Daily Willis Review | 22 May 2018

Daily Willis Review | 22 May 2018
  • Africa Re reports growth in gross written premium for Q1 2018
  • U.S. cyber insurance market experiencing “significant growth”: A.M. Best
  • Castel Specialty launches political risk business
  • XL Catlin strengthens U.S war, terrorism and political violence team
Africa Re reports growth in gross written premium for Q1 2018
Africa Reinsurance Corporation has reported a 26.31% growth in its gross written premiums for the first quarter of 2018 from $167.13 million in March 2017 to $211.1 million in 2018.

The company said that the increase reflected a “successful” January 1 renewals combined with the “slight hardening” in the South African reinsurance market.

However, following adverse claims with several large catastrophe losses, Africa Re reported an almost break-even underwriting result, the release said.

Investment income decreased to $3.34 million in the first quarter of 2018, compared to $13.97 million for the same period in 2017.

Corneille Karekezi, General Managing Director and Chief Executive Officer, said: “The Corporation continues to show resilience even after the major losses recorded in 2017 and impacting 2018.

“The performance is in line with our forecast of a positive underwriting result year-end.”

U.S. cyber insurance market experiencing “significant growth”: A.M. Best
The U.S. cyber insurance market experienced “significant growth” in 2017, but take-up is still low, particularly among small to medium-sized enterprises, A.M. Best has reported.

In 2017, the U.S cyber premiums rose by nearly 32% year over year to $1.8 billion, and policies in force jumped 24% to $2.6 million.

The report said that the low take-up rate for cyber policies in small to medium-sized companies presents insurers with a meaningful growth opportunity.

The ratings agency also found that in 2017 cyber packaged policies in force increased 28% for the U.S. property and casualty industry, partly due to the addition of affirmative cyber coverage in commercial policies.

While systematic events remain a serious threat for cyber insurers, A.M. Best believes that underpricing from new market entrants also should remain a concern.

Bobby Skrabal, A.M. Best Industry Analyst, said: “At this point, underwriting and pricing are driven more by market forces than by loss experience and models.”

“As insurers develop more experience they’ll improve their pricing models, but due to the constantly changing nature of cyber threats, pricing will most likely continue to rely on the judgment of underwriters.”

Castel Specialty launches political risk business
Castel Specialty, a division of club-style MGA formation platform Castel Underwriting Agencies, has announced the launch of Castel Political Risk.

Castel Political Risk will initially underwrite contract frustration and political risk coverages, with a focus on business in Latin America, the Middle East and Africa.

The business will be led by Tom White, who previously served as Senior Underwriter at ANV, now AMTrust, where he had a role in establishing the political risk book.

Mark Birrell, Chief Executive of Castel, said: “Tom has both broking and underwriting expertise in this niche class.

“This experience, combined with our dedicated infrastructure support, will enable him to access the specialist brokers and markets required to build a strong-performing book of business.”

XL Catlin strengthens U.S war, terrorism and political violence team
XL Catlin has announced the promotion of Lindsey Nieves and the appointment of Jason Gardenhire to its regional U.S. war, terrorism and political violence insurance team.

Ms. Nieves assumes the role of Assistant Vice-President, Underwriting Manager for the South and Central zone in Atlanta.

She first joined XL Catlin in 2014 having previously served as a risk management specialist at American International Group.

Mr. Gardenhire has been appointed as an Underwriter in Dallas, where he will be responsible for leading the terrorism and political violence underwriting activities and manage broker relationships.

Ben Tucker, Head of XL Catlin’s U.S. War, Terrorism & Political Violence, said: “Recent events continue to drive interest in terrorism insurance and even more specialized coverage like our Active Assailant insurance coverage.”