April 2012/4

Global broker Willis has turned its disappointing full-year 2011 fortunes around by posting overall organic commission and fee growth of 2 percent in Q1 2012 and an operating margin of 31.3 percent.

Bermudian (re)insurer Axis Capital has reacted to the brutal global catastrophe losses last year by slashing its catastrophe reinsurance underwriting during Q1 by more than 40 percent.

New York-listed Tower Group's £38.6mn injection into Lloyd's insurer Canopius to finance its proposed acquisition of Omega takes the US insurer one step closer to having an established presence within the Lloyd's market.

Everest Re continued the theme of outperformance during the early Q1 reporting of Bermudian (re)insurers, with quiet cat activity helping the firm beat the street.

In a developing theme among early Q1 reporters, Arch Capital posted strong net earnings, boosted by low cat losses and reserves releases.

Significant reserve releases and a quiet quarter of cat activity helped short tail specialist reinsurer Montpelier Re highlight the likely reversal in fortunes of cat-focussed underwriters during the first quarter of 2012, as the firm reported analyst beating earnings on a combined ratio of just 59 percent.

Global (re)insurer Ace reported analyst-topping results for the first quarter of 2012, with benign weather leading to fewer cat losses and one-off investment gains boosting results.

WR Berkley chairman and CEO Bill Berkley has argued that the US insurance industry is not in a hard market, highlighting excessive competition and irresponsible reserve management from certain companies as brakes on earnings recovery in the sector.

Shareholder proxy firm ISS is once again wielding its power by advising stockholders in Tower Group to vote against the US insurer's executive compensation plan at its upcoming 3 May annual meeting.

London-quoted insurance services provider and run-off investor Tawa completed its acquisition of Hamburger Internationale Rück (HIR) last week after receiving the necessary regulatory approvals.

The share price of Randall & Quilter (R&Q) weakened after the firm's full-year results release last week contained a technical loss of £4.7mn, which was due to a previously announced £13.5mn goodwill impairment.

The trustee liquidating failed brokerage MF Global has announced plans to pursue a lawsuit over a dispute with the firm's UK division over the rights to $700mn of customer funds.

Randall and Quilter (R&Q) has denied a reinsurance liability linked to its 2006 acquisition of R&Q Re - formerly known as Brandywine - from P&C insurance giant Ace and said the ongoing dispute is likely to intensify.

Hartford has been ordered to credit $24mn back to 300,000 accidental death and dismemberment (AD&D) policyholders in New York following a settlement with state regulator the New York Department of Financial Services (DFS).

All of the managing agents at Lloyd's have now passed the test for the Society's new claims regime that became effective at the start of the year.

The EU has cracked down on Guernsey's zero-10 corporate tax regime branding it as "harmful", this follows a similar ruling on zero-10 tax codes in Jersey and the Isle of Man last year.

The Federal Insurance Office (FIO)'s report on modernising US insurance regulation - which is already three months late - could be delayed further until after the presidential election in November.

The New York Federal Reserve last week began seeking bids for some of the collateralised debt obligations (CDOs) it owns in its Maiden Lane III vehicle due to its bailout of American International Group (AIG) in October 2008.

International financial regulators are not interested in hearing arguments that attempt to differentiate the (re)insurers from their cousins in the banking sector, executives were told at a London 100 working group on regulation.

With 2011 being the worst year on record for insurance cat losses, 2012 is a "very good moment" to start investing in insurance-linked securities (ILS), according to Clariden Leu's head of ILS investments Michael Stahel.

Secondary cat bond pricing fell 2 percent in the first quarter of 2012 as an active new issuance pipeline and selling pressure pushed the market down, according to Aon Benfield Securities.

Swiss Re is seeking $150mn of cover for US and European windstorm with its latest cat bond offering, Mythen Re, sister publication Trading Risk revealed last week.

Amid the current drive from UK politicians to encourage more women into the boardroom, the listed Lloyd's insurers are looking somewhat unreconstructed.

Companies are more likely to form new captives onshore in the US or the EU instead of opening in offshore locations, according to Marsh's 2012 Captive Benchmarking Report.