love that. We liked to be pushed, to be challenged, to be allowed to explore the boundaries of what we can do.”

INSTANDA’s approach to partnerships extends to the ecosystem it is building around itself by working with other companies to bolster its offering and reach. Touching on the latest partnership with UnderwriteMe that the firm is embarking on in the life and health space, Hardcastle highlighted how the right collaboration can eliminate complexity from the inherently complex insurance ecosystem as well as signposting to the wider market that INSTANDA is a trusted and respected brand.

“We’re not just only believers in partnership, we also created a marketplace for ourselves about four years ago which has 200 companies in it,” he said. “And we’re very prepared to be part of other people’s ecosystems, which I think is a hallmark of the respect we have for [the industry]. As a former CIO, I implemented, managed and ran systems that tried to be everything to everybody. They were very expensive and slow to change for that very reason.

“So, with INSTANDA, we went 180 degrees from that. We said, ‘remove the code so change becomes fast and inexpensive. And open yourself up to working with other firms and other technologies that are brilliant at what they do.’ We embrace that we can’t be all things to everybody, you have to accept that there are combinations where two plus two makes five. That’s our philosophy.”

At the end of the day, it all comes back to speed and simplicity, Hardcastle said, and looking across the wider market, it’s clear that the insurance industry is not alone in recognising and appreciating that speed and agility are paramount to success. Look at the history of any sector, and the winners are always the ones who found ways to get ahead of the curve, and who seized every opportunity to become faster and more agile.

This is especially relevant right now, he said, with so much uncertainty facing businesses and with such a plethora of external economic, geopolitical and technological factors all coming together at once. Responding to these different challenges while juggling the changing nature of consumer requirements and expectations is a tightrope but it’s one all organisations have to walk.

“On the one hand, it is very challenging,” he said. “But there’s also a real opportunity in there as well. There’s the opportunity for an organisation to get that speed and agility in place, to make the most of their changing environment, and to meet their customers’ needs and provide a good, reliable experience. Because, in changing times, people want reassurance, solidity and comfort. Insurers that can provide that with the right proposition – they are going to be the winners.”

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ChatGPT, OpenAI’s natural language processing tool, has thrust artificial intelligence (AI) into the mainstream cultural spotlight. More insurance companies are now dipping their toes into the AI pool to gauge its uses.

Swiss insurance group Helvetia is the latest insurer to announce it is testing ChatGPT for its new customer service. Fellow Swiss insurer Zurich said last month that it was experimenting with ChatGPT to find out how AI can help with tasks such as modelling, claims, and data mining.

As carriers explore this new technology, experts have pointed out that there’s one area where companies can see quick wins from AI: customer service.

“There’s been a broad misunderstanding in the insurance industry that AI will replace people altogether,” said Lawrence Buckler (pictured left), VP of sales at Sprout.ai, which uses AI to help speed up claims decisions.

“The hype around ChatGPT has raised awareness of the potential of AI. Rather than replacing people, it enables insurance professionals to provide a better customer experience.”

Sprout.ai partnered with Zurich to produce a claims automation solution in 2021. The London-based insurtech also counts major global insurers like Generali and AXA among its clients.

AI can sift through and review data at a significantly faster rate and with more accuracy than humans, freeing underwriters and claims handlers to do more high-value tasks.

“Claims handlers typically manage one line of business, which is inflexible, and they are focused on the claim and not on the customer,” said Roi Amir (pictured on the right), CEO of Sprout.ai.

“The drive to enable a claims handler to support multiple lines of business is becoming more and more real. With automation, we can make [the claims process] more customer centric.”

AI and ChatGPT among top tech trends

According to Sprout.ai’s CEO, there are three technology-led trends that are making waves in insurance:           

• Artificial intelligence or AI
• The Internet of Things (IoT)
• Parametrics

The ability to train AI models and generate a level of prediction in data allows insurers to take better care of the customers, but also to make better risk management decisions, Amir noted.

“The opportunities are almost limitless with AI,” he told Insurance Business.

IoT technologies, meanwhile, enable carriers to extend their ability to predict and prevent risk. Insurers are leveraging IoT capabilities to assist in customer interactions and accelerate and simplify claims processing.

Networked devices such as telematics and water sensors also create huge volumes of data that can help underwriters to determine risks more accurately.

Finally, bespoke and parameterized insurance solutions are becoming increasingly popular and accessible thanks to technology.

“If you have the sensors, the data, and the AI, you can tailor products specific to the customer,” Amir said.

“Insurers can innovate much more with the right technology because they can adapt it to the right customer at the right time.”

Using AI to adapt to evolving customer expectations

AI and ChatGPT could prove to be useful tools for insurance companies to adapt to the rapidly evolving demands of the market.

Sprout.ai’s research has showed that one in five (21%) of insurance consumers expected claims to be resolved within hours. One hundred percent of younger customers – aged 18-24 – wanted resolution within a week.

The research, which surveyed about 1,000 individuals who had purchased an insurance policy in the last two years, indicated the market was leaning heavily toward a digital-first approach.

“The other thing that we found across all age groups is that a good claim experience is a good predictor for people renewing their policy,” Amir said.

“62% of people that had a good experience on the claim side are likely to renew their policy, while 89% say they are likely not to renew the policy after a bad claim experience. It’s almost a guaranteed churn. Expectations are changing and they’re high.”

For Buckler, increasing market expectations means insurers need to be more flexible, which technology can help them do.

“They need to be able to respond to customer demands and be able to do that at scale,” said Buckler. “That’s where AI can play a big part.”

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Hedge fund Third Point LLC is interested in potentially snapping up SiriusPoint, the board of which will thoroughly consider any such proposal.

SiriusPoint, which reported a US$402.8 million net loss available to common shareholders for 2022, came to life in 2021 as a result of the merger between specialty reinsurer Third Point Reinsurance and multi-line (re)insurer Sirius International Insurance Group.

The business is currently led by RSA alumnus and chief executive Scott Egan, under whose leadership SiriusPoint announced office closures in late 2022.   

Now, in a recent pronouncement, SiriusPoint said: “SiriusPoint Ltd. has acknowledged an indication of interest from Third Point LLC and certain of its affiliates… to explore a potential acquisition of all, or substantially all, of the outstanding common shares of the company.     

“Consistent with its fiduciary duties, in consultation with its financial and legal advisors, the SiriusPoint board of directors will carefully evaluate any proposal to acquire the company, if and when a proposal is received.”

SiriusPoint added that dialogue with its investors is “always welcome”.

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RSA Insurance has appointed Ade Adeyemo (pictured above) as the new head of construction for its UK risk consulting team.

Adeyemo originally joined RSA Risk Consulting in October 2022 and will now lead the construction risk engineering proposition across both commercial and specialty lines. He will be replacing current UK construction lead Trevor Chainey, who is set to retire after a 45-year career.

A qualified chartered civil engineer, Adeyemo has more than three decades of experience in construction management and risk engineering. He transitioned to insurance after working for some of the UK’s largest construction companies for over 10 years, spending time at AIG and Zurich, among other industry players.

Adeyemo is also the chairman of the Construction Insurance Risk Engineers Group.

Andy Jones, risk consulting director at RSA Insurance, expressed his excitement about Adeyemo’s appointment, stating that he is an experienced and well-respected practitioner.

“Since joining us, he has already got to know many of our clients and his expertise has and will be invaluable,” Jones said.

He also wished Trevor Chainey a happy retirement and thanked him for his valuable contributions to the team.

 “He has had a great career and is a valued colleague that we will all miss both personally and professionally,” Jones said of Chainey’s retirement.

Last week, RSA announced the appointment of Gary Mason as its new chief operating officer delivery director. Mason is tasked with leading the technology transformation of the company’s key operating and claims capabilities to improve customer experience. This transformation includes the implementation of the cloud-based Guidewire ClaimCenter system, which aims to simplify the claims experience for customers.

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