The Intelligent Quarterly from the publishers of The Insurance Insider

Summer 2018

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A touch of class

MS Amlin is the lead insurer on a $25mn marine war loss from a ship sunk off the coast of Yemen in October.
Sources told sister publication The Insurance Insider that the loss related to a United Arab Emirates-registered aluminium catamaran-style vessel named the HSV-2 Swift, which Houthi rebels in Yemen claimed to have hit with an anti-ship missile on 1 October.
The policy was 100 percent placed via a Marsh marine war facility in Dubai.
It is understood MS Amlin, Talbot, Ironshore and Munich Re underwrote the risk. The loss is understood to be the largest to hit the marine war market for several years.

A spate of algae infestations that killed millions of salmon and tuna will see London market underwriters take a share of a $45mn bill.
A trio of losses originated in Mexico and Chile as a result of harmful algal bloom events, in which algae populations quickly accumulate and generate toxins that can kill off entire fish farms.
A portion of the losses were reinsured into Lloyd's through an Alwen Hough Johnson consortium called Global Aquaculture Insurance and Company.
London-based (re)insurers Novae, Sompo Canopius Re, Tokio Marine Kiln, MS Amlin, Ascot, Sirius, Chubb, Aegis, ANV and Swiss Re Corporate Solutions are all understood to be part of the consortium.

New cyber security regulations from New York State's Department of Financial Services may heighten the stakes for directors' and officers' coverage providers, according to Fitch Ratings.
The regulations, which took effect on 1 March, require an executive or a director at a covered firm to annually certify compliance with the rules, which apply to a variety of financial services businesses, including insurers.
"If management and directors of financial institutions that experience future cyber incidents are subsequently found to be non-compliant with the New York regulations, then they will be more exposed to litigation that would be covered under professional liability policies," Fitch said.

Allied World is moving its aviation book and underwriters onto the platform of Dubai-based managing general agency (MGA) Elseco.
Sources told The Insurance Insider that Allied World's aviation specialist Olivier Marre will primarily write airline business through the Elseco platform, with a launch being targeted before 1 April.
The Dubai-based MGA is looking to secure capacity to support a $150mn line size, although it will also attempt to grow beyond this level in time as it seeks to build lead capacity.
Elseco already writes a general aviation account, and had a maximum capacity of $10mn for hull and $100mn for liability in 2016.

The upstream energy market has settled a major construction claim related to the faulty Big Foot platform in the Gulf of Mexico for $550mn - far less than first feared.
Lead insurer Munich Re Underwriting struck the deal at the outset of the year, with carriers agreeing to pay out $550mn to the Chevron-led joint venture. Mexican state-owned energy company Pemex and its insurers have also settled a claim relating to an April 2015 platform fire for $650mn, bringing the loss in just below the reserve currently held by the market.
The loss had initially been notified to the market by broker Marsh at $670mn-$780mn, but in March last year Pemex revised this upwards and sought to claim the full $1.3bn policy limit on its programme.

The rising frequency and severity of US auto claims hit carriers' fourth quarter and full-year 2016 results.
Liberty Mutual posted a 31.6 percent drop in Q4 operating income to $359mn, primarily due to increased losses in its US personal and commercial auto liability book. Meanwhile, US mutual giant State Farm reported a $5.5bn underwriting loss for 2016 after claims and expenses from its auto book outstripped premiums by $7bn.
And Maiden Holdings reported a Q4 loss of $69.7mn (Q4 2015: $26.4mn profit) after a pre-announced reserve charge mostly related to auto insurers.

This article was published as part of issue Spring 2017

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