ldoherty

Momentum Broker Solutions has marked 2023 with an unprecedented surge in the hiring of apprentices. The trend began in January when four new team members joined the broking team, with one individual broadening their expertise in the business systems department.

The network, based in Leicestershire, has made substantial investments in employee training and development. This week alone, it welcomed an additional three apprentices to its ranks.

A previous study by Forbes uncovered that eight out of 10 millennials possess limited knowledge about career prospects within the insurance sector. Momentum has touted its apprenticeship as an initiative that serves to raise awareness about insurance as a career path and provides individuals with the necessary qualifications and skills to excel.

Momentum also stated that it highly prioritises the apprenticeship program, recognising that it not only helps individuals embark on their career paths but also introduces fresh perspectives and innovative thinking through the young talent they bring on board.

Howard Pepper, managing director, emphasises the significance of nurturing talent from within the organisation.

“We are privileged to be able to support the next generation of insurance professionals through our apprenticeship programme. They add great value to our business and there are invaluable opportunities for those willing to learn. The future of our sector is in good hands,” Pepper said.

What are your thoughts on this story? Please feel free to share your comments below.

In 2017, Equifax Inc, the parent company of Equifax Ltd, experienced a massive breach, during which hackers infiltrated the latter’s servers based in the US, where UK consumer data was outsourced for processing. Approximately 13.8 million UK consumers had their personal data compromised due to the breach.

The compromised UK consumer data included names, dates of birth, phone numbers, Equifax membership login details, partially exposed credit card information, and residential addresses.

Breach was entirely avoidable, FCA stated

The breach and unauthorised data access were entirely avoidable, the FCA noted. The watchdog stated that Equifax failed to consider its association with the parent company as outsourcing, thereby neglecting to exercise adequate oversight over the management and protection of the data being sent. Equifax Inc’s data security systems had known vulnerabilities, and the firm did not take appropriate measures to safeguard UK customer data, it was suggested.

Equifax was unaware of the breach’s impact on UK consumer data until six weeks after Equifax Inc’s discovery of the hack. The company was informed about the incident only five minutes before the American parent company’s public announcement, hindering Equifax’s ability to manage the complaints and delays in contacting affected UK customers.

Following the cybersecurity breach, Equifax also provided inaccurate information to the public regarding the number of affected consumers, and it mishandled complaints by not maintaining quality assurance checks for complaints related to the incident, the regulator found.

The FCA reiterated that regulated financial entities are obligated to establish effective cybersecurity measures to protect the personal data they hold. This includes keeping systems and software updated and fully patched to prevent unauthorised access. Firms remain responsible for data even when outsourced.

In the event of a data breach, an FCA-authorised firm must promptly notify affected individuals in a fair, clear, and accurate manner and implement appropriate procedures for handling complaints.

FCA joint executive director of enforcement and market oversight Therese Chambers said that as financial firms hold customer data that attracts criminal elements, it is important that they keep it safe at all costs. In this regard, the FCA found that Equifax failed.

“They compounded this failure by the ways they mishandled their response to the data breach. Regulated firms are on the hook, regardless of whether they outsource or not. The risk of identity theft never stops. Cyber criminals are sophisticated and innovative; it is imperative that firms maintain the highest standards in data protection,” Chambers said.

Update

In a statement provided to Insurance Business on the agreement reached with the FCA Patricio Remon, president for Europe at Equifax, said:

“Equifax has cooperated with the FCA fully throughout this long running investigation and has been recognised by the FCA for that cooperation, our transformation programme and the voluntary consumer redress exercise we implemented after the incident. Since the cyberattack against our company six years ago, we have invested over $1.5 billion in a security and technology transformation. Few companies have invested more time and resources than Equifax to ensure that consumers’ information is protected.

“We have built one of the world’s most advanced and effective cybersecurity programs. Our maturity level has exceeded all major industry benchmarks, and our posture – the ability to protect our networks, information, and systems from threats – has ranked in the top 1% of technology companies and top 3% of financial services companies analysed, for three consecutive years.”

What are your thoughts on this story? Please feel free to share your comments below.

Sun Life has been in business in the traditional life insurance industry for over 150 years, and cultural shifts accelerated by the COVID-19 pandemic impact have made digital mission critical for the insurance company.

Sun Life clients now expect to have “fully digital journeys” with the life insurer, which also focuses on wealth and health solutions, and this is a global phenomenon, Sun Life president and CEO Kevin Strain (pictured) told Insurance Business.

“Our businesses are fully digitally oriented, and we’ve been stressing culturally that we have to think and act more like a digital company,” Strain said. “We have to be more agile, we have to push decision making closer to the client, and it’s a significant shift in how we think about doing business.”

Strain’s emphasis on this transformation is backed up by the life insurer’s 2022 annual report, in which ‘digital’ or ‘digitally’ are mentioned 60 times. Among celebrated milestones, more than 65,000 financial roadmaps were created for Canadians using the Sun Life One Plan digital tool last year, while in Asia 83% of applications were made digitally, representative of a 12% surge.

“In my mind, the life insurer of the future is a digital business that meets clients’ needs how they need to be met, and how they want them to be met,” Strain said.

Digital drive pivotal to Sun Life’s triple-pronged health, wealth, and insurance lifetime aims

Strain sees this digital drive as playing a pivotal role as the business builds out its capabilities to meet its vision of “helping clients achieve lifetime security and to live healthier lives”, with a greater focus on health and wellness than in the past and on delivering plans that encompass evolving life, health, and wealth needs.

“It’s about creating digital ways of interacting with clients that cover life, health and wealth – and that dive much deeper into wellness will certainly change how we look,” Strain said.

To deliver on this and for the group to continue “demonstrating an impact”, it can no longer be seen as the support function of the past, according to Strain, and Sun Life, which made CA$4.3 billion in insurance sales and had CA$1.33 trillion of assets under management last year, has looked to a fresh mindset.

Agility has become a priority for the more than a century-and-a-half old insurance company, and units have worked more closely with digital teams to share feedback and ideas.

Hybrid “here to stay”, says Sun Life president and CEO Kevin Strain

This digitally focused approach has extended to how Sun Life is looking at its workforce.

Strain, on the other hand, predicted that “hybrid is here to stay”, with some caveats. Sun Life is currently committed to hybrid work, with most businesses not having mandated days and the group having effectively taken a business-by-business and role-by-role approach, according to Strain. For example, its “highly collaborative” asset management business has asked people to come in more frequently, whereas those working on solo projects have been coming in less often.

“One of the things we do believe is that when people come into the office, they should be coming in for collaboration, they should be coming in for teamwork, or sessions that need that sort of innovation,” Strain said. “We want to make the office a magnet for people; we want them to come because they get closer to the culture, and they see the value of those relationships.”

Cultural norms and differences are also at play, with workers in some regions having been more inclined to return to pre-pandemic norms.

“If you went to Asia, you’d find that most people are coming back into the office now,” Strain, who served as president of Sun Life Asia from 2012 to 2017 based in Hong Kong, said. “And that’s been their choice, right? They’ve wanted to come back for lots of different reasons that tie into the culture.”

Sun Life CEO believes advisors are here for the long haul and will benefit from technology

The way the life insurance agents and advisors have interacted with clients has also changed, and Strain further predicted that hybrid expectations where it comes to doing business are here to stay.

Digital savviness has become a key requirement for advisors and agents, while advancements and a surge in interest in generative AI, buoyed by the meteoric rise of ChatGPT into the sphere of public interest, has even seen suggestions that they could find themselves competing with the technology.

A recent survey of 1,000 American consumers by life insurance agency Getsure found that despite 68% of respondents expecting insurance agents to be replaced by AI within 20 years, even more (70%) would not feel comfortable dealing with an AI agent – just 9% said they would feel very comfortable doing so.

“Computers can’t have empathy,” Strain said. “Generative AI is not going to have empathy and the role of the advisor, which is to understand their clients and to empathise with their clients, is so important.”

Clients may be expecting solutions for the computerised age, but advisors and agents will continue to play a key role for the long-term and customers want to continue having that long term “digital journey” with them, in Strain’s view.

“The role of the advisor is even more important today than it’s ever been, because of the complexity and the sophistication of bringing together life insurance, health insurance and wealth products, and the fact that that’s being done over a lifetime,” Strain said.

What’s your take on Sun Life CEO Kevin Strain’s approach to digital and vision for the life insurer of the future? Let us know in the comments below.

QBE Europe has named Erik Keller as the head of liability, effective from Jan. 1, 2024. With an extensive background spanning 30 years in commercial insurance, Keller has predominantly been involved in multinational business affairs.

Having served as the regional underwriting manager for QBE Germany since 2017, Keller brings with him a wealth of experience in liability portfolio management. Prior to joining QBE in 2011, he served as liability portfolio manager at Chubb, RSA, and construction insurance specialist VHV. This experience, as detailed on his LinkedIn, also significantly contributed to his proficiency in casualty underwriting and portfolio development.

At QBE Germany, Keller’s focus primarily gravitated towards large corporate and global business clientele. He actively participated in various European projects, including pivotal roles in QBE’s casualty rulebook, multinational offering, and the development of corporate and specialty practices.

In his new role on a European scale, Keller aims to align QBE’s liability strategy across European countries, focusing on harmonising processes and streamlining operations to enhance efficiency.

Keller will report to Naintara Agarwal, director of underwriting and portfolio management for Europe.

“I am absolutely thrilled to have Erik join the team. He has shown not only how he can support cooperation across European offices but also a dedication to building strong relations with brokers and clients. This, I believe, is the right approach to develop our capability and our market position in Europe,” Agarwal said.

“Developing our local underwriting teams and our casualty product offering is crucial to the long-term success of liability at QBE,” Keller said.

What are your thoughts on this story? Please feel free to share your comments below.

DUAL has announced the appointment of David Harries as group director of underwriting, effective from January 2024. In this new role, Harries will closely collaborate with Alan Telford, DUAL Group CUO.

Before joining DUAL, Harries was associated with Berkshire Hathaway Specialty Insurance, where he held the position of executive underwriter. With a career spanning over 30 years, he held various roles at QBE, including head of financial lines and active underwriter at Syndicate 386. Harries has also managed teams of underwriters in both Lloyd’s and Company Markets.

Richard Clapham, CEO of DUAL Group, also expressed the company’s appreciation for Telford’s significant contributions to the business and noted his planned departure in the summer of 2024. Telford’s intent to travel the world was disrupted by the global pandemic, making his continued presence within the leadership team since 2020 especially valuable. The handover to Harries in January 2024 is anticipated in this key role.

“We’re delighted to welcome David, whose experience makes him a fantastic addition to our Group. DUAL’s regional business model enables our local underwriting teams to respond in an agile way to an ever-evolving market. David will work collaboratively with each of our four regions, ensuring we have a global overview of underwriting trends and will help maximise cross-region partnerships with our carrier partners,” Clapham said.

“David’s proven track record in delivering growth, combined with a deep knowledge of the insurance sector gives him a great perspective on how we can best expand our product range to meet the needs of our brokers and their clients,” Clapham said.

What are your thoughts on this story? Please feel free to share your comments below.

Insurance provider handl Group has formally agreed to acquire the entire share capital of auto locksmith firm We’ve Got The Key (WGTK), with the ambition of doubling the company’s size within 18 months. The move also comes after the appointment of Peter Crellen as the managing director.

Chris Chatterton, chief commercial officer for handl, emphasised the new management’s significant investment in “people plus technology,” aligning with handl’s core theme. With this, WGTK aims to achieve a 4-5% market share in the auto locksmith sector, with an additional goal of doubling callouts from 50,000 to 100,000 annually and expanding their services to assist motor insurers with key-related claims.

WGTK caters to insurers, breakdown and recovery services, fleet and rental sectors, and consumers in need of urgent assistance for lost car keys. The company also serves trade customers with significant fleets and plans to expand its reach to car dealerships, self-insured fleets, and secure more insurance contracts.

Headquartered in Norwich, WGTK will align its operations with Coplus, handl’s specialist ancillary insurer and claims handling business, also based in the city.

The specific financial details of the acquisition remain undisclosed, and the completion of the deal is anticipated later in the autumn.

“The auto locksmith market is hugely disaggregated, with literally thousands of sole traders, and a few small panels, but we believe WGTK has the potential to become a national brand for resolving auto lockouts in the same way that Home Serve did for home emergency cover,” Chatterton said.

“It’s a deal with massive potential, and we’re very excited by this opportunity. Investing in the management team is one of the first things we do when we make an acquisition, so we’re delighted to welcome Peter on board,” he said.

What are your thoughts on this story? Please feel free to share your comments below.

Global reinsurance broker Gallagher Re has welcomed Jonathan Allard (pictured above) as the managing director and head of its newly established global credit and political risk team, based in London.

In this global role, Allard will amalgamate the specialist teams from the London market and internationally, overseeing and advancing Gallagher Re’s global product offering in the domains of credit and political risk. This initiative aims to grant clients access to both treaty and facultative solutions. He will also collaborate with Jim Latorre, who leads the distinct North American surety team, to broaden the reach of the surety sector worldwide.

With vast experience in the reinsurance market, Allard has been a specialist in credit, surety, and political risk from the onset of his broking career. He arrives from Renaissance Re, where he served as vice president of underwriting, overseeing the management and underwriting of credit, surety, and political risk reinsurance, along with structured credit portfolio accounts on European and Lloyd’s balance sheets. Prior to this role, Jonathan spent a decade broking credit, surety, and political risk at Willis Re.

“The creation of a new global leadership role in such a specialised line of business is testament to our continued focus on harnessing the power of Gallagher Re for the benefit of clients, wherever they are in the world. Jonathan’s breadth of experience combining both broker and reinsurer perspectives equips him brilliantly to lead our global product proposition in this area of ever-changing risk,” Gallagher Re international CEO Tony Melia said.

Concurrently with this announcement, Mark Jenkins has also taken up the position of chairman of the global credit and political risk team.

What are your thoughts on this story? Please feel free to share your comments below.

A pressing issue across the industry comes under the spotlight in a new whitepaper released by reinsurtech Supercede: the silent crisis of unreliable reinsurance data and its costly implications for cedents.

The firm delved into this challenge by conducting interviews with over 30 senior global reinsurers, brokers, and cedents. The findings revealed that subpar data is more than a mere inconvenience; it is a substantial financial burden on results. Cedents are directly bearing the cost through escalated reinsurance expenses, reduced capacity, and missed opportunities for innovation.

Rewards and punishments

Across the industry, Supercede revealed unity across reinsurers in what to expect from their cedents: improvements in the standard of submission data. Those which do so stand to be rewarded, provided they continue to provide better data, while those who do not will continue to be punished.

Research cited by the whitepaper unveiled that the quality of submission data varies heavily across the market, with most of the respondents noting substantial variation even in the same regions and business lines. With poor-quality data comes consequences, which affect not only cedents but brokers and reinsurers as well.

The foremost of these is price increases, with “pricing load” becoming standard as reinsurers face more uncertainty that comes from substandard information. Brokers and underwriters, on the other hand, will see postponements for value-adding analytical activities to allow time for manual data manipulation, with this inconvenience ultimately ending in lower goodwill.

With these challenges becoming prevalent, reinsurers are looking for a rise in the bar for quality, with most keen to invest in modernised portfolio management tools that depend on accurate data to operate. Cedents and brokers are doing their parts as well, with entities using new technologies to drive a rise in submission quality.

“We want to be in a position to reward cedents for providing us with good data in our pricing; unfortunately, at the moment, we often have to include uncertainty loads for poor or incomplete data,” said Jonathan Gale, reinsurance chief underwriting officer at AXA XL.

Data distrust tax

Another standout revelation in the report is the weighty “data distrust tax” that reinsurers impose due to vague or inconsistent data. This often results in a significant 10% surge in reinsurance rates, impacting both loss and combined ratios.

That said, reinsurance protection is not better when cedents pay out more for the same coverage. Supercede noted that CEOs who are unsuccessful at equipping their ceded reinsurance teams with budgets for building better submission packs should reconsider, especially if outwards spend goes to tens or hundreds of millions a year.

“’Pricing loads’ are often implicit: actuaries and underwriters will make conservative assumptions to allow for uncertainty in the data and risk,” Liberty Mutual Re chief actuary Hetul Patel said. “This will be built into the technical price.”

Incomplete data sets

Adding complexity to the landscape, cedents providing incomplete data sets often find themselves excluded from tailored evaluations. Instead, they are grouped into broad-stroke portfolio generalisations, missing out on bespoke, more favourable terms.

In general, those easiest to work with are prioritised, while more cumbersome ones might not get the best underwriting options. Supercede said that underwriters are right to walk away from cedents who are harder to work with, as reinsurers need to build their portfolios more efficiently, even if it means that some will get left out.

“We believe high-quality data is essential for a well-functioning reinsurance market, but our research shows current practices fall far short,” Supercede president Ben Rose (pictured above) said. “By shining a light on the issue, we hope to motivate positive change across the industry.”

What are your thoughts on this story? Please feel free to share your comments below.

Renko Dirksen (pictured above) enjoys his global responsibilities.

“I have the privilege to not only work in Germany but to work in so many different countries and experience so many different cultures and ways of doing the insurance business,” he said.  “That’s really exciting.”

Dirksen is on the board of directors for ARAG, a firm specialising in legal expense insurance (LEI). ARAG has a presence in 19 countries around the world, including the UK. ARAG regards itself as “the leading legal insurer worldwide” and is the largest privately owned insurance company in Germany.

Insurance Business met with Dirksen on his recent visit to ARAG’s Australia business. The operation Down Under was launched a few years ago and Dirksen said he was there to get a feeling for the local challenges and opportunities.

From law school to ARAG

IB asked the board member from Düsseldorf how his insurance career started?

“I remember when I graduated from law school, I found that I did not want to practice as a lawyer or work as a judge or prosecutor, but I did want to get into management and business which was everything I found interesting,” he said.

Dirksen came across a job offering from the ARAG Group – and the rest is history. He became the assistant to the CEO.

Part of the reason for his longevity with the firm, he said, is his confidence in the product which he thinks has “a lot of value.”

“Having a legal expenses insurance policy in your pocket really helps,” said Dirksen. “Then you can pursue your case at every level and go to the highest court to pursue your rights.”

The other reason is, he said, is how an insurance career involves working collaboratively to solve problems.

“At the same time, people energise,” he said. “I really like to work with people to solve problems, to interact with people and my colleagues.”

Dirksen said this makes the insurance business “very exciting because there are so many different people from so many different backgrounds.”

Medical negligence, unpaid bills and corporate scandals

He told IB about some of the ways ARAG’s LEI has helped people pursue their legal rights. The examples included labour disputes, cases of medical negligence and small businesses chasing up unpaid bills.

“We do a lot of clinical negligence cases, especially in the UK,” Dirksen said. “They are very often heartbreaking to be honest.”

However, he said people with ARAG’s LEI insurance have been able to achieve better outcomes and rebuild some sort of quality of life.

“When you see the initial offering from the other side and you see the outcome, then our customers know that it’s really worthwhile to have this policy,” said Dirksen.

One case in which ARAG’s customers were able to pursue their rights made worldwide headlines.

“The diesel scandal, for example with Volkswagen (VW),” he said. “With us the average consumer can say, ‘I’m going to take up the fight and go against Volkswagen’.”

Dirksen said LEI provided individual VW owners with a way to pursue justice against a huge corporate firm.

“In most situations, consumers wouldn’t meet them at eye level – Volkswagen would just outspend them,” he said. “In some ways we are like David´s slingshot against Goliath.”

According to information from ARAG, the firm made payments of approximately €70 million for 36,000 cases in connection with the diesel scandal. The ARAG customers had purchased vehicles from VW and other manufacturers that used the same emissions-cheating device and were able to use their LEI policies to pursue compensation.

More on the VW diesel emissions scandal

In 2016, car maker Volkswagen was forced to recall millions of cars – about 8.5 million across Europe and half million in the US according to a BBC News report – after a car emissions scandal.

VW admitted it was cheating emissions tests and has paid out billions of dollars in costs and penalties. In Australia, the company received a fine from the Australian Competition and Consumer Commission (ACCC) of $125 million, the highest ever imposed by the Federal Court for breaches of consumer laws.

However, years later, VW continues to fight court battles.

In June, a former Audi CEO (VW owns Audi) was handed a suspended sentence of nearly two years for his role in the diesel scandal. According to Reuters, former and current VW managers are still on trial in Germany and there are more than 100,000 diesel emission scandal cases still pending at the highest court alone.

What do you like most about working in the insurance industry? Please tell us below.

Allianz and Intact are considering their options where it comes to an Aviva takeover, The Times has reported.

An American insurer is also in the frame, The Times reported, citing City sources.

At least one of Allianz and Intact is said to be mulling a £6 per share proposal for Aviva, according to the report.

Shares in UK-headquartered Aviva jumped on the news, rising upwards of 10% on Friday from the market’s open. However, this dampened somewhat as analysts queried the veracity of market chatter.

Speculation also boosted other FTSE100 insurers, The Times reported, with Phoenix up 2.27%, Prudential up 2.85% and Legal & General gaining 4.11%.

Aviva, which reported rising operating profit of £715 million for the first half of 2023, has trimmed down its operations under Aviva CEO Amanda Blanc to focus on its UK, Ireland and Canada businesses.