Insurance news

Allianz Global Corporate & Specialty (AGCS) has appointed Anthony Vassallo (pictured above) as regional head of energy and construction of its London and Nordics regional unit. He succeeded Tracey Hunt, who has left the company.

In this role, Vassallo leads the insurer’s energy and construction business in the UK, Ireland and Nordic countries. He reports to Alfredo Alonso, managing director, regional unit London and Nordics, with an additional reporting line to AGCS’ global head of energy and construction. Vassallo continues to be based in London.

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“The home market is already a very competitive space, which keeps premium increases largely at bay,” said Harriet Devonald, product manager at Consumer Intelligence.

Younger homeowners continue to pay slightly more for home cover than their elders, but the gap is shrinking. A homeowner under age 50 pays an average of £151 for an annual buildings and contents policy, while over-50s pay £134.

Across regions, London has the most expensive average home insurance premium at £202. Only two other areas – South East (£154) and Yorkshire and the Humber (£150) – have premiums higher than the national average of £144.

The North East (£113) remains the region with the cheapest premiums, followed by the East Midlands (£124) and the South West (£130). Premiums fell across all regions, with the largest drops in Yorkshire and the Humber (-7.9%).

Older properties remained more expensive to insure than newer ones, due to the higher cost of claims made by their owners. Older properties’ roofing, plumbing, and wiring are more likely to develop faults, and replacement materials may be expensive to source.

Homes built in the 19th century/Victorian era were the most expensive, typically costing £169 a year to insure. On the other hand, properties built since the turn of the century were the cheapest at £133.

Reductions were seen across all property age segments, and Consumer Intelligence observed the largest decrease in premiums for properties built between 1940 and 1955 (-7.4%) and between 1910 and 1925 (-7.0%).

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Commercial insurance brokerage The Insurance Octopus has appointed Helen Bush (pictured above) as director.

Bush was the firm’s head of finance and support services for 11 years before taking on the most senior role at the company. According to The Insurance Octopus, Bush has had an influence over all aspects of the business, having worked at multiple departments.

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The Lloyd’s Market Association (LMA) has appointed six new board members.

The new board members are Hugh Brennan, CEO of RenaissanceRe Syndicate Management; Dominick Hoare, group CUO of Munich Re Syndicate; Kate Markham, CEO of London market at Hiscox; Chris Smelt, executive director of Managing Agency Partners; Rachel Turk, head of corporate development at Beazley, and Sarah Willmont, joint active underwriter at Canopius.

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Lara Mowery, the global head of distribution at Guy Carpenter, led the panel. She was joined by: Sebastian Cook, managing director and head of London Europe; Christopher Ross, managing director of treaty broking; Shiv Kumar, president of GC securities; Dr Jessica Turner, managing director for catastrophe advisory; and Erica Davis, managing director and global co-head of cyber.

In the briefing, Mowery claimed that reinsurers’ risk appetites and product offerings continue to evolve in response to emerging market realities. Meanwhile, differentiation remains valuable.

 “Some drivers of uncertainty are dissipating. Primary rates are stabilizing, and ample traditional, as well as alternative capital, is bolstering the sector,” she continued. “The market will continue to monitor how COVID-19 claims are resolved and how the losses of 2021 develop while also turning attention to evolving risks including cyber and climate change.”

Cook stated that the US Property Catastrophe Rate-on-Line (ROL) Index increased by 6% for renewals from January through July, around half of the increase experienced over the same period in 2020. Meanwhile, in Asia, the increase was approximately 5%.

Overall, ROL levels were impacted by several factors, including some upward shifts in retentions, particularly on loss-impacted programmes, additional limits purchased on the top end of programmes, and increased pricing.

Ross explained that multiple counterbalancing factors are impacting the marketplace, with capacity reductions, retention increases, coverage restrictions, and focus on client risk-management strategies affecting levels of rate increases.

“Engagement between all parties has been remarkable during this unprecedented period. Heading into year-end renewals, we expect this positive momentum to continue and lead to an orderly renewal period with ample capacity to support cedents’ reinsurance strategies,” Ross said.

Meanwhile, Kumar highlighted the ongoing robustness of the capital markets and the growth of catastrophe bonds over the past 12 months.

Aside from the factors mentioned above, 2021 is becoming the “year of ESG” as climate change and other environmental risks remain a key concern for CEOs worldwide regarding likelihood and their impact, according to Dr Turner. As a result, Guy Carpenter and Marsh McLennan are working with clients to help them address the broad range of ESG challenges they face.

“We are able to advise on the expectations of investors, rating agencies, and regulators with regard to ESG, identifying what good looks like and helping companies develop strategies to manage the transition toward their own net-zero targets,” Dr Turner said.

Meanwhile, Davis pointed to the growing and evolving impact of cyber risk as a further driver for change in the (re)insurance sector.

“Across the industry, loss-development assumptions for cyber risk are again being revisited in 2021 to reflect the effect of the current claims activity,” she said.

“For attritional impact, a higher propensity of cyber incidents, particularly ransomware attacks, is likely to hinder a near-term reversal of claims-cost trends. Responding to a continued uptick in both frequency and severity, this was the year for cyber underwriters to take action.”

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An example of this was recently demonstrated by the legal protection and assistance provider ARAG which extended its accreditation under ISO standards, by adding 22301:2019 to its certifications. Providing insight into what this means, Simon Barrett (pictured), chief financial officer at ARAG noted that many organisations are familiar with the ISO 9000 series of quality management systems which provide global standards that are met by more than a million certified businesses around the world.

Read more: ARAG achieves ISO certification

However, he added, there are hundreds of different ISO certifications that cover everything from food safety to energy management. In the case of ISO 22301, this certification is all about preparing a business for the worst.

“It’s rarely possible to predict what form a disaster will take, when it might happen or how long its effects might last,” he said. “The global pandemic has been the perfect example. What businesses can do is make sure they have the business continuity systems in place that will make the company more resilient and adaptable, allowing them to minimise the impact of often unforeseeable disruption. ISO 22301 specifies the requirements of such systems to ensure they are robust and up to the task, whenever it might arise and whatever form it may take.”

Examining how ARAG’s decision to undergo this ISO certification first came about, Barrett highlighted that the provider achieved the ISO 27001:2013 certification, the standard for information security, in 2015 and already had robust business continuity management systems in place. While the decision to pursue ISO 22301 certification was not entirely motivated by the pandemic, he said, its experiences in 2020 certainly provided the impetus to do it now.

“The massive organisational shift that ARAG, like all businesses, had to make in 2020 was remarkably smooth, but it underlined the importance of our business continuity management systems,” he said. “Partly because the systems worked so well under such testing circumstances, we had both the time and the experiences to reflect on the process. Rather than pat ourselves on the back for being prepared, we looked at how we could document what we had learned and where we could improve. ISO certification provides the perfect mechanism for doing that.”

ARAG initiated the company-wide project in February of 2021, he said, and achieved ISO 22301:2019 certification in June.

Read more: ARAG announces Which? partnership

Barrett highlighted the importance of firms documenting their learning and experiences when it comes to the subject of resilience and adaptability. Whatever systems or processes might already be in place, he said, there is always room for improvement. It’s impossible to predict every possible scenario when preparing a business for such events, but failing to learn from experiences and adapt plans to increase resilience could be the difference between survival and organisational failure.

“It’s vital to have a solid and tested framework, in which experiences can be documented, improvements planned and changes implemented,” he continued. “The cost of failing to do so could literally be the end of the business.”

The question of whether or not the COVID pandemic has increased the importance of this has been one raised across several industries. Offering his perspective, Barrett stated he does not believe that the pandemic has actually made business continuity planning any more important but rather that it has accelerated how important it really is. Many businesses that may not have been well-prepared will have survived the past 18 months, he said, but they will have incurred much higher costs or lost more business than they might have otherwise.

“The business world has already been transformed but the COVID crisis is far from over and who knows what other events or challenges may emerge,” he said. “Businesses that have robust, up-to-date plans are the most likely to survive, but also the most likely to thrive on the other side of a crisis.”

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Hunt started her insurance career as an account handler with Willis in 1990, before taking on a claims manager role at Lambert Fenchurch. She then joined RSA in 1998 as senior development underwriter, progressing through liability and property roles before becoming regional manager. Before taking on her current role at RSA in 2018, she served as MD of the Insurance Corporation of the Channel Islands (part of RSA Group).

Hunt replaces David Williams, MD of underwriting & technical services at AXA, in her new role as chair.

Commenting on her appointment, Hunt said she was delighted to take up the opportunity and grateful for the support of her advisory board colleagues. She said that since joining the board in 2019, she had seen SOUP create strong foundations for its members through the provision of regular guidance and insight throughout the COVID-19 crisis.

“I’ll now be focused upon building on that success by developing strategic approaches to some of the biggest issues that we face in our sector such as skills, technology and trust,” she said. “For someone entering the profession now, data analytical skills and understanding new technology are crucial to success. We also need to help customers understand the value of what we are offering and give them the confidence and trust that the insurance industry will support them when the time comes.”

Hunt emphasised the CII’s purpose – to build public trust – and said this must remain at the heart of what the institute does to ensure that customers are well served. Underwriting is a challenging and rewarding career, she said, and SOUP’s members must be provided with all the tools required to navigate the business environment and realise available opportunities.  
Sian Fisher, chief executive of the CII, added that the CII’s insurance societies are sector-specific professional communities that provide members with relevant and insightful learning.

“I have no doubt Mandy’s experience and leadership will continue to drive forward SOUP’s growing engagement with the underwriting sector,” she said. “My thanks to David, who has been an excellent chair to the advisory board. I look forward to working with Mandy and the other board members in the years ahead.”

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QBE European Operations has appointed Andy Besant (pictured above) to the newly created role of chief customer officer.

In this role, Besant will be responsible for QBE European Operations’ sales strategy, distribution, client proposition, the management and development of major trading partnerships, major client relationships, and other priority customer segments. He will report to Cécile Fresneau, managing director, insurance.

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“We are delighted to welcome Applied to the global Radar Live partner programme,” said Andrew Harley, senior director at Willis Towers Watson. “This latest partnership will enable Applied to provide its insurer partners with a sophisticated price enhancement tool, supporting pricing decisions and delivering accurate rates for the mutual benefit of all stakeholders.”

Applied also revealed that RSA Insurance Ireland will be the first insurer to connect to Radar Live via the Applied Rating Hub for real-time pricing.

“Radar Live, via the partnership with Applied, gives us an efficient way to analyse our data to support our pricing decisions and deploy them to the market,” said Trevor Lowry, chief underwriting officer of RSA Insurance Ireland. “This partnership delivers a significant benefit for brokers and their customers, allowing for more individualised pricing. We look forward to rolling out our Radar Live capability across our intermediated business and beyond.”

Radar Live is an insurance rating and rules software tool that builds on WTW’s analytical software Emblem, Classifier, Radar Base and Radar Optimise. It allows insurers and MGAs to develop rates, underwriting rules and adjustments, and deploy them directly to the market in real time.

Applied Rating Hub acts as a single point of entry to manage all rates for brokers in real time, test range changes and keep a full audit trail of all changes and quotes delivered, which can improve brokers’ control over rates and improve their speed to market.

“The insurance landscape is fast evolving and new digital-first competitors are requiring insurers to adopt new technologies that allow them to get to market more quickly,” said David McKnight, regional director, Applied Systems Europe. “Applied’s partnership with Willis Towers Watson creates a seamless integration between Applied Rating Hub and Radar Live, allowing them to quickly react to market changes and stay ahead of the competition.”

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According to IFB, the launch of the new platform is a significant development in the quest to continually evolve and enhance services in order to keep pace with fraudsters and find ways to improve the quality and timeliness of data.

IFiHub, which was launched in 2019, is an industry-scale intelligence database that helps detect suspected fraud rapidly. It allows users to share, analyse, monitor and investigate suspect intelligence data in real time.

A total of 107,000 fraud incidents are reported each year, worth around £1.2 billion, according to the Association of British Insurers. Many cases go unreported, which means the true scale of the crime is much larger. Insurers have predicted that the financial crisis caused by the pandemic will cause insurance scams to be more common, with fraudsters looking to take advantage of new technology and more people using online services.

“Insurance fraud affects thousands every year, causing considerable personal and economic loss, so it’s vital that the industry continues to work together to combat this issue,” said Ben Fletcher, director at IFB. “It’s in everyone’s interest that fraud is effectively tackled and reduced in scale, so less money is lost to the economy and insurance premiums can be lowered for all. We decided to deepen our partnership with SAS to build the new platform as they provide innovative solutions and understand the need to drive forward a better customer experience. We’re really pleased to be launching the new platform, as it’s a crucial step in evolving how we share intelligence with the industry, allowing customers to keep pace with the fraudster but also deal with genuine cases more quickly.”

“Being agile and able to evolve quickly is a major advantage that fraudsters have held over the insurance industry for years,” said Roderick Crawford, vice president and country manager, SAS UK and Ireland. “However, this new platform enables insurers to instantly match suspected fraud with similar instances of confirmed fraud, allowing for much faster and more accurate decision-making. The fight against sophisticated fraudsters will continue, and use of best-in-class technology is key to winning the battle.”

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