ldoherty

The Confederation of British Industry (CBI), “abhorrent” allegations against which include two rape claims, has lost another member – this time it’s the turn of the Association of Medical Insurers and Intermediaries (amii) to cut ties with the scandal-hit organisation.

“We are deeply concerned about the allegations made about the CBI and have therefore decided to terminate our membership with immediate effect,” said amii executive chair Dave Middleton (pictured) in a statement sent to Insurance Business.

“In light of this, amii cannot continue to support the CBI, and we have notified the organisation of our immediate termination accordingly.”

President’s open letter

On Monday, CBI president Brian McBride addressed members in an open letter.

“I wanted to talk to each of you directly and openly about the crisis that has engulfed the CBI,” wrote McBride. “About how this organisation, for almost 60 years an active and proud champion of British industry, let down its own people, and deservedly lost your trust in consequence. And about what steps we are taking to give you reason to consider trusting us again.

“Whether that is possible, I simply don’t know. That is, of course, for each of you to decide. Whichever decision you each make, I believe that it is still necessary and valuable to share directly with you, our members, and to industry as a whole, all that we have learned about what went wrong in our organisation, and what we could have better done to prevent these terrible incidents from ever having taken place.”

The findings, according to the CBI, are based both on its own analysis and on the independent investigations conducted by law firm Fox Williams on the allegations raised by The Guardian.

Citing a collective sense of shame among the CBI board and leadership, McBride acknowledged the organisation’s shortcomings.

“In retrospect, we now know that we were complacent,” said the president, who described the allegations as abhorrent. “And we made mistakes in how we organised the business that led to terrible consequences… We didn’t put in place sufficient preventative measures to protect our people from those seeking to cause harm, and we didn’t react properly when issues arose as a result.

“We failed to filter out culturally toxic people during the hiring process. We failed to conduct proper cultural onboarding of staff. Some of our managers were promoted too quickly without the necessary prior and ongoing training to protect our cultural values, and to properly react when those values were violated. In assessing performance, we paid more attention to competence than to behaviour.

“Our HR function was not represented at board level, which reduced escalation paths to senior levels of the company when these were most needed. And we tried to find resolution in sexual harassment cases when we should have removed those offenders from our business. In retrospect, this last point was our most grievous error, which led to a reluctance among women to formalise complaints.”

McBride conceded that the above pushed victims of harassment or violence to believe that their only option was to take their experiences to a newspaper. The president also admitted having communicated poorly and ineffectively with members amid the scandal.

“In doing so, commentators concluded that the organisation was cold-hearted and toxic, and that serious allegations of rape had been covered up, when in fact they were never made known to the senior leadership or to the board of the CBI until revealed by The Guardian,” continued McBride. “I will tell you that every member of the CBI’s leadership team is devastated and appalled by the substance of these allegations.

“Our collective failure to completely protect vulnerable employees, to ensure that the alleged incidents could never happen in the first place, and to put in place proper mechanisms to rapidly escalate incidents of this nature to the level of senior leadership, these failings most of all drive the shame…”

The CBI, which has suspended all policy and membership activity until an extraordinary general meeting in June, will now operate a zero-tolerance approach to sexual harassment and bullying behaviour as part of its response. The process of hiring a CBI chief people officer is also underway.

“I hope that we can effectively serve alongside you once more in future, albeit as a changed, and much improved CBI,” stated McBride. “Whether or not that is possible, I hope that what I have shared with you is useful in the work you do to build great cultures in your own organisations.”

What do you think of this ongoing story? Share your thoughts in the comments below.

Ardonagh Advisory Holdings, the SME broking platform of The Ardonagh Group, is acquiring a majority shareholding in broker Stanhope Cooper and managing general agent Renovation Underwriting.

Subject to regulatory approval, Stanhope Cooper will join the broking platform. Founded in 2006 in Petersfield, Stanhope Cooper is a high net worth (HNW) broker led by managing director William Cooper.

“This latest addition to the Advisory portfolio demonstrates our commitment to furthering the depth and breadth of our client proposition,” said Advisory Insurance Brokers chief executive Richard Tuplin (pictured). “By investing in these high-pedigree businesses, we are supporting our strategy to continue expansion into HNW private clients as well as large corporate and commercial clients.

“Stanhope Cooper is a highly entrepreneurial company, which has achieved an impressive level of organic growth, and we are excited to start work with the team to support their ambitions.”

For William Cooper, coming under the Ardonagh Advisory umbrella is “the right opportunity at the right time”.

“We sought an investor so that we could achieve even greater heights by diversifying our business to provide something truly unique and improve our offer to clients,” revealed the managing director. “Joining a business that shares our ambition and vision will make for a highly beneficial collaboration, and we look forward to working more closely with the Ardonagh team.”

MGA boost

Renovation Underwriting, meanwhile, will become part of Ardonagh Advisory’s UK commercial MGA which is led by Jaime Swindle. Headed by managing director Doug Brown, Renovation Underwriting provides insurance for private client contract works and high-value projects.

“We’ve always been driven to offer a market-leading proposition in our niche area of contract works insurance, and to do what we do better than anyone else,” declared Brown.

“Our new backing from The Ardonagh Group enables us to move forward with the same vision, but with a bigger platform and greater resources to propel our ambitious plans – all of which will still be led and delivered by our specialist, committed team.”

UK commercial MGA CEO Jaime Swindle, who will be joined by Brown in the division’s executive committee, also had nothing but nice words for the new arrival.

“The team at Renovation Underwriting has a wealth of experience and strong carrier relationships that complement our existing insurer partnerships and product strategy,” noted Swindle.

“As the commercial MGA continues to focus on offering specialist products to market, this business, along with Doug Brown’s market-leading expertise, will help to further enhance our proposition and the group as a whole.”

Financial terms of the double swoop were not disclosed.

What do you think of this acquisition story? Share your thoughts in the comments below.

David Croom-Johnson (pictured), who retired in the middle of 2022 after serving as chief executive of AEGIS London, has emerged at the board of Munich Re Syndicate.

In a LinkedIn job update that now has more than 230 reactions, Croom-Johnson said: “I’m happy to share that I’m starting a new position as non-executive board member at Munich Re Syndicate Limited.”

In January 2022, the then soon-to-be-exiting boss stated: “It has been an honour and a privilege to lead AEGIS London over the past seven years and now seems the natural time to step aside.

“I will be leaving the syndicate as a top quartile performer in the excellent hands of a high-quality management team led by Alex with whom I have worked for many years and who has been a major contributor to our success to date.” 

Meanwhile Munich Re Syndicate, also known as Syndicate 457 at Lloyd’s, came to life in 1977 when approximately 400 Lloyd’s syndicates existed. Currently, there are less than 100 in the market. The syndicate was acquired by Munich Re Group in 1997.

What do you think about David Croom-Johnson’s new role? Share your thoughts in the comments below.    

As fresh allegations continue to pile up against the Confederation of British Industry (CBI), insurance giant Aviva has cancelled its membership. Earlier today, an exclusive report in the Guardian revealed new claims of assault and harassment by CBI personnel.

A report from Reuters revealed that Aviva said the allegations so far are serious enough to warrant it immediately ending its membership of the UK’s leading business lobby organisation, despite the ongoing independent inquiry commissioned by the CBI and the ongoing police investigation into the claims.

“In light of the very serious allegations made, and the CBI’s handling of the process and response, we believe the CBI is no longer able to fulfil its core function – to be a representative voice of business in the UK,” an Aviva spokesperson said.

The update follows the news earlier this week that the British Insurance Brokers’ Association (BIBA) has also terminated its CBI membership. The deepening scandal is continuing to make national headlines, while the CBI – which is said to represent some 190,000 businesses – has engaged the services of a law firm to conduct an investigation, which is expected to be published later today, Friday, April 21.

Meanwhile, Reuters noted that the City of London Police opened an investigation into what the CBI called “a serious criminal offence”.

Last week saw the CBI sack director general Tony Danker for conduct concerns which the Guardian reported was not linked to the criminal allegations. The CBI has also said an urgent root-and-branch review of its culture is ongoing

“While the CBI was not previously aware of the most serious allegations, it is vital that they are thoroughly investigated now and we are liaising closely with the police,” said CBI president Brian McBride. “The board will communicate its response to this (the independent investigation) and the other steps we are taking to bring about the wider change that is needed early next week.”

Update – the ABI, Zurich and more follow suit

Zurich, Phoenix Group and the Association of British Insurers (ABI) have also announced their decision to quit the CBI. A spokesperson for Zurich UK said the insurer is “deeply concerned” about the allegations and, as such, has decided to “terminate [its] membership with immediate effect.”

A spokesperson for the ABI said: “It has become untenable to retain our membership in light of further serious allegations and we have informed the CBI of our decision to leave with immediate effect.”

What are your thoughts on this story? Feel free to share them in the comment box below.

“It’s always an exciting time to be in the insurance industry.”

During a discussion with Insurance Business, Robert Rimmele highlighted how his role within the cloud-first software and data business Ascent has showcased how the right technology partnerships can offset even the direst challenges and leverage the most promising opportunities in the insurance sector.

As co-founder of Tekaris, a German software development house which was acquired by Ascent, Rimmele has spent many years operating in the insurance and reinsurance sectors and has seen for himself the energy, passion and drive that it takes to thrive in the marketplace. For “computer guys”, he said, it’s exciting to see the interplay of information, data and insight that makes up the ecosystem – and to realise that this is all underlined by the relationships at the heart of insurance.

As a UK-headquartered business with centres in Germany, Malta, Bulgaria and Portugal, Ascent was not as impacted by COVID in the way a lot of other businesses were, Rimmele said, given that the team was used to working remotely and not allowing distance to get in the way of implementing its vision. Empathy, energy and audacity are the principles at the core of the data-first company, and it takes a combination of those elements to make partnerships work for all the stakeholders involved.

“The first and most important part of building any great partnership is trust,” he said. “What you’re looking to do is build a partnership which works but it’s also about having a shared vision of where you want your business to go within the industry. Based on that, the sky is the limit, you can do anything.”

Avoiding tech for tech’s sake

There’s no doubt that the industry is facing a brave new world when it comes to the technology and data-driven innovations that are becoming increasingly accessible. Alongside this, however, Rimmele noted that the insurance sector is also facing challenges with regards to data and AI and all the implications these bring.

“But, what the industry needs to understand is that it’s not sufficient just to have the right tools, you need to ask the right questions,” he said. “If you don’t, you’re just throwing technology around and you will spend a lot of money but it will get you nowhere. You see this, where there’s so much investment and it results in half-finished projects that are cancelled because it’s not clear why they were started in the first place.

“When it comes to data and technology, you need to already know where you want to go. At the very least, you need to have clear targets and you need to know what questions to ask and what problems you want to solve.”

The challenges facing the insurance market

For Ascent which works with a range of market players, it’s clear that each business faces its own risks and opportunities when it comes to leveraging technology. But Rimmele noted that looking at the industry more broadly, some key themes do emerge. Among them, he said, is the question of how to get the foundational piece right when building new solutions.

When trying to integrate new technologies and build the expertise required around those, he said, market players need to really understand the methodological foundations of these solutions and what they are looking to deliver. Creating that expertise around how to successfully implement a project and create positive results is a challenge for a lot of people – as is understanding how these solutions need to fit in with their pre-existing business and not operate as a silo.

“Because you discuss these projects on a technical level with tech people, you discuss them on an application level with underwriters, and you talk strategy with respective executives,” he said. “But what you need, is to be able to transcend those layers, to understand that they’re not disconnected and they need to all be brought together eventually.”

For Ascent, helping people to integrate those layers effectively is high on the agenda for 2023, and Rimmele said he is relishing the opportunity at hand to have high-level conversations with entrepreneurs and innovators across the market who want to do things differently.

“The market is ready,” he said. “Everyone is investing, everyone is aware that something has to be done. And they have a good understanding, they don’t need to wait for us to tell them what their strategy should be, they’re all clever people. So, we’re very excited to be having those conversations.”

What are your thoughts on this story? Feel free to share them in the comment box below.

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.

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

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.

What are your thoughts on this story? Share your thoughts in the comments below.

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.”

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

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.”

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