UPFRONT
UNDERWRITING AGENCIES UPDATE
M&A DEALS DOWN, REPORT SAYS A global law firm’s recently released report shows insurance companies are looking for growth by alternative means
The number of completed M&A transactions in the global insurance industry has fallen. According to Clyde & Co’s Search for Growth report, there were 173 deals between October 2015 and March 2016, down from the 250 deals done in the previous six months. The report noted that eight of the top 10 deals in the second half of last year involved insurers in Asia. Andrew Holderness, Clyde & Co’s global head of its corporate insurance group, high lighted that while M&A remains an avenue for growth, insurance businesses are exploring alternatives, including expansion into
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new markets, broadening their portfolios and utilising new technologies. “While the appeal of M&A is clear, the challenges of finding the right target and, significantly, at the right price may cause insurance businesses to consider other routes for growth,” Holderness said. “New markets are obviously appealing. In Singapore, for example, we have seen an increase in interest from international re/insurers looking to set up shop and establish a base for wider access to markets across the region. Likewise, Miami is emerging as a regional hub for Latin
UAC looks for new partner
The Underwriting Agencies Council (UAC) recently announced its search for a new strategic underwriting partner to replace Vero. UAC says it still has the support of principal strategic underwriting partner Lloyd’s and strategic underwriting partner Hollard Insurance. In a statement, UAC chairman Lyndon Turner said, “ [D]ue to the regular enquiries we receive from the market, the board feels it only best to open a formal process of discussions with the wider market to ensure we select the best new partner to join us.”
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American and Caribbean re/insurance business – attracting a number of international players who are drawn to the city’s deep connections with, and accessibility to, the region.” Holderness said another largely untested option was entering joint venture agreements with local partners.
“The challenges of finding the right target ... at the right price, may cause insurance businesses to consider other routes for growth” “This year, foreign direct investment limits have been raised in markets such as China and India, offering foreign insurers greater access to some fast growing markets.” Holderness also mentioned the trend of larger insurers investing in technology start-ups with the aim of securing future growth. He referred to recent data from Accenture indicating that technology start-ups attracted US$2.6bn (A$3.47bn) of investment last year, a sharp increase from US$800m (A$1.068bn) in the year earlier. “Market conditions in many insurance sectors are not expected to improve in the foreseeable future,” said Holderness. “As a result, insurance businesses will need to examine every available avenue as they look for creative answers to the issues they face in the next few years.”
Three new subjects at Brooklyn Uni
Brooklyn Underwriting’s Brooklyn University has announced three new course subjects. The new subjects are Natural Catastrophes, Claims Handling 101 and Insurance Lingo. “The first claims subject … was created in response to feedback from students,” Tim Fairbrother, manager, partnerships, at Brooklyn Underwriting told Insurance Business. “The Natural Catastrophes, we think, is an area that’s … increasingly important in the world we live in.”
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25/07/2016 11:01:24 AM