November 2006/3

Advent Capital Holdings has become the latest Lloyd’s (re)insurer to unveil plans for a Bermudian platform, Advent Re, which will write retrocessional business.

US giant American International Group (AIG) and CV Starr, the managing agency controlled by its former chairman and CEO Maurice “Hank” Greenberg, have settled the legal disputes stemming from the termination of their business relationship.

Liberty Syndicates - one of the largest Lloyd’s (re)insurers – has reduced its underwriting capacity for 2007 by £187mn.

Hiscox plc has become the first Lloyd’s insurer to carry out a sidecar transaction, confirming its Syndicate 33 has entered into a quota share reinsurance arrangement with $360mn Bermudian reinsurance vehicle Panther Re, a deal first revealed in the Octob

Willis Group Holdings Limited is to lose a member of its senior management as the broker confirmed that Tom Colraine is to leave the firm after 18 years.

Private equity giant 3i Group plc has hired a team led by Bruce Carnegie-Brown, the former Marsh executive who left the firm suddenly in May this year.

Lloyd’s insurer Chaucer Holdings Plc has launched a new Lloyd’s Syndicate that will provide some £75mn ($148mn) of US catastrophe capacity.

Amlin's decision to cut back on reinsurance spend appears to have paid off handsomely with the group's share price rising over 6 percent today (29 November) to a new high on the back of an upbeat trading statement today.

The Lloyd’s Corporation has brought in David Harris, a senior representative of the G6 group of London market insurers, as the three-hundred-year-old Society agrees a number of changes to improve the service it provides.

XL Capital, which announced the first of the post-Katrina sidecars Cyrus Re in November last year, has launched a new Cayman Islands special purpose reinsurance vehicle, Stoneheath Re.

UK regulator the Financial Services Authority (FSA) has fined Berkshire Hathaway subsidiary General Reinsurance UK £1.225mn for arranging two improper reinsurance transactions.

Bermudian-headquartered (re)insurer Lancashire Holdings Ltd said it is looking forward to a “healthy” 2007 in a trading statement released yesterday (21 November).

US insurer The Hartford Financial Services Group has issued a $247.5mn cat bond, Foundation II, to protect the company in the event of certain US natural catastrophe losses.

The sudden departure of HCC Insurance Holdings chairman and CEO Stephen Way has prompted a mixed approach from the two main rating agencies. While Standard & Poor’s swiftly affirmed the Houston headquartered firm’s financial strength...

RK Harrison Insurance Brokers Ltd, the independent London market brokers, will appoint the former Jardine Lloyd Thompson Group executive Dominic Collins to replace its retiring executive chairman, Richard Corfield.

Swiss reinsurer Converium’s share price continued its upward trajectory after announcing the $295mn sale of its US operations to National Indemnity last month.

US and EU Legal Developments

Despite the whispers of smooth-talking bankers, merging two insurance companies is rarely easy – and this is often multiplied in the case of Lloyd’s insurers where management egos and the existence of obdurate Lloyd’s Names add further complications.

Willis Group Holdings became the latest of the international brokers to respond to the post-Spitzer pinch, announcing the loss of 400 jobs as part of an efficiency drive on 25 October.

Finite Re spectre at Max Re; AXA securitises EUR350mn of life mortality risk; Hannover Re gets China approval for life; Oil spills after downgrade; ZFS boosts UK asbestos reserves by $500mn...

Hiscox $360mn sidecar Panther Re receives rating; Alchemy Partners looks to Lime Street for gold; R&SA in line with Q3s; buys UK agency; Endurance pulls out of offshore energy; UK trial date set for ‘Independent Three’; FSA accepts sidecar applications...

The Corporation’s chief executive Richard Ward is understood to be close to ordering a restructuring of its senior management and reporting structures, according to sources.

Despite comfortably outpacing third quarter earnings projections, Bermudian rivals ACE Limited and XL Capital met very different responses from analysts at Morgan Stanley.

While Bermudian (re)insurers uniformly booked strident third quarter results, as soaring cat rates post-Katrina combined with a virtually loss-free hurricane season...

Start-ups and pre-emptions suggest 2007 expansion

Benfield Group warned last month that trading profits are likely to be £10mn lower in 2006 than previously expected because of the loss of senior members of its facultative team to a rival firm.

Aspen Insurance Holdings – the Bermudian domiciled (re)insurer which lost three of its four underwriting heads this summer – revealed plans to leverage its balance sheet earlier this month with a $200mn hybrid offering and details of a share buy-back.

Lloyd’s gatekeeper Rolf Tolle has to tread a fine line between allowing fresh start-ups across his threshold and being too restrictive. To ensure vibrancy, the market needs fresh blood but too much can lead to downward rating pressures and excessive compe

If 2006 was the year of the sidecar, there is every sign that these and other non-traditional reinsurance vehicles will continue to emerge next year.

Fitch Ratings has decided to “set the record straight” following industry criticism that rating agencies are putting pressure on (re)insurers to diversify.

There are still hurdles to be overcome – not least the threat of awkward policyholders. But the structure of the landmark $7bn deal should see off threats

Munich Re, the world’s second largest reinsurer, raised full-year earnings forecasts and announced a EUR1bn share buy-back – its first ever, equivalent to 3.4 percent of its share capital – as it became the latest industry carrier to benefit from benign c

AIG beats earnings forecasts American International Group (AIG), the world’s largest insurance company by value, unveiled strong third quarter results on the back of a benign 2006 claims environment.

Marsh Inc’s chief executive Brian Storms parted company with another senior executive early in November as the broking giant announced it was to make its President William (Bill) Malloy redundant.

It took 18 months for ACE Ltd to persuade the Pennsylvania Insurance Commissioner to approve the sale of its asbestos riddled Brandywine subsidiaries, so R&SA shareholders might be in for a long wait before they see their US legacy business spun-off.

Chaucer Insurance Holdings plc is in talks to launch a new Lloyd’s syndicate with the former QBE Limit underwriter, Mark Harrington.

Bermudian (re)insurer Everest Re Group faces the prospect of a downgrade from Standard & Poor’s (S&P) after the rating agency revised the outlook on its AA- rating from stable to negative on 13 November.

Creditors for all 16 of the participants in the proposed WFUM pool scheme of arrangement met in London on 27 October.

Speculation that UK broker Jardine Lloyd Thompson Group plc was considering a strategy of focussed regional growth was quashed at the end of last month when the company announced a major restructuring that includes greater integration of its two separatel

USI Holdings’ admission at the end of October that it was mulling a private equity buyout offer reflects a growing interest in the broking sector from the investment community.

AXIS Capital Holdings Ltd confirmed earlier this month that John Charman, its founding president and chief executive, will sell down his holdings in the company for personal reasons.

Sean Dalton and Andrew Elliott, the former managing director and head of underwriting at one of Lloyd’s largest (re)insurers Liberty Syndicates, are planning to form a new syndicate, The Insurance Insider can reveal.