July 2009/2

Following the strong recovery in the investment portfolio of its parent, Berkshire Hathaway Reinsurance Group has regained some of the catastrophe appetite it trimmed in the first quarter of the year, but not at current prices.

Aon's UK arm is lobbying the Financial Services Authority (FSA) to clarify its stance over the transacting of overseas business, amid concerns that a two-tier regulatory system may be developing.

American International Group (AIG) returned to the black as it booked its first quarterly profit since Q3 2007, largely driven by a significant drop in net realised losses.

Former American International Group (AIG) CEO Maurice "Hank" Greenberg will pay $15mn to settle past accounting issues relating to the company, reports suggest.

Hannover Re unveiled an ostensibly strong set of half-year results, with net profits up 66.1 percent to EUR419mn.

Global insurer Zurich Financial Services Group (ZFS) has completed its search to replace its highly regarded chief executive James Schiro.

UK insurer RSA saw its first half net profit decline 24 percent to £223mn, but the figure was nevertheless in line with analysts' expectations under the current economic conditions.

Barnabas Hurst-Bannister, chairman of Travelers Syndicate Management and deputy chairman of the Lloyd’s Market Association (LMA), has been named as the new chairman of the London Market Reform Group (MRG), succeeding Peter Harmer...

Marsh's single-minded focus on cost-cutting has again borne fruit in its quarterly earnings, with its operating margin leaping from 10.6 percent to 18.2 percent in the second quarter.

Despite a strong showing by its core property casualty business that included a better-than-expected combined ratio of 89.4 percent, Swiss Re fell back into the red for the second quarter, as worse-than-expected mark-to-market losses and writedowns return

Soft market conditions in the US property casualty insurance market show little sign of abating, according to the latest data from Texas-based insurance exchange MarketScout.

Hardy Underwriting posted an upbeat half-year statement that included significant top-line growth, as it offered a pragmatic but optimistic assessment of future pricing prospects.

Bermudian Max Capital Group saw its second quarter net income drop to $42.8mn compared to $74.2mn in Q2 2008, in part driven by a higher loss ratio and acquisition expenses in its property casualty business.

Bermudian reinsurer Flagstone posted robust second quarter results, booking a net income of $67.8mn, compared to $41.9mn in Q2 2008.

Bermudian reinsurer Everest Re saw second-quarter net income increase 78 percent to $272.6mn, compared to $153.0mn for Q2 2008, after being helped by higher premiums written and an increase in the fair value of its equity portfolio.

Axis Capital's president and CEO has berated the insurance market for lacking the courage to force through rate rises, as the Bermudian (re)insurer saw its second quarter profits drop from $231mn to $159mn.

Munich Re unveiled solid net profits of EUR703mn for the second quarter, up 11.9 percent on the prior-year period, as its primary division, ERGO, returned to the black.

White Mountains Insurance Group is restructuring its reinsurance business by converting its Bermudian reinsurance arm into a branch of White Mountains Re Sirius.

Canadian combine Fairfax Financial Holdings turned a net profit of $275.4mn for the second quarter, compared to just $27.6mn in the prior-year period, as it returned to underwriting profit in its (re)insurance operations and booked strong investment gains

Gallagher's Global Energy initiative took another decisive step this week with news that the firm has opened a Calgary office, The Insurance Insider can reveal.

Jardine Lloyd Thompson (JLT) impressed analysts with strong half-year figures, posting a 16 percent increase in turnover to £309.7mn, fuelled by organic growth that averaged 5 percent across divisions.

Aon and Willis reported flat and 1 percent organic revenue growth respectively in their core business for the second quarter, as a lingering soft market and difficult economic conditions combined to produce a challenging climate for the broking giants.

French reinsurer Scor’s net income for the first six months of the year dropped by 24 percent from H1 2008 to EUR184mn, as investment income dropped from EUR348mn to EUR 149mn.

The Risk and Insurance Management Society (RIMS) has expressed "disappointment" and "concern" at the decision to allow broker AJ Gallagher to begin accepting contingent commissions again.

The House of Lords ruled that London-based facultative reinsurers Wasa International Insurance Company (Wasa) and AGF Insurance Ltd are not obliged to follow a settlement made in a US court.

Bermudian (re)insurer Aspen saw its net income drop from $126.9mn in the second quarter of 2008 to $110.4mn in Q2 2009, while its combined ratio jumped 8.9 percent year-on-year to 87.7 percent.

Validus Holdings saw net income climb by $61.6mn or 81.2 percent year-on-year to $136mn for the second quarter, as it benefited from strong net unrealised investment gains.

Joe Plumeri, chairman and CEO of broking giant Willis, has reiterated his firm's strong opposition to charging contingent commissions and stated that if the New York attorney were to re-enable the arrangements, Willis would not participate.

Brit Insurance Holdings said it was enjoying organic growth in its three main trading divisions while again reassuring investors on the development of its sub-prime/financial liability exposures.

Despite the Willis Group more than doubling second quarter net income from $39mn to $87mn, the sluggish performance of the firm's North American business highlighted the difficult conditions faced by brokers in the US insurance market.

Hannover Re's latest catastrophe bond, Eurus II, closed yesterday (29 July), providing the reinsurer with EUR150mn of European windstorm cover and taking overall 2009 cat bond issuance to $1.8bn.

Parkton Re Ltd, the cat bond put together for North Carolina's state wind pool, has become the latest 2009 issue to upsize as it increased from a planned $125mn to $200mn on closing.

The big three global brokers have all seen their stocks trade upwards today following news that AJ Gallagher will be permitted to again enter into contingent commission arrangements from 1 October.

The news this morning that AJ Gallagher has amended its deal with the Illinois regulatory authorities to enable the firm to again start charging contingent commissions is good news for the big three global brokers.

A trio of Bermudian (re)insurers – RenaissanceRe, Montpelier Re and Endurance Specialty Holdings – booked higher Q2 net income bolstered by reserve releases and improving investment conditions.

Lancashire Holdings expressed surprise at the markedly reduced demand for Gulf of Mexico (GOM) energy wind cover it experienced in the second quarter.

AJ Gallagher has struck a deal with the Illinois regulatory authorities that will enable the US broker to again accept contingent commissions, signalling the strongest challenge yet to the so-called Spitzer legacy.

Fast-expanding insurer Torus Holdings has appointed Naveen Anand – CNA Insurance’s former senior vice president of commercial insurance – as global chief operating officer.

RK Harrison has said that the Lloyd's broker Bowood Holdings, which it acquired in October 2008, will become the group's specialist delegated authority broker from 1 October this year, operating under the name Bowood Insurance Brokers Ltd (BIB).

A US federal judge has upheld a jury verdict in favour of United National Insurance Company (UNIC) in a reinsurance spat with Aon Ltd and added $8.3mn in prejudgment interest to the amount the jury awarded to take the total payout by the broking giant to

Bill Berkley, the CEO of US specialty insurer WR Berkley, is confident the sluggish US P&C markets are close to turning as the firm posted its second quarter results.

The liability claim from the Tupolev Tu-154 passenger aircraft that crashed in north-western Iran on 15 July, killing all 168 on board, is currently estimated at up to $55mn, The Insurance Insider understands.

Transatlantic Re saw its book value per share increase 6.9 percent in the second quarter to reach a high of $53.47 at June 30.

The vagaries of financial accounting standards produced contrasting results for ACE Ltd and PartnerRe.

A major report on the competitiveness of the UK insurance industry has not called for a reduction in the tax burden, despite acknowledging that firms are relocating offshore.

AIU Holdings will operate as Chartis, after the commercial insurance giant announced a rebranding and took a step closer to independence from its beleaguered parent American International Group (AIG).

Beazley plc has launched the Lloyd’s interim reporting season with a fall in pre-tax profits from £45.0mn in the first half of 2008 to £20.1mn, as the expected unwind of last year’s foreign exchange gains hit the bottom line.

IPC Holdings has reported bumper Q2 net income of $173.9mn, compared to $47.5mn for the same period a year earlier as operating earnings stabilised and a net loss on investments of $50.9mn swung to a gain of $77.4mn.

Bermudian Arch Capital followed its compatriot Platinum Underwriters in booking a solid set of Q2 figures as its bottom line benefitted from improving investment conditions and healthy reserve releases.

London market broker RFIB Holdings has announced the appointment of Marshall King as CEO.

Scor has snapped up the US life reinsurance operations of XL Capital for total consideration of EUR31.7mn cash.

UK regulator the Financial Services Authority (FSA) has fined London-based HSBC Insurance Brokers £700,000 for not having adequate systems and controls in place to protect its customers' confidential details from being lost or stolen.

Platinum Underwriters Holdings kicked off the Bermudian Q2 reporting season with a solid set of figures that included a record $1.90 net income per share, as improving investment conditions and reserve releases boosted its results.

A second suit filed on behalf of investors against Willis arising from the global broker’s role as insurance intermediary for Stanford International Bank (SIB) has alleged that the firm would, at SIB’s request, produce personalised “safety and comfort”...

A high-powered City working group co-chaired by the Chancellor of the Exchequer Alistair Darling and Aviva’s CEO Andrew Moss is set to avoid calling for direct changes to the UK’s tax regime which has seen an exodus of Lloyd’s insurers...

Canadian combine Fairfax Financial Holdings Ltd has made a recommended offer to buy up the remaining shares in its majority owned Lloyd’s (re)insurer Advent Capital Holdings plc.

The Hartford Financial Services Group has moved to bolster its depleted senior management resources with the promotion of Juan Andrade to head up its property casualty operations.

A dissenting minority of US policyholders have delayed the proposed scheme of arrangement for Audley Gilroy-owned discontinued insurer Scottish Lion, and a UK court stayed proceedings until 8 January 2010, The Insurance Insider can reveal

With 2009 looking set to be another year without pronounced market-wide rate increases, US property casualty (P&C) insurers could soon be seeing the end of bumper reserve releases propping up financial results...

US pension fund giant the California Public Employees' Retirement System (Calpers) has sued the big three ratings agencies over the rating of structured investment vehicles (SIVs) relating to sub-prime mortgages.

American International Group (AIG) is accelerating steps to position its American Life Insurance Company (ALICO) subsidiary for a spin-off, as it continues to assess strategic options for the US life business, which may yet lead to a trade sale.

Jardine Lloyd Thompson (JLT) is set to continue the expansion of its aviation practice as it moves to hire three senior brokers from Aon, The Insurance Insider can reveal.

Omega Insurance Holdings has been endorsed by AM Best with an affirmation of the ratings on its Lloyd's and Bermudian operations, as the agency highlighted the group's strong capitalisation.

The General Insurance Corporation of India is on the slip for the Tupolev TU-154 passenger aircraft that crashed in northwestern Iran, killing all 168 on board, The Insurance Insider understands.

Former Arch Insurance Company (Europe) president and CEO Bob Van Gieson is joining Hyperion's underwriting agency Dual International as chairman and chief executive.

Lloyd’s insurer Ark Syndicate Management has entered the contingency market with the appointment of former Miller Insurance contingency broker Dan Goggin...

Insurance cuts could cost £1bn; Max picks up Ace duo; JLT hires Aon deputy chair; Omega promoted; Cooper Gay edges closer to IPO; CV Starr launches Lloyd’s US construction consortium; Jacko loss to be modest; JLT acquires Tysers US D&O; Catlin leads...

Equitas, the $7.8bn legacy albatross that has hung around the neck of Lloyd's Names ever since its creation in 1996, can now be formally detached...

After a US federal jury ruled that Starr International (SICO) did not misappropriate assets from an American International Group (AIG) trust set up to compensate senior AIG executives, Maurice “Hank” Greenberg is now awaiting...

Less than two years after a bitter dispute with Berkshire Hathaway's Gen Re, Arch Capital Group is again being hauled into court to defend allegations of orchestrated staff poaching.

Private equity-backed Integro Insurance Brokers turned its cash flow positive for the first time last quarter.

A look at the history books reveals that when a financial institution collapses, litigators often turn on the professional services firms it has used in search of restitution.