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Results season continues with the turn of Hastings parent Sampo Plc detailing the insurance group’s financial results in the first quarter of 2023.

Here’s how Sampo Group performed in the three-month period, as reported under the new accounting standard:

Net profit for the company’s equity holders stood at €271 million. The corresponding figure in Q1 2022 was €773 million. Compared to the previous year, both profit before taxes and net financial result in Q1 2023 went down, while underwriting result and insurance service result were slightly higher.

“I am encouraged by the progress on our organic growth initiatives, both in the Nordics and the UK, where we have capitalised on our strong positions,” said group chief executive Torbjörn Magnusson in a release, while pointing to “solid results” across all operations.

Meanwhile the quarterly report is the last with Björn Wahlroos (also known as Nalle) as chair.

“I would like to thank Nalle for his huge commitment and contribution to Sampo for over 20 years and, although he leaves on May 17, Sampo will retain the razor-sharp focus on profitability and value creation that he has instilled in the group over his time here,” commented Magnusson.

What do you think about Sampo Group’s financial results? Share your thoughts in the comments below.

Insurance giant Chubb has announced the appointment of Tim Charters as the climate tech practice leader for the UK and Ireland (UKI) region, in a move that further strengthens its Chubb Climate+ leadership team.

In a Press release, Chubb noted that in his new role, Charters will be tasked with expanding Chubb’s underwriting portfolio and creating innovative solutions to support Climate Tech companies in their efforts to mitigate the impact of climate change. His responsibilities will include supporting the efficient and sustainable use of resources, products, services, and technologies that support the transition to a low-carbon economy.

Charters previously served as a corporate finance advisor for the UK government’s Department for Business, Energy, and Industrial Strategy (BEIS) since 2019. Prior to that, he held senior roles at BEIS focused on energy efficiency and innovation. He also worked in the energy sector, including for a renewables start-up.

Charters will be based in London and will report to Louise Joyce, head of industry practices, UK and Ireland, Chubb. His appointment is effective immediately.

Commenting on the appointment, Matt Hardy, leader of Chubb Climate+ for the company’s general insurance operations in 51 countries and territories outside the U.S., Canada, and Bermuda, said: “Tim has years of experience working in the energy and renewables industry and brings with him new perspectives and insights that will help our Chubb Climate+ team drive the growth of our Climate Tech business in the UKI.”

Louise Joyce added: “I am so pleased to welcome Tim to Chubb. His background working as an advisor on energy and climate to the UK government, together with the insights gained from his direct involvement in the renewables and energy innovation sector, gives him a unique skillset in insurance that will only serve to benefit our Climate Tech Practice clients and broker partners.”

Chubb Climate+ was launched in January this year, offering a full range of insurance products and services to businesses involved in developing or employing new technologies and processes to support the transition to a low-carbon economy. It also provides risk management and resiliency services to help those managing the impact of climate change.

Aviva, as part of its COVID-19 Pledge to customers in the UK, is paying a further £47 million – bringing the total to £128 million in payouts for private medical insurance claims disruption during the pandemic.  

Lifting the lid on the sum, Aviva said in a release: “The figure represents Aviva’s final assessment of the difference between expected claims costs and actual claims costs for the period of claims monitored, from March 1, 2020 to December 31, 2022, when some treatments and procedures were delayed rather than cancelled.”

In 2022, Aviva returned £81 million to its private medical insurance customers. As previously promised, any further payment made in 2023 will include a 20% increase.

“We value our private medical insurance customers’ loyalty, and it was only right that we pledged to return any difference in claims costs to them after a full and fair assessment of the impact of the pandemic on our claims experience,” said Aviva UK Health managing director Steve Bridger.

“I’m delighted that we have completed our final assessment and that we can make a further payment to customers at this time of increased living costs.”

Brokers and customers will be contacted about the payments over the coming weeks.

What do you think about this private medical insurance story? Share your thoughts in the comments below.

This article was provided by Heather Wilmot (pictured), claims operations manager at ARAG UK.

The latest data released by His Majesty’s Courts and Tribunal Service (HMCTS), for the final quarter of 2022, make grim reading for anyone who may have to use the employment tribunal system at any time in the foreseeable future.

The headline ‘caseload outstanding’ figure may have dropped slightly from last year’s peak of 506,911 claims, but this total includes multiple claims so will inevitably fluctuate when single cases with perhaps hundreds or even thousands of claimants enter or leave the system.

However, even the new 475,004 headline figure means that there are still nearly half a million people waiting for their employment dispute to be resolved, and the data suggest that many will have to wait at least a year.

The Ministry of Justice (MoJ) published new figures in February, responding to a parliamentary question, that revealed the average waiting time between an employment tribunal claim being received and reaching its first hearing has increased more than 60%, from 30 weeks in 2011 to 49 weeks at the end of March 2021. In many cases, that might be just for a preliminary hearing.

While the half a million employees apparently waiting in the tribunal service queue is a truly staggering number, our analysis suggests that around 50,000 businesses are trapped in the same holding pattern, waiting for a dispute with an employee to be resolved.

There were 44,758 businesses waiting on single claims (those with only one claimant) at the end of last year, an increase of 8% in just 12 months, with over five thousand others waiting to defend a multiple claim, leaving a total open caseload of 50,291 at the end of January this year.

Like all HMCTS services, employment tribunal proceedings were inevitably affected by the pandemic, but the recently released data point to much deeper issues. The number of single cases outstanding, which provides a better indication of the backlog in the system, is the highest on record going back to 2008, roughly double what it was fifteen years ago, and has continued to increase since lockdowns came to an end.

Nor can the MOJ blame recent events. The total number of outstanding claims can rise and fall on the receipt or disposal of a single case with many claimants, but the number of cases accepted by HMCTS has outstripped the number disposed of, almost every quarter since 2015.

The problems this backlog creates are as intolerable for businesses at they are for employees who are waiting for their claims to be heard. Cases that are delayed a year before even reaching a preliminary hearing, leave both parties in a kind limbo. Over such a long time, recollections fade, costs increase, and satisfactory outcomes can be jeopardised.”

Larger businesses with many employees are likely to have experienced claims before and may even be accustomed to the time such matters now take. For the many SMEs that ARAG insures against the costs of legal problems, employment disputes have become even more disruptive.

We do what we can to help them resolve claims through mediation and hopefully to reach a settlement without troubling a tribunal, but this is a long-term issue for the MoJ that needs to be fixed.

In 2015, the Parker Review was set up by the UK government to review and improve diversity in Britain’s boardrooms.

The review’s initial report, published in 2017, provided a set of suggestions and established a target called “One by 2021,” which aimed to ensure that all FTSE 100 boards had at least one director from a minority ethnic background by December 2021. Additionally, the review set a similar goal named “One by 2024” for all FTSE 250 boards.

Valuing diverse talent

The Parker review sets the tone on ethnic diversity across all companies and is a key contribution to a UK business environment, maintaining a focus on ethnic diversity at executive and senior management level.

For larger companies, NEDs, Chairs and Board members may be more likely to come from outside insurance, and these leaders of industry will bring an expectation of diversity from the businesses they oversee. Similarly, it reinforces this topic of importance for investors and potential employees as well as customers.

Target setting works

In March this year, the Parker Review announced the results of its 2022 voluntary census on the ethnic diversity of company boards, showing that 96 FTSE 100 companies now have at least one ethnically diverse director on their boards, up from 89 last year. Of these 96 companies, 49 have more than one ethnically diverse director on their board. In the FTSE 250, 67% of companies that responded to the census met the target of appointing at least one ethnically diverse director, up from 55% last year. 

New targets have been launched for December 2027, with each FTSE 350 company asked to set its own percentage target for senior management positions that will be occupied by ethnically diverse executives.

The Parker Review also believes that there is compelling logic for setting targets for ethnically diverse inclusion within large private companies, and will ask 50 of the UK’s largest private companies to provide data from December 2023. This may well include companies from the insurance sector.

The progress made in the past few years shows that target setting works, but this is not the time for self-congratulation and resting upon laurels. There are still outlier companies within the FTSE 100 who did not meet the original target, and despite the more positive picture at the top there is a long way to go to ensure inclusion at all levels of businesses.

Nonetheless, the Parker review provides strong evidence to counter any spurious argument that driving diversity in the boardroom somehow dilutes the quality of the executive level, and suggests that progress is being made towards achieving the goal of diversity and inclusion.

Ashwin Mistry, non-exec director at Broker Insights states “Having sat on a number of Boards throughout my career, I have learnt that coming from a different background brings with it a different and positive perspective. It may not be that values and ethics differ greatly, but life experience teaches you that your upbringing is somewhat different and elements of exposure bring with it a valuable sense of respect, structure and passion. I know that I think differently from other colleagues and that makes me extremely proud of my heritage “

Board diversity in insurance

Although there are only a handful of insurance companies in the FTSE 350, the Parker review is important for insurance companies to take notice of because the industry has historically lacked diversity, particularly at the executive level. The ABI found that just 2% of insurance executives came from an ethnically diverse background, compared to over 14% of the working population being ethnically diverse. Furthermore, its research last year found that the proportion of ethnically diverse entry level employees in insurance has worsened, from 10% to 9%, a worrying trend for the potential pipeline of talent not reaching the sector.

The importance of representation

Having diverse representation at the top level of our industry not only brings in a variety of perspectives, experiences, and backgrounds that greatly benefit businesses, but also serves as inspiration for underrepresented individuals, motivating them to pursue careers in the insurance industry.

At iCAN, we are committed to championing multicultural talent within the financial sector at all levels. We firmly believe that the ethnically diverse talent pool contains immense untapped potential, with the ability to emerge as future board members. It is incumbent on all of us to create clear and robust pathways for this talent to flourish and reach their full potential, and therefore important to have diverse role models in leadership positions today who can inspire and guide the next generation of leaders.

AXIS Capital Holdings has announced that Vincent C. Tizzio has assumed the role of president and CEO of the company.

Tizzio officially assumed the role Thursday, timed to coincide with the company’s annual general meeting at its headquarters in Bermuda.

Tizzio’s promotion to president and CEO was announced in December. He succeeds longtime AXIS president and CEO Albert Benchimol, who will continue to serve as a strategic advisor to the company through the end of the year.

“On behalf of the board of directors and our entire team at AXIS, we couldn’t be more excited to name Vince as the company’s president and CEO,” said Henry Smith, chair of the AXIS board of directors. “Vince is a stellar leader who brings the vision, expansive specialty underwriting knowledge, and passion needed to take our company to the next level. He is also an excellent people leader who perfectly embodies the company’s culture and values.

Tizzio joined AXIS in January 2022 as senior advisor for insurance market strategy and future insurance CEO, reporting to Benchimol. In June 2022, he was promoted to CEO of specialty insurance and reinsurance.

“I’m deeply honoured to be named president and CEO of AXIS and to have the opportunity to build on the foundation established by Albert and the team,” Tizzio said. “I express my gratitude to Albert, Henry, the board of directors, and our colleagues worldwide for placing their trust in me. It’s my strong belief that we are only just beginning to tap into our potential as a great underwriting company that stands apart for the specialty expertise and acumen of our people and the value that we provide to our customers. In the current dynamic market, there is a greater need than ever for the tailored specialty insurance products and services that we offer.”

“Serving as president and CEO of AXIS has been the highlight of my career,” Benchimol said. “Words cannot express the gratitude that I feel towards my colleagues at AXIS, as well as to our brokers and partners, for their partnership, commitment and friendship. I’m proud of all that we accomplished and excited for the future that stands before AXIS. In Vince we have a fantastic leader who has the vision and ability to take AXIS to even greater levels of success.”

“The board and I are grateful to Albert Benchimol for the leadership that he brought to AXIS for close to 13 years,” Smith said. “Under Albert’s direction, AXIS transformed and refocused as a specialty leader, cultivating a strong and vibrant workplace culture, while taking crucial steps forward in building a pathway to lasting, profitable growth.”

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New funding for the global insurtech sector rose to US$1.39 billion during the first quarter of 2023, according to a new report from Gallagher Re.

That’s up from US$1.01 billion in the fourth quarter of 2022, the lowest quarterly total since Q1 2020.

Average deal size rose 25.3% in the first quarter of 2023, although deal count held steady, according to Gallagher Re’s latest Global InsurTech Report. Mega-round funding accounted for only 12.9% of the total, the lowest level since Q1 2020.

The quarterly investment increase was driven by P&C insurtech funding, which spiked by more than 53% to US$967.89 million, the report found. Life and health funding was also up, risking 9.65 to US$420.73 million.

Total early-stage funding was US$423.59 million, although early-stage L&H funding tumbled 44.3% from Q4 2022 to US$119.04 million. The average early-stage deal rose 28% to US$8.31 million.

The majority of investments by (re)insurers were for early-stage rounds, a trend that’s now lasted for six straight quarters, the report found.

Funding totals indicate that 2023 may see a return to more “normal” levels of insurtech funding seen prior to 2021, when 62% of investments were through mega-rounds, compared to 41% in 2022, Gallagher Re said.

“2023 may be the beginning of a new era for insurtech,” said Dr. Andrew Johnston, global head of insurtech at Gallagher Re. “2021 undoubtedly marked the funding peak, fueled by COVID-19 uncertainty and an organically occurring crescendo. The sector came back down to earth in 2022, leading to some serious restructures, cost-saving actions, and new business strategies. A lot of companies did not make it through.

“Founders are now thinking about long-term sustainability and growth, and realising their businesses will need to pull the plough themselves, reliant on their own capabilities and revenues,” Johnston said. “A significant upside seems to be the genuine willingness of many (re)insurers, brokers and agents to adopt technology. The pressure is therefore on insurtechs to make their businesses palatable and value-adding.”

The Q1 edition of the Global InsurTech Report is the first of four reports in 2023 that will focus on the life cycle stages of insurtech funding:

• Early-stage incubation rounds (angel, convertible note, pre-seed, seed, and seed VC)
• Early-stage acceleration rounds (series A)
• Mid-stage expansion rounds (series B and C)
• Late stage growth and view-to-exit rounds (series D, E+, growth equity, PE, exits and corporate majority)

The Q1 report includes several case studies of insurtechs whose most recent funding round fits the incubation criteria, Gallagher Re said.

“Despite the chequered financial performance of insurtechs, they have successfully continued to attract funding, partially driven by investors chasing yield, but also by tech-oriented investors applying tech-style funding philosophies – and valuations,” said Deepon Sen Gupta, global head of strategic advisory for Gallagher Re. “However, investors are increasingly focused on obtaining a return on their capital, and understanding payback periods. Rather than just being hypnotised by the size of the total addressable market, they are now keen to see a genuine need for an insurtech’s existence.”

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Swiss Re has enjoyed a turnaround, reporting a profitable first quarter after suffering a loss in the same three-month span in 2022.

The reinsurance giant attributed the increase in P&C Re net income to robust price improvements and higher investment results, while L&H Re’s result benefitted from a strong decline in COVID-19 claims and a higher investment income.

As for Corporate Solutions, the segment’s higher net income was due to continued disciplined underwriting, careful risk selection, and adequate pricing.

“The first-quarter results demonstrate the resilience of all our main businesses, supported by adequate pricing, higher investment returns, and cost discipline,” said group chief executive officer Christian Mumenthaler.

“In an uncertain macroeconomic environment, we continue to focus on achieving our ambitious profit target of more than US$3 billion for the group in 2023. The successful P&C Re renewals so far this year and a good start in L&H Re and Corporate Solutions underpin our confidence, supported by rising interest rates, cost discipline, and a very strong capital position.”

Additionally, Swiss Re has successfully transitioned to a new structure to create what the CEO called a “simpler and nimbler” organisation.

The British government’s draft Terrorism (Protection of Premises) Bill is now available for pre-legislative scrutiny, and terrorism reinsurer Pool Re has been quick to react.

To be known as Martyn’s Law (previously Protect Duty), the proposed legislation aims to improve public safety and national security by protecting public premises and events against the treat of terrorism. The goal is to require those responsible for certain premises and events to implement appropriate and proportionate mitigation measures.

‘Crucial step’ against terrorism

Welcoming the development, Pool Re chief executive Tom Clementi said in an emailed release: “The government’s announcement that it has published its draft Terrorism (Protection of Premises) Bill is a crucial step in enhancing the protection of the UK’s publicly accessible locations from terrorist attacks.

“Pool Re will support the government and insurance industry with the implementation of Martyn’s Law, by providing information and education regarding what businesses and organisations need to do to prepare for its introduction.”

It was noted that the legislation may apply to more than 300,000 premises across the UK. Qualifying premises will be divided into two tiers, standard and enhanced, and will have their corresponding requirements under Martyn’s Law.

Figen Murray OBE – mother of Martyn Hett, who was among those killed in the Manchester Arena terrorist attack in 2017 – also called the progress an important step forward to a safer country.

“Martyn’s Law will end the ridiculous situation where venues have legal obligations for how many toilets they have but no obligation to keep their customers protected,” stated Murray. “Of course Martyn’s Law won’t stop all terror attacks, but it will make crowded places better protected and prepared, and make the terrorists’ job that bit harder.”

Meanwhile, Pool Re will be offering advice to brokers and insurers on the legislative requirements where appropriate. Resources will be available at poolre.co.uk/martyns-law/.

Ahead of formal introduction to Parliament, the draft bill will be scrutinised by the Home Affairs Select Committee.

What do you think about this terrorism story? Share your thoughts in the comments below.

Aon Plc has released its earnings report for the three months ended March 31, and the results show the insurance broking giant posting growth all-round.

As indicated above, all segments – commercial risk solutions, reinsurance solutions, health solutions, and wealth solutions – contributed improved revenues.

Lifting the lid on the higher figures, Aon said: “Total revenue increased US$201 million, or 5%, to US$3,871 million, compared to the prior year period, with organic revenue growth of 7%, driven by ongoing strong retention, net new business generation, and management of the renewal book portfolio, and a 1% favourable impact from fiduciary investment income, partially offset by a 3% unfavourable impact from foreign currency translation.”

In terms of the commercial risk segment, the company had this to say: “Growth in retail brokerage was highlighted by double-digit growth in EMEA (Europe, the Middle East, and Africa), Latin America, and the Pacific driven by continued strength in core P&C (property and casualty). The US grew modestly after growing double-digits in the prior year period and reflecting the impact of the external M&A (mergers and acquisitions) and IPO (initial public offering) markets on M&A services.”

Meanwhile, the rise in operating income was attributed to organic revenue growth and increased fiduciary investment income.

“In the first quarter, our team built momentum for 2023 by delivering strong operational performance, highlighted by 7% organic revenue growth and 70 basis points of adjusted operating margin improvement,” noted Aon chief executive Greg Case. “As we move past the pandemic, our clients are telling us there are two primary areas where they are urgently looking for competitive advantage: risk and people.

“As these results demonstrate, our Aon United strategy has established the firm as uniquely capable of helping clients go on offense and make better decisions that mitigate risk to their business and maximise the impact of their people.”

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