Insurance news

BMS Group, an independent insurance and reinsurance broker, has announced the appointment of Hannah Watkins to the role of UK chief growth officer. Effective immediately, Watkins will operate out of the London office, reporting to Ian Gormley, the CEO of BMS Group UK.

In her new role, Watkins will be responsible for leading the firm’s client-first growth strategy, coordinating BMS’s business origination strategies across London. This coordination is vital as it aims to not only bolster the UK market but also support the company’s objectives in the US and other international markets. Watkins will also lead efforts to reinforce the company’s cultural ethos and strengthen relationships with carriers to enhance BMS’s position in the global market.

Watkins has served at BMS for over 12 years, joining the company as the director of risk solutions. Her most recent position was as managing director at BMS Re. Prior to joining BMS, she served as an associate at Jardine Lloyd Thomson Group and Glencairn, each for six years.

“Hannah has been a cornerstone in the development of our growth narrative and a key architect of our client-first culture,” Gormley said. “Her comprehensive experience across specialty insurance, delegated markets, and reinsurance makes her the ideal leader to integrate our operational strengths and drive our growth initiatives.”

“Having been part of BMS for 13 years, I am both honoured and excited to step into this role,
 Watkins said. “Our clients are the core of our business, and I am deeply committed to enhancing our impact on their enterprises, their communities, and the broader market. This role offers me an incredible opportunity to further champion our team’s efforts and spearhead our strategic growth.”

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RenaissanceRe Holdings Ltd. has released its financial results for the second quarter of 2024. The company reported a robust net income available to common shareholders of $495 million, demonstrating a strong financial position. Operating income was $650.8 million available to common shareholders.

The firm realized an annualized return on average common equity of 21.4% and an operational return on average common equity of 28.2%. These figures are indicative of RenaissanceRe’s effective capital utilization and its proficiency in generating profitable outcomes from its equity base, the company said.

During the quarter, the company saw gross premiums written surge by 29.2% from the second quarter of 2023, adding up to an increase of $773.9 million. This growth was driven by gains across major segments: property premiums rose by 25%, contributing an additional $350.5 million, while casualty and specialty premiums increased by 33.9%, adding $423.4 million.

The company also reported a combined ratio of 81.1% and an adjusted combined ratio of 78.6%.

RenaissanceRe actively engaged in share repurchases during the quarter. The company repurchased $108.5 million of its common shares and continued its shareholder return strategy into July, buying back an additional $61.2 million of shares.

In addition, the company experienced a surge in fee income, which climbed by 48.3% to $84.1 million, and a substantial rise in net investment income, which increased by 40.4% to $410.8 million.

Kevin J. O’Donnell, president and chief executive officer, attributed the quarterly performance to strong execution across the company’s diversified business lines and strategic asset growth. He specifically noted the ongoing benefits from the acquisition of Validus, which he said continues to deliver substantial growth in premiums and invested assets, contributing positively to the company’s performance in a favourable business environment.

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As the school term begins in South Australia, RAA Insurance urges parents to ensure their children’s laptops, tablets, and other technology items are adequately insured.

Data from RAA Insurance revealed that 37% of its contents insurance policyholders do not have accidental damage cover. This lack of coverage could leave children’s devices unprotected if they are damaged or stolen while at school.

Annually, the insurer processes more than 7,000 claims related to accidental damage.

“Parents spend a lot of money on laptops, tablets, and phones for their kids’ schooling and may not be certain if their insurance policy covers these items if they’re lost, stolen, or damaged while at school,” she said.

She advised parents to contact their insurers to determine if their home and contents insurance extends to children’s valuables outside the home, including during commutes to and from school.

“A quick phone call to your insurer could give you that peace of mind to know you won’t be significantly out of pocket if something goes wrong,” she said. “If you want to check whether school items are covered, you can ask your insurer if your policy already covers them or if you need to take out optional cover such as accidental damage.”

State data from 2018 to 2022 shows 263 child pedestrian injuries or fatalities, with 124 of these incidents occurring during school pick-up and drop-off times. The peak period for these incidents is between 3pm and 4pm, with additional high-risk times from 8am to 9am and 4pm to 6pm.

The RAA also reported 44 road fatalities and 434 serious injuries in South Australia during the first half of 2024.

“Young people walking to school are our most vulnerable road users, and it’s concerning to see 124 children have been injured or have lost their lives at school pick-up or drop-off times between 2018 and 2022,” said Matt Vertudaches, a senior traffic engineer at RAA.

Customer experience is firmly in the insurance spotlight as the first anniversary of the Consumer Duty rules approaches and organisations across the sector take stock of their impact.

Data released earlier this month by the Chartered Insurance Institute (CII) indicates a growing divide between consumer expectations and their experience with insurers, a gap at its widest since the CII launched its Public Trust Index in 2029. The index also noted the ongoing dip in consumer confidence in insurers, with respondents highlighting how insurers could improve in handling claims professionally, fairly and efficiently. This was further cemented by the findings of the consumer advocacy group Which?, raising concerns about how insurance claims are being handled by providers.

Harnessing the power of broker feedback

The challenge at hand is clear – insurers need to put the right foundations in place on which to create improved customer experience strategies. But what do those foundations look like? Drawing on the CII’s research, it seems the answer is to be found in the insurance broking community, given that professional brokers were found to outperform price comparison websites, banks, building societies and insurers when it comes to building customer loyalty and confidence.

No customer experience strategy can afford not to base itself on the feedback of the brokers who have their ear to the ground on how to deliver the best possible outcomes for insureds – so what do brokers have to say?

High-quality products and ease of doing business

Front of mind for the broking community today is the demand for high-quality, accessible insurance products. Brokers want the confidence to know that when they recommend a policy for their clients, they’re working with tested and assured, highly rated products and solutions that will deliver at the point of claim.

Closely linked to that is the demand for increased ease of doing business. As to how insurers can meet that demand, Rob Fairs, product and channel management director at RSA, noted that two core components require addressing – reducing friction and creating accessible communication channels. Looking at RSA’s e-trade platform, he noted that the insurer has made significant investments to create meaningful, iterative changes to the platform to create a clear underwriting strategy.

“What that means is driving less friction in our business and enabling brokers to spend more time with their customers actually adding value as opposed to administration,” he said. “In our market, we have over 1.5 million inquiries every year. And therefore, when something refers, as a business, we want to be very targeted about that so that we’re able to win it.

“That leads on to the second part around ease of business, which is when we do have referrals and there’s contact between us and our brokers, we have to be on our game in order to drive outperformance in terms of customer experience. And we recognised the need to do that from our broker feedback.”

There are numerous ways an insurer can look to drive that outperformance – including increasing its number of underwriters, simplifying communication channels and building out individual product teams, backed by underwriting licenses. By increasing these underwriting licenses, you can ensure that when a broker speaks to an underwriter, they have immediate access to expertise and can expect a first-time resolution.

Pricing, data and strong relationships

Particularly amid the current economic environment, pricing remains a significant consideration for brokers – and whether the proposition on offer works as a whole for the insured. 

At the core of getting pricing right is data, as it’s only through the rigorous use of high-quality data that you can ensure you’re delivering the best possible coverage at the best possible price. “As you start to increasingly focus on driving the best possible outcomes for customers, you see that you have to have data at the heart of what you do,” Fairs said. “Data is key to driving successful business models, both for brokers and insurers. And I really feel there’s a market opportunity for us to differentiate ourselves by enhancing the data we use to make data-lead decisions to drive business outcomes.”

Relationships are the heart of how the insurance industry operates, and to keeping those front-and-centre means insurers can’t afford to take a ‘once and done’ approach to seeking out broker feedback. It is only by engaging with brokers, and getting their insights into what’s working and not working in terms of product, pricing and consumer confidence in digital channels, that insurers can put those insights into meaningful action. 

For Tovah Grosscurth, commercial lines digital director responsible for RSA’s SME and eTrade business, talking to brokers on the ground has given her confidence that the market is moving in the right direction.

Brokers are a great source of feedback, because they’re vocal about where they want to see improvements, she said, but also on where they have seen improvements. Genuine collaboration is what’s required to move the dial on customer experience in insurance and also to make sure that companies don’t become too internally focused when they’re looking to deliver a transformation strategy. “It’s about getting the balance right,” she said.

The Clear Group (Clear) has announced its acquisition of Maynard Milton Insurance Services LLP’s (Maynard Milton) book and assets.

Founded over three decades ago, Maynard Milton operates as a £4.9 million gross written premium broker in Southend-on-Sea, Essex. The firm is recognised for its strong position in the local market, particularly in the fleet and property insurance sectors.

The Clear Group acquires Maynard Milton’s book and assets

Post-acquisition, the entire team from Maynard Milton, including partners Martin Maynard and Kevin Milton, will integrate into the Clear Group.

This strategic move aims to bolster the group’s presence in the region, complementing its current operations in Shoeburyness.

Commenting on the deal, Mike Edgeley (pictured), group CEO of the Clear Group, highlighted Maynard Milton’s consistent growth and profitability over the years.

“We are delighted to welcome the Maynard Milton team to Clear. This is a well-run and profitable business which has a track record of delivering year-on-year growth. It’s another example of how Clear is able to invest in regional brokers while adding scale and expertise to our client proposition,” he said.

Kevin Milton, co-founder of Maynard Milton Insurance Services LLP, said the Clear Group aligns with their values, particularly placing clients at the heart of the business.

“Our team has worked hard to build a successful brokerage, so it was important that we found the right home to serve our clients moving forward. In [the] Clear Group, we saw a business which shared our values for placing the client at the heart of its proposition. We are now looking forward to working closely with our new colleagues at Clear to continue to provide our clients with the best possible service and products,” he said.

This acquisition is part of the Clear Group’s broader strategy to expand its footprint and capabilities in the UK insurance market. It follows the group’s acquisition of the book and assets of Rycroft Associates LLP (Rycroft Associates), which includes Inspire Credit Management Limited (Inspire Credit Management).

The deal, announced last month, aims to enhance the Clear Group’s commercial solutions as insolvencies in the UK hit a 30-year high.

The insurance industry is no stranger to conversations about the growing talent gap impacting the financial services sector – and the challenge to recruit and retain top-tier talent, particularly as technological advancements reshape what it means to work. There’s a range of factors underpinning this gap including competition with other industries, shifting demographics creating an ageing workforce, and limited awareness of what it means to work in insurance.

The perception issues surrounding the industry are of particular concern, as many people have a limited understanding of what insurance actually does and the diverse career opportunities a career in insurance can provide. The work of industry associations to provide education and outreach to schools and colleges is moving the dial, as recently seen by the successful return of the London Market Group’s ‘Futures Academy‘, but what can individual insurance companies do to secure a sustainable talent pipeline?

Changing perspectives on insurance careers

The scale of the challenge is thrown into relief by how few people working in the market actively chose a career in insurance. Offering her own experience as an example, Nikki Lister, head of SME trading at Zurich in the UK, noted that she started her two-decade career on the phones at one of Zurich’s contact centres. “A lot of people, me included, tend to have stumbled into insurance and realised what an amazing career it can be,” she said.

At the time, she was taking a gap year and planning to take up a place at university to become a teacher, Lidster said, but what started as a temporary job soon blossomed into a career that has been, “a privilege and a joy”. Her experience of the industry and the wealth of opportunities it represents has made her a passionate advocate for drawing talent into the marketplace and opening up those opportunities to people from all different walks of life.

Why insurance needs to adapt to changing employee requirements

There’s a range of different strategies which can be utilised to make insurance a career destination of choice – from attractive compensation and benefits packages, creating new mentoring and networking opportunities, and making the right investments in technology and innovation. Underpinning each of these, however, is the need for insurance to adapt to changing workforce needs by prioritising the employee well-being considerations that have arisen in a post-COVID world.

For Zurich, this has included the rollout of a flexible working campaign, which Lidster noted has been very successful in the SME business, where 18% of its workforce now work either part-time or flexibly. “Being able to bring that to life in the interview process has been really important,” she said. “We absolutely see it as our responsibility to attract talent and retain talent through meaningful career paths. We see it as vital to our success – but also to the success of our wider industry, because this is a people-focused industry.”

What is a healthy talent recruitment and retention strategy?

A healthy recruitment strategy centres on a keen understanding of your value proposition, which for Lidster’s team centres on delivering a strong service proposition. Its recruitment strategy looks to focus on that service element and on finding individuals with the right transferable skills to work in a customer-facing role.

“They could be either in their early careers or during career changes at different times in their life,” she said. “We’ve got examples of people that have joined us from coffee shops, flight attendants, bar staff, retail workers etc. and we’ve also had some who had caring responsibilities in the past. We’re basically looking for people who pride themselves on delivering excellent customer service, love working in a fast-paced environment, are really good communicators and can demonstrate a desire to learn.

“We can teach all the technical elements of insurance, but what we’re really looking for is the right behaviours. Then once they’re in, dependent on their experience, we can support them either through an apprenticeship or the cert CII route. We’ve had 70 new starters in the last year which is due to the growth of our business and some of the great internal moves we’re seeing in the business.”

Getting the right people in the door is the first step but keeping them is where the real work lies. The key to getting that piece right is ensuring that they’re equipped with the right support and training. It is only by harnessing the expertise of experienced colleagues to work with new recruits through their induction that you build a high-quality team, empowered to support brokers and clients from the get-go.

“We delivered 40,000 hours of training last year in SME,” Lidster said. “A lot of that was to our new starters, but it was also on cross-skilling our existing underwriters on products. That enabled us to award 150 new underwriting authorities last year, enabling our underwriters to really support the broker demand, whether that’s on the phone or on live chat. It’s about empowering our people to become the decision-makers able to resolve that query as quickly as possible for the broker in that moment when they need us most.”

Global natural disasters have caused more than $117 billion in economic losses for the first half of 2024, a report published by global professional services firm Aon found.

Aon’s “Global Catastrophe Recap: First Half 2024” report noted that the total was notably lower than the $226 billion in economic losses recorded in the first half of 2023. It was also lower than the 21st century first half average, which was $137 billion.

The report, which was published by Aon’s Impact Forecasting team, also found that the recorded global insured losses for the first half of the year were at least $58 billion. This was higher than the 21st century first half average of $39 billion but was lower than what was recorded in the last three years, which exceeded $60 billion by the end of June.

The report further found that the total number of fatalities caused by natural catastrophe events was estimated to be more than 6,000, which was the lowest recorded number since 2020. The insurance protection gap was also estimated to have lowered to 50%, which was caused by the elevated insurance payouts for US severe convective storm (SCS) damage.

“It is great to see a lowering of the global protection gap, which is a result of the high levels of insurance coverage for the SCS events observed in the first half of 2024,” said Michal Lörinc, head of catastrophe insight at Aon.

“However, the re/insurance industry needs to continue its efforts to increase levels of insurance in emerging markets, through provision of not just capital and capacity, but also advanced data and analytics, which help to qualify and quantify the risk, and ultimately shape better decisions.”

The report further found that natural disasters in the US accounted for almost 80% of the global insured losses in the first half of 2024 as it reached nearly $46 billion. There were 30 economic loss events in the first half of the year that cost more than $1 billion. About 22 of them occurred in the US, two in South America, four in Asia, and two in EMEA.

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Global reinsurer PartnerRe has entered into a strategic partnership with Banyan Risk, a specialty managing general agent, to write excess casualty insurance, subject to approval by the Bermuda Monetary Authority.

Under the collaboration, PartnerRe will provide capacity and shareholder support for the launch of a new subsidiary called Banyan Excess Liability Ltd. (BELL). It will be based in Bermuda and sit under the Banyan Risk Ltd operation with a sole focus on excess casualty insurance.

BELL will be led by Alan Rodrigues, who was appointed CEO. He will be responsible for providing client solutions to the excess casualty market, which currently faces a challenging environment.

Rodrigues will build out a local team in Bermuda, reporting to the BELL board of directors.

Rodrigues brings to the role nearly 40 years’ experience in excess casualty, with oversight of billions in gross written premium.

Prior to joining BELL, he served as executive underwriting officer for casualty, leading Markel Specialty’s broad casualty business, including the Bermuda market.

Previously, he spent 13 years at AXIS Capital in London, Bermuda, and the United States. He also has a 16-year experience with General Star Management, a general reinsurance company.

Rodrigues began his career at Safeco Insurance in 1985 as a casualty underwriter.

His new responsibility, BELL, marks an expansion into a new Banyan product line, following the 2021 launch of Banyan Risk Services Ltd. In Canada.

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It’s a volatile time for the UK cyber insurance market, which saw double-digit rate drops continue in the first quarter of 2024, marking the second consecutive quarter the market experienced rate reductions to that extent.

However, there’s a contradiction at the heart of the increasingly ‘buyer-friendly’ nature of the market amid the reality that cyber threats remain significant and insureds are continuing to experience large ransomware and privacy losses.

Offering his insight into what’s happening, Gareth Bateman (pictured), cyber growth leader at Marsh in the UK, highlighted that these softening market conditions started gaining traction in the tail-end of 2023. “The trend has continued into this year with rate reductions, opportunities for buyers to reduce their retention, with most buying increased limits because they’re keeping the spend the same with rates coming down and so are reinvesting in increasing the size of their programme. It is a bit of paradox because, in the threat environment, we’re not seeing any letup at all.”

What’s underpinning the current environment?

Two key considerations are driving the current market environment – an abundance of capacity and intense competition among insurers, and the strengthening cyber risk management of UK companies. On the latter, Bateman noted that over the last couple of years, understanding of what controls are needed to defend against ransomware attacks, and what constitutes good cyber hygiene and maturity has proliferated throughout insureds, creating a better risk pool.

“Candidly, the biggest driver at the moment is competition between insurers,” he said. “Most of them are perceiving a rate environment that’s adequate for the risk so they want to write more business. Almost all of the 50 or so insurers in the UK market are hungry at the same time and they’ve got broad appetite. Programmes are over-subscribed, and the pricing environment is something which insureds are focusing on, which is driving competition in terms of rate.”

Creating a sustainable cyber insurance ecosystem

While it’s easy to dismiss competition as being healthy for a marketplace, Bateman emphasised the need for current market conditions to start levelling out if the cyber insurance sector is to be sustainable in the long term. From working closely with clients and having insight into their buying habits, he said, it’s clear that they want predictability and sustainable rates. What’s worrying him and his team is that some of the renewals which have registered double-digit percentage savings might not be available next year.

Rapid spikes, in either direction, of premium are not a sign of a stable or a sustainable market – and it is sustainability that clients are looking for, and which the insurance market should be looking to deliver. With regards to the long-term sustainability of the market, Bateman noted that while he doesn’t expect to see an erosion of the sector’s capital base, it undermines the credibility of the market to have significant volatility year after year.

That’s particularly true for a product which is a discretionary spend, he said, and it’s accentuated by the fact that a lot of businesses are still trying to understand cyber risk in the context of their own organisation. Even if they operationally understand what technology or data will knock out their operations if it’s compromised or encrypted, the next challenge is trying to quantify that knowledge in terms of its impact in dollar terms. That’s where having the right expertise and the right tools is critical because it enables clients to visualise their risk environment and loss profiles in a meaningful way. 

“Generally, there is a recognition across businesses that they need to get to this stage in order to understand what risk management strategy is the most appropriate,” he said. “Because until you quantify it, it’s very hard to make decisions and to prioritise.”

Opportunity in the cyber insurance market

The level of cyber awareness and hygiene differs substantially depending on what segment of the market you’re assessing. In heavily regulated or consumer-facing sectors, whether that’s pharmaceuticals or financial institutions, there’s a high penetration of cyber insurance because ever since the rollout of GDPR, they’ve understood the need to protect against data breaches. However, when you look at the smaller, mid-market segment, penetration rates remain perilously low.

For Bateman and his team, that’s where the real opportunity resides for the cyber insurance market – and brokers in particular – to shine. They have spotted real room to grow in that segment, and to build and develop a new customer base, rather than just looking to sell more coverage to existing customers.

It’s a very difficult conversation, he admitted, because these organisations are often going through a budgeting cycle that might take nine months. With the rate environment being what it is, it will probably be completely different at the end of that cycle, making it very difficult for the risk manager to have the right conversations with the CFO, and the CFO can’t have the right conversations with the board. But these conversations do need to be had regardless because cyber is a mission-critical risk.

Taking Marsh’s statistics as a bellwether for the wider market, it’s interesting to see how the book is growing.

“In some regions like Latin America and some parts of Asia, we are seeing increased flow of business, where there’s obviously adoption going on,” he said. “But even in the UK market, the opportunity is still significant in terms of new buyers. I think the recognition of cyber risks is growing.

“So, there’s a market of buyers who recognise the risk, and there’s a market ready to offer it which is hungry for the premium. It comes back to that credibility point – about communicating the breadth of the product, creating greater transparency and trust, and creating greater stability in the pricing environment.”