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Risky Business A U.S. and Bermuda Under 40s (Re)Insurance Collaboration Inaugural Edition |
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Bermuda U40s London Tour: What goes on tour stays on tour? By Julia Mather
In October 2008, 15 members of the Bermuda U40s embarked on a whirlwind week of discovery in the City of London. The Bermuda and London insurance markets are often compared in the industry press and the aim of the tour was to introduce the group to their British “cousins” and to give those attending an overview of all areas of the London Insurance Market.
Who came? The group consisted of a great cross section of what Bermuda has to offer including brokers, underwriters, lawyers, modellers and regulators. The companies they represented were equally diverse, ranging from a multinational insurance carrier to a hedge fund backed reinsurer with a couple of energy industry mutuals, a few members of the Class of 2001 and Bermuda branches of companies that originally started elsewhere thrown in the mix. This diversity was key to the success of the tour as everyone had their own area of specialist interest. The group on tour in London were: · Julia Mather, Miller, Bermuda; · Katie Tornari, Marshall Diel & Myers; · Raymanda Davis, Oil Casualty Insurance Limited; · Melissa Flood, Argo Re; · Nikara Fraser, Endurance Specialty Insurance Limited; · Jasmine Furbert, Endurance Specialty Insurance Limited; · Carmen Gracey, Platinum Underwriters Bermuda Limited; · Lisa Horton, Axis Specialty Ltd.; · Megan Kempe, D.E. Shaw & Co (Bermuda) Ltd; · Sarah Lindo, ACE Bermuda Ltd.; · Jamie Pedro, Tokio Millennium Re Ltd; · Candace Roach, Bermuda Monetary Authority; · Robyn Simmons, Oil Insurance Limited; · Sheena Thomas, Endurance Specialty Insurance Limited; and · Gordon Cooper, Aspen Re. Itinerary We started out on the Monday morning with a visit to Lloyd’s of London. In order to put any history of the London Insurance Market into context it is imperative that you have an understanding of what Lloyd’s is and possibly, more importantly, what it is not. It is not, as many outsiders perceive, an insurance company; It is a marketplace where many companies trade. Our initial presentation taught us that after 320 years of trading, Lloyd’s has evolved from being a coffee house to being home to 51 managing agents with 80 syndicates, accepting premium volumes of approximately £16 billion. We then went to the offices of Miller Insurance Services Limited, the UK’s largest independent broker. They provided us with lunch, an opportunity to meet many of their specialist brokers and a presentation on a day in the life of a London broker, the key difference being the commute to work! In the afternoon we returned to Lloyd’s for a tour of the building which many had anticipated would be the highlight of the trip. The tours of buildings however did not end there as immediately afterwards we walked across the street to the new Willis building. On Tuesday morning, we returned to Lloyd’s where the Lloyd’s Non-Marine U30’s Group had arranged for us to shadow them. This allowed our members the opportunity to see the differences between Lloyd’s practices and their own. The most notable difference was the face to face negotiating with brokers and the smaller size risks that were accepted. That afternoon, we went to the offices of Edwards Angell Palmer & Dodge UK LLP (EAPD), an international law firm with one of the leading Insurance and Reinsurance Departments in the world. They gave presentations on the London Subscription market, Contract Certainty and the Bermuda Form. During lunch with lawyers from EAPD, it was discovered that EAPD were representing defendants in the Buncefield trial which was taking place at that time in the High Court. As members of our tour group worked for companies facing claims from that fire, EAPD arranged for us to sit in on proceedings later in the week. Tuesday evening was our “big night out”. The XL Foundation was very kind to sponsor our attendance to the James Blunt concert at the O2 Arena in Greenwich. We were joined there by members of the XL team in London and also the Lloyd’s U30’s group. Despite Mr Blunt’s own admission that his music is considered by many to be depressing, he still managed to whip up the audience into quite a frenzy and the Bermuda contingent certainly made themselves heard! On Wednesday we ventured outside of the Square Mile to another area of London known as Canary Wharf. This area has been built up over the last few decades to house the overspill from the City and is now a thriving business community in its own right. Our first port of call was the Financial Services Authority (FSA) who gave us three very informative presentations that provided an overview of: a) the FSA; b) the FSA’s supervision of the London Insurance Market; and c) their Capital adequacy regime. The FSA aims to maintain market confidence, provide the appropriate degree of consumer protection, promote public understanding of the financial system and help reduce financial crime. On Wednesday afternoon we met with Catlin UK where presentations were given by the CEO on “Lloyd’s v the Bermuda market” (which initiated intense discussion amongst the group) and the Group Claims Director on the purpose, vision, values and strategic initiatives of Catlin Global Claims Group. We ended the evening by going for a ride on the London Eye which Catlin UK generously sponsored. On Thursday morning, there was a twist in the tale. We were invited to attend the morning meeting of a company called Exclusive Analysis, who are a political risk forecasting organization that provide strategic intelligence for the insurance (and other) industries. They provide forward looking advice on War, Terrorism, Civil unrest and Political Risk worldwide. The information they provide is used by insurance underwriters to improve risk selection, minimize liability and drive new revenue and profit potential by allowing controlled market entry. The surprise here was that the majority of the group did not know beforehand that a company such as Exclusive Analysis existed. By the end of the presentation, interest was so high that there was a discussion of whether they might need a Bermuda branch. This was considered by some to be the highlight of their tour. That afternoon we headed back to Canary Wharf for a presentation by Standard & Poors. Despite recent events with the financial service industry and the appearance that rating agencies did not have their finger as much on the pulse as they perhaps should have had, the group maintained a non-confrontational stance in that we were there to learn, not to judge. During our last tour in 2006 to the US we visited with AM Best and it was most interesting to note the different approaches that both companies take to analysing insurance companies. That being said, despite their rating levels meaning different things, the Insurance Industry reads A- from both companies to be acceptable. From S&P’s viewpoint a rating of BBB- is still good for an insurer. In the latter part of the afternoon, with exhaustion setting in, we headed next door to the offices of one of the world’s leading law firms, Clifford Chance. In conjunction with Susie Wakefield of Bermuda law firm, Attride, Stirling & Woloniecki, they presented to us on the Sub-Prime Crisis. In light of the world financial meltdown, this was particularly topical and had no trouble in holding everyone’s interest. Friday morning was particularly cruel… it had been an intense week up to this point, so to arrange to meet in the reception of our hotel at 7.20am for a drive down to Kent was a little harsh on the part of the organizer. However, it should be noted that all were ready and raring to go on time as the Group all valued the time given to them by the hosts and presenters and prioritised the week accordingly. Our presentation in Kent was at the offices of Xchanging and this tied in very well with what had come before in the week. Many of our previous presentations had made reference to the use of the Xchanging services so it was a good loose end to tie up. The tour ended with a visit to the Guildhall in London, where we were given a presentation on the City of London as a Financial Centre, its history and its future. Feedback: Nikara Fraser, Assistant Underwriter, Endurance Specialty Insurance Ltd “From a personal perspective I can honestly say that this trip proved to be much more successful than I could have imagined. Initially, most - if not all of us, believed that Lloyd’s would be the climax of the trip. That was not the case. The entire experience was. Although it was a very intense week, I left each corporation feeling invigorated and anxious to learn more. I have a greater understanding of how things work elsewhere; and how different portions of the market tie together and work together. I have been deeply humbled by the events and people I met during that week. I realize now more than ever, that my knowledge of the industry is still very much in its infancy stage and I am eager to continue my journey.” Sheena Thomas, Assistant Underwriter, Endurance Specialty Insurance Ltd “After the tour I was exhausted, but feeling very honoured to have had the opportunity to attend the tour and represent Endurance. The tour was very well organized and scheduled and it was great having such a diverse group of people on the tour because we had a chance to learn how Bermuda did things compared to London. From day one it seemed as if each topic flowed into the next. Having been on the broking side, I was totally amazed at how the underwriters and brokers relationship are built on trust. It was great to see and learn how the other side of the world does business. I can honestly say that every presenter was interesting and I consider this experience to have been a once in a lifetime experience and I highly recommend it to any young person in the industry who is interested in broadening their knowledge.”
About the author: Julia was the London Tour Leader and is also the Social Officer on the Bermuda Under 40s Re/Insurance Group. She is a Director of Miller Bermuda Limited and facilitates the placing of Miller business into the Bermuda market, across all lines, whether insurance or reinsurance, property or casualty, marine or non-marine. If you have any questions you can contact Julia at julia.mather@miller-bermuda.com or +441 295 5570. |
