Corporate Round Up

Torus continues European growth path with acquisition of Starr renewals rights. Torus, the fast growing international specialty insurance group that was launched in 2008, has announced further expansion of its European business through the acquisition of the renewal rights of Starr Syndicate 1919’s Continental European Marine, Casualty, Financial Lines and General Property business. The business will transfer to Torus Syndicate 2243 at Lloyd’s, with effect from January 1, 2012. Both Torus Syndicate 2243 and Starr Syndicate 1919 are managed by Starr Managing Agents Limited, also a member of Starr Companies.hide“The agreement enables Starr to focus on expanding our operations in rapidly-growing marketplaces around the world. While Europe remains important to Starr, Latin America and Asia are expanding significantly and are opportunities to leverage our relationships and expertise,” said Steve Blakey, Head of Starr’s International Insurance Operations. “Our clients will experience no disruption; they will benefit from the same strong team of underwriters and claims handlers under the continued supervision of Starr Managing Agents Limited,” said Chris Hancock, Active Underwriter for Starr Syndicate 1919 and Torus Syndicate 2243. As part of the agreement the majority of the continental European-based employees will transfer from Starr Underwriting Agents Limited to Torus Insurance Marketing Limited, which is an authorised cover-holder on behalf of Syndicate 2243. Torus will also be appointed as cover-holder for Syndicate 1919 by Starr Managing Agents Limited which Torus said will ensure that all relevant business previously insured by Syndicate 1919 and the business being renewed into Syndicate 2243 will be handled by the same underwriting and claims teams in Paris, Cologne, Rotterdam and Milan. “Today’s announcement further underlines Torus’ commitment to becoming a leading specialty insurer through strategic growth in key markets worldwide, as well as our stated commitment to the development of our Lloyd’s platforms,” said Clive Tobin, Torus Group Chief Executive. Torus announced its first big expansion in Europe last spring when it acquired the business of Glacier Insurance AG, a subsidiary of the Swiss-based Glacier Group which brought a specialty portfolio of aviation, space, property, energy, war and terrorism and marine risks. More recently, Torus confirmed in late September that it had entered into an agreement with Clal Insurance Enterprises Holdings Limited to acquire London-based Lloyd’s Syndicate 1301 and its corporate members Broadgate Underwriting Limited and Broadgate Underwriting 2010 Limited. Subject to approval by Lloyd's, the acquisition will enable Torus to write specialty business in Lloyd’s as of January 1, 2012. At the time Mr Tobin said that this move was ‘an important milestone’ for Torus. “With the acquisition of Broadgate the key global platforms required to achieve our strategy of building a leading specialty insurer are essentially now in place,” he said. Broadgate specialises in a range of niche short tail business across several product lines, including accident and health, property direct and facultative, property treaty, specie, property schemes and bloodstock. And midway through last month the insurer announced the appointment of Brian Byrnes as Senior Underwriter for general property and Marco Sonntag as Senior Underwriter for casualty. Based primarily in Torus’ Cologne office, Torus said that Mr Byrnes and Mr Sonntag will lead underwriting for their lines for the Austrian, German and Swiss markets. Despite the still highly competitive market for corporate insurance business in Europe, Torus believes that the desire among buyers for a more diversified panel of insurers will help it to grow its business profitably. Richard Etridge, Chief Operating Officer of Torus International, said: “The current competitive market has created a dynamic environment with clients re-evaluating their panel of insurers to bolster stability and ensure risk programmes meet their specific needs. For newer, more flexible carriers with the drive and expertise on board to respond, these factors provide a real opportunity to establish viable, long-term platforms in Europe.” Dermot O’Donohoe, Chief Executive of Torus International, added, “Torus strategy for sustained growth in Europe is to add value to customers though offering specialist expertise and unique solutions. This approach is proving particularly successful with sophisticated buyers.” Mr O’Donohoe said that the young group’s growth strategy is definitely more based on acquisition than organic growth. This makes a lot of sense in such a competitive market when fresh capacity is not really needed for now and at a time when values are low and good deals can be had for those with capital. “We will continue to look for opportunities to buy things that are accretive to the business, take out existing books and teams rather than seek to add new capacity to the market. So 2012 is all about consolidation as there are few opportunities for organic growth in this market. Basically about 50% of our premium in 2012 will be based on acquisitions and so we will not be adding capacity to the market as such as that would simply serve to further soften the market,” he said. “The key point is that there is good value to be had in this market without starting from scratch. There is still a lot of capital in this market but there is also plenty of capital seeking to exit. Often it is not so easy especially with valuations so low currently and prices below book value generally speaking but good value can be found such as our acquisition of Glacier last year and Broadgate,” continued Mr O’Donohoe. Acquisitions aside, he said that Torus will continue to develop its European business using its branch network in Cologne, Paris, Amsterdam and Zurich. “In particular we see opportunities in professional indemnity and D&O in Europe,” said Mr O’Donohoe. But Torus is not limited to growth in Europe as it seeks to rapidly establish itself as a quality option for international insurance buyers. It is keen to also spread its wings further in the US as well as South America. “We are looking for an acquisition in the US. We have had a look at a few possible companies and were outbid on a few but the potential is certainly there. We are not looking at Asia currently but do see opportunities in South America. We have a license in Brazil and there are a lot of good opportunities in the construction business there particularly, though we are not looking to grow rapidly there, more a modest expansion. Watch this space. One suspects Torus will be popping up in the news more frequently in 2012. AXA Global P&C appoints new chairman and CEO François Pierson, a member of AXA Group’s Management Committee and Chairman & CEO of AXA Global P&C is to retire at the end of 2011. He will remain a director of several AXA Group companies, and Chairman of AXA Corporate Solutions. Jean-Laurent Granier, Chief Executive Officer of AXA’s Mediterranean & Latin America region and a member of the group’s Executive Committee, has been appointed Chairman and Chief Executive Officer of AXA Global P&C and will join AXA Group’s Management Committee. He will also oversee AXA Corporate Solutions. Nicolas Moreau, Chief Executive Officer of AXA France and a member of the group’s Management Committee will take on the additional responsibility of overseeing the worldwide operations of AXA Assistance and AXA Global Direct. He will also be proposed to become chairman of AXA France Board. Swiss Re sees positive insurance market outlook after 2012 Swiss Re’s economists have said that the environment for the insurance industry remains very challenging but they expect a more positive outlook, particularly after 2012. This is the main finding of Swiss Re’s latest publication Global insurance review 2011 and outlook for 2012 and 2013, presented at the Swiss Re Economic Forum in London. The insurance industry has successfully restored its capital base to a higher level compared to the beginning of the financial crisis. Large catastrophic losses, but also low investment yields, will lower profitability this year, and weak economic growth in the mature markets will constrain life and non-life premium expansion, said the reinsurer. But, said Swiss Re, non-life profits will improve again after markets harden, probably late next year. Premium growth for both life and non-life will grow in 2012 and further increase in 2013. Growth in emerging markets for both the life and non-life industries is expected to be in the range of 7–9% for 2012.

Corporate Round Up

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