week commencing 10/05/20:

Tales of rate rises dominated this week, with all parties violently agreeing that not only has Q1 seen an uplift, but that this will continue for the foreseeable future.  The bad news of course is that losses are mounting even as we take the first tentative steps toward lifting the lockdown.


Positive news included…

Reinsurers look for rate hikes at 1/6

April reinsurance renewals saw Munich Re increase its exposure to the Japanese market. For June 1 and July 1, all the ‘big four’ reinsurers are said to be looking for significant rate rises driven by COVID-19 uncertainty. External-link. [Insurance Insider]


Prices rise across the spectrum

Marsh published its latest Global Commercial Insurance Pricing Index which revealed average price rises of 14% across all lines of business between January and March this year, with D&O prices up 100%. External-link. [Marsh Global Pricing Index] Meanwhile, Lloyd’s CEO John Neal said the size of firms’ COVID losses would inevitably lead to upwards pressure on pricing in the coming year. External-link. [Insurance Insider]


Aon sees opportunity for more strategic view of risk

CEO Greg Case believes risk will become a core focus for C-Suite executives following the global pandemic. External-link. [Insurance Insider] AIRMIC CEO Jon Ludlow warns boards will view insurance options with caution. External-link. [Insurance Day]


Chinese companies look to D&O cover for safe harbour

There has been a rush by Chinese companies to buy D&O cover for executives in 2020 as the Chinese government steps up its crackdown on corporate misbehaviour. External-link. [Financial Times]


State backstops for pandemic cover

The EU insurance watchdog (EIOPA) has said that any future pandemic will need insurance solutions provided by national governments working collaboratively with the industry. External-link. [Reuters] This week the UK government made its move to backstop trade credit following the example set by France, Germany and Canada. External-link. [Insurance Business]


Ki follow syndicate sets standard for the market

With the launch of Brit’s new digital syndicate Ki, based on an algorithmic model created in partnership with Google, their CEO believes Ki demonstrated the only cost-effective option for Lloyd’s follow syndicates. External-link. [Law 360]


Aegis expands executive team

Aegis London has announced two new appointments, hiring Katie Wade from ERS to become its new CFO and AXA XL’s Rhic Webb as General Counsel and Company Secretary. External-link. [Reactions]


Several negative stories unfolded this week…

Insurance profits to dip until 2021

Fitch Ratings has published its view that insurers are unlikely to see profits in 2020 as a result of the virus, with the impact of nine successive quarters of rate rises being wiped out by pandemic impact. External-link. [Asia Insurance Review]


Syndicate cuts continue

Lloyd’s has seen more syndicates exit lines of business this year, as it continues its remedial work; although some syndicates are now starting to look for accelerated growth. External-link. [S&P Global]


Covéa walks away from PartnerRe

The unprecedented change in market conditions caused by coronavirus has led Covéa to pull out of its planned $9bn acquisition of PartnerRe. External-link. [Insurance Day]


Lloyd’s sets out $4.3bn cost of coronavirus

Lloyd’s is expecting to pay $4.3bn in claims as a direct result of coronavirus.  However, analysis reveals a total expected insurance loss of over $200bn when all factors, including investment losses, are taken into account. External-link. [Insurance Business]


And finally….

EC3 will become less of a focus in future

Liiba CEO Chris Croft believes hugely expensive EC3 offices may become a thing of the past for many firms, with electronic placement now the reality in the market. External-link. [Insurance Day]


Developed world insurance needs to adapt

Insurance growth is stagnating, with more cover needed for cyber, supply chains and pandemics and less for traditional risks, such as fire. External-link. [McKinsey]


Banks set standard for return to work

As trading has to be conducted on site for monitoring purposes, banks are leading the way in pioneering antibody testing, temperature scanning and office space restructuring – setting the standard for others to follow. External-link. [Financial Times]


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