July 2013/3

The Insurance Insider tracks all the notable P&C sector share prices of the last week and compares year-to-date performances as of week ending 12 July 2013.

Pricing commentary from US P&C carriers in Q2 earnings calls will be scrutinised for signs that momentum on rates in some classes of business is coming under pressure after Willis said it expected softening in property through the second half of the year.

On the same day that former New York attorney general Eliot Spitzer tried to stage a political comeback, his old adversary Maurice "Hank" Greenberg sued the politician for a "long-standing malicious campaign" to discredit and defame him.  

The US administration has asked a federal judge to prevent Ben Bernanke testifying in court to answer Maurice "Hank" Greenberg's claims that the government treated American International Group (AIG) shareholders "punitively" when it bailed out the insurance giant in 2008.

A Texas state court has thrown out Lance Armstrong's claim that a prize insurer's $3mn fraud suit against him was time-barred.

A senior executive at UK composite insurer Aviva has warned the UK's nascent Financial Conduct Authority (FCA) to "really think about proportionality and priority-setting".

The Financial Services Authority (FSA) meted out a record £423mn in financial penalties in its final 12 months as the UK regulator - more than five times the £76mn in fines handed to errant firms and financiers the previous year.

The UK's Financial Conduct Authority (FCA) is weighing up stiffer penalties for senior insurance executives who act irresponsibly, the regulator's chairman John Griffith-Jones has warned.

Andrew Bailey, the CEO of the UK's Prudential Regulatory Authority (PRA), has indicated that he now broadly supports the Solvency II proposals relating to long-term liabilities.

Regulators from the G20 countries will this month unveil a list of insurers deemed "too big to fail", which will face tighter regulation and capital surcharges to limit the economic fallout if they go bust.

Start-up insurance-linked securities (ILS) fund manager Stone Ridge Asset Management has invested a significant sum in Swiss Re's Sector Re sidecar, according to a half-year report filed last week with the Securities and Exchange Commission.

Nine months after the devastation inflicted by Superstorm Sandy, the New York Metropolitan Transportation Authority (MTA) is gearing up to issue the first cat bond to cover storm surge.

Capital market interest is pouring into the facultative markets as it has into the property catastrophe markets, GC Fac's head of US facultative risk John Trace said at a recent roundtable hosted by sister publication Inside FAC.

Cat bond sponsor American Family Mutual Insurance and service companies PCS and AIR Worldwide are being sued by liquidators of the insurer's Mariah Re bond in a $100mn dispute that calls into question their handling of the industry loss-linked deal.

The $100mn+ loss of the Asiana Airlines Boeing 777 that crash-landed on 6 July will do little to relieve the downward rating pressure exerted by abundant capacity and subdued claims, according to two influential aviation market brokers.

Analysts at KBW have added further weight to the growing chorus of industry observers predicting that diminishing reserve redundancies will lead to increased pressure on earnings at commercial insurance carriers.

Torus' bottom line is expected to improve as the firm gains access to capital from its new owners Enstar and Stone Point and is freed from the start-up capital charges imposed by ratings agency AM Best.

Torus' struggling US operation is the obvious target in the global specialty insurer's imminent legacy and live carve up after its new owner confirmed last week that it will be putting parts of the business into run-off.

Following its sale to Enstar and Stone Point, Torus has lost its group CEO Clive Tobin, a former XL senior executive who transformed the firm from a start-up energy specialist insurer to a multi-platform global player.

The management of Enstar Group took the stage last week to explain the vision driving its rapid change of business strategy after securing a number of deals to bolt on live businesses to its leading run-off acquisition operation.

Losses attributed to the recent flooding across Central Europe have now exceeded $1.5bn following a series of loss estimates from major (re)insurers last week

The bulk of the insured loss from the devastating train disaster earlier this month in Lac-Mégantic, Canada looks set to fall on local carriers, with the impact on international markets limited to $25mn, industry sources told The Insurance Insider.

London market executives, the majority of whom are clamouring for one of their own to be named as Richard Ward's successor, will be scrutinising the appointment of headhunting firm Odgers Berndtson for signs of the likely outcome of the search.

Simon Hearn, one of the headhunters who led the search for the last CEO, believes that Lloyd's should look beyond the London market to figures in the insurance industry with global experience.

Contrary to the prevailing perspective in the market, Hiscox CEO Bronek Masojada does not feel that Richard Ward's successor as CEO of Lloyd's has to be a figure with direct experience of the London market.

Sir Elton John's management company is set to file a multi-million dollar claim with London market insurers that participate on a contingency policy affected by his recent illness and concert cancellations.

Peter Murphy, the final member of the AmTrust Europe team that undertook a bold play into the Italian medical malpractice market, has resigned his position at the firm, The Insurance Insider understands.

QBE Europe's imminent reorganisation is likely to see Lloyd's veteran Colin O'Farrell promoted to head of international wholesale operations, The Insurance Insider understands.

The share price of London-listed closed pension fund consolidator Phoenix leapt by 10 percent late last week after it confirmed it had entered merger talks with Swiss Re.

AJ Gallagher, Aon and Towergate are on the shortlist of potential buyers for UK broking consolidator Giles, The Insurance Insider revealed last week.

Generali downgrade; XL leads Canadian train cover; Losses flood in; Rowell departs; Torus under review

For London market technology watchers used to a decades-long line of blind alleys, false dawns, near misses and general frustration, the recent news that global broker Marsh has stopped using the (Aon-supported) Qatarlyst electronic placing platform will have caused little surprise.

The exodus of Alterra executives following its takeover by Markel earlier this year has continued apace, significantly shrinking the management structure at the former Bermudian (re)insurer, The Insurance Insider can reveal.