Risk managers watch nervously as Zurich merges Global Corporate with commercial, Hürlimann steps down

The overall insurance and reinsurance market may currently be awash with capacity following the arrival of billions of dollars of capital market investment in search of uncorrelated returns in the low interest rate environment. But there are few truly global insurers that can support risk managers at multinational companies as they seek to build truly compliant and effective international programmes.

Zurich’s dedicated Global Corporate business has invested heavily in this area, not least through its Multinational Insurance Application (MIA) database. According to one leading Netherlands-based risk and insurance manager, there is now fear that focus will be lost in this critical area as the group embarks on a new strategy.

As part of the shake up at Zurich, Thomas Hürlimann, former head of the corporate operation, will be replaced by James Shea. Mr Hürlimann will step into a consulting role for new group CEO Mario Greco.

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Mr Hürlimann survived recent big changes at the Swiss group. These included the replacement of former group CEO Martin Senn by Mr Greco earlier this year after the insurer announced serious losses, largely generated by its North American corporate business.

Zurich then sadly announced at the end of May that Mr Senn had committed suicide at the age of 59. This followed the suicide of chief financial officer Pierre Wauthier in 2013. “Zurich clearly has to get back on track but I am not sure that this is the right decision to merge the corporate and commercial businesses,” the Dutch risk manager told Commercial Risk Europe yesterday.

“Also losing Thomas Hürlimann is a big blow for the industry as a whole. He is really a visionary, has experience and understands customer needs. This is very unfortunate. Of course we will support James Shea, but risk managers are worried about what is happening at Zurich currently. It has been a very good and reliable partner over the years and innovative with initiatives such as MIA. We must hope that they keep the focus on the global corporate business,” he added.

The risk manager said the arrival of big reinsurers such as Munich Re, SCOR and Swiss Re in the global corporate business is good news and adds quality capacity. But there are very few “serious partners” left, he added.

Zurich of course put a much more positive spin on the news. It said it had decided to combine corporate and commercial businesses into a single unit to “simplify” and “strengthen” the organisation. Canadian Mr Shea joins Zurich as CEO Commercial Insurance from AIG where he was president of global financial lines.

Zurich also announced that it has created a new global specialty lines function within the commercial insurance business that will include areas such as political risk, surety and trade credit, marine, aviation and energy.

The insurer said that Mr Hürlimann had decided now is the right time for him to step down after a decade at Global Corporate. “Thomas will work closely with James Shea to ensure a smooth transition and then continue to work on special projects reporting to the group chief executive officer,” stated the group.

Mr Greco said: “Combining our corporate and commercial businesses will allow us to better utilise our skills, systems and capabilities in the individual countries and across the world, and to unite our customer interaction and go-to-market approach worldwide. James’ in-depth market knowledge and extensive expertise make him the perfect match to lead this exciting new venture.”

He added: “I want to thank Thomas for his excellent contribution and loyalty to Zurich since joining in 2003, and his dedication to developing Global Corporate into the first address in risk management for multinational companies.”

Zurich’s board of directors also appointed Mr Shea, Claudia Dill, who is CEO in Latin America, and Jack Howell, CEO in Asia Pacific, as members of its executive committee.

This completes a transformation that began in June. The executive committee now also includes Jeff Dailey, CEO Farmers; Mike Foley, CEO North America; and Gary Shaughnessy, CEO EMEA. Four other committee members represent the group’s core central functions. These are Urban Angehrn, Chief Information Officer; George Quinn, Chief Financial Officer; Cecilia Reyes, Chief Risk Officer; and Kristof Terryn, Chief Operations Officer.