GVNW members will have been delighted to hear Peter Zaffino, president and CEO of AIG, tell them to pick up the phone and call him and other members of his senior management team if they feel they are being denied access to real decision-makers during coming renewals.
Mr Zaffino made the commitment during a Q&A session after his presentation on Thursday evening with GVNW chairman Alexander Mahnke, who appears to have benefited from some intense media training and really grasped the art of gaining promises from senior interviewees.
German insurance managers and their leadership team at GVNW have been some of the most vocal in Europe in their criticism of the often brutal reaction of leading insurers during the recent hardening of the industrial insurance market.
Mr Mahnke has been careful to note consistently that the loss trends in key lines such as cyber and D&O clearly demanded a correction at some point. As Mr Zaffino stated during his presentation, the German risk and insurance management community is one of the most skilled and sophisiticated in the world, so understand the dynamics of this market.
But Mr Mahnke and his colleagues at GVNW were not impressed by the poor communication carried out by many leading insurers during recent renewals, which left many members scrambling desperately to complete programmes at the last minute and giving CFOs and other senior executives some nasty surprises.
This was compounded by the apparent loss of decision-making ability at local level, as leading carriers imposed strict limits on local underwriters that did not allow them to make rational risk-based decisions based on actual loss history.
Mr Zaffino admitted that the change in direction from AIG as it sought to remediate its portfolio after the long soft market had been tough, with drastically reduced limits in key lines and sectors as head office sought to reimpose control.
He said that areas such as cyber, D&O and natural catastrophe – as underlined by the recent flooding and hail losses in Germany – showed that a fundamental recalibration of the underlying risks and loss cost was needed.
Mr Zaffino said that actually, retention levels had shown that the AIG team had done a good job during this tough period, and said that his German team – under the leadership of Alexander Nagler, managing director at AIG Germany and managing director, northern Europe at AIG EMEA – had done a fine job.
But he did tell Mr Mahnke that GVNW members need to be aware that if they felt they were not gaining access to real decision-makers, then they should feel welcome to call him or other senior colleagues, including Tom Bolt, chief underwriting officer, general insurance at AIG; and David McElroy, EVP and chief executive officer, general insurance.
Mr Zaffino did point out, however, that even he has to adhere to underwriting limits, so don’t expect miracles!