3 Things – Latest E&S Movements, Products Filling Voids & Earnings Roundup

Hi Friends! It was another busy week, and on Monday we paused to honor our Veterans. We are grateful for all of their sacrifices to provide the life we have to live today. Meanwhile, this week, earnings are starting to wind down, but there were reports from international (re) insurer groups on the first 9 months, along with others. In addition, we followed the latest specialty / E&S movements, including acquisitions and strategic maneuvering/investments.  Product launches and partnerships also continue to be regular occurrences among the headlines. Let’s explore the three things we learned this week.

Latest E&S Movements: Acquisition and Investments

The specialty and E&S market remains a constant area of interest. A notable acquisition and other investments highlight the space’s ongoing growth trend, which shows no signs of slowing down.

Bishop Street Underwriters, a RedBird Capital Partners portfolio company, has acquired Ethos Specialty’s Transactional Liability unit, adding Representations and Warranties (R&W) and Tax insurance to their portfolio of specialty MGAs. This acquisition aligns with Bishop Street’s strategy to partner with skilled insurance professionals and adds $300 million in total premiums to their top line.

Bridge Specialty Group is unifying its London-based entities—Lonmar Global Risks, Decus Insurance Brokers, and BdB—under the new brand Bridge Specialty International. Tim Coles, CEO of Bridge Specialty International, emphasized the vision of creating a formidable force in the London and international markets through this strategic alignment.

James River Group has concluded its year-long strategic review, deciding against selling the company. Instead, it has secured additional external investment and enhanced coverage for adverse developments in prior business. CEO Frank D’Orazio stated that these actions aim to address legacy balance sheet issues and de-risk the organization, positioning it to capitalize on the robust E&S underwriting environment.

The Fortegra Group, a global specialty insurer, has secured $150 million by issuing 9.25% Fixed Rate Resetting Junior Subordinated Notes due 2064. This funding is intended to deepen partner relationships by offering tailored insurance solutions, enhance Fortegra’s financial flexibility, and support its ongoing growth initiatives.

Ascot, a Bermuda-based global specialty insurance group, has received a minority investment from BellTower, a private equity firm. This strategic partnership aims to enhance Ascot’s financial flexibility and support its growth ambitions in the expanding global specialty (re)insurance market. Despite this new investment, the Canada Pension Plan Investment Board will continue to hold a significant majority ownership in Ascot.

Products and Partnerships Filling Voids

Technology-enabled products and specialty property remain active, with new product launches and partnerships showing the industry’s focus on changing its focus to cover emerging risks. While some companies are moving in, others, like Progressive, are diverting away to focus on their strengths while leaving the void to be filled by new entrants.

Crum & Forster has introduced FInTECH ONE, an integrated errors and omissions (E&O) insurance solution tailored for financial technology firms. Policyholders gain access to CFcyberASSIST.com, Crum & Forster’s cyber risk management portal, which offers resources such as executive tabletop exercises, incident response plan reviews, and phishing awareness training.

Emerald Bay Risk Solutions has partnered with Vanderbilt Properties Associates, Inc. to introduce a premium casualty insurance program tailored for luxury residential and commercial real estate properties. This collaboration aims to provide customized insurance solutions that address the unique risks associated with high-end real estate assets.

Southlake Specialty Insurance Company, a fronting operation specializing in program-focused property and casualty insurance, has partnered with Accelerant. The partnership aims to enhance the efficiency and effectiveness of specialty underwriting by leveraging Accelerant’s data-driven approach and Southlake’s expertise in program-focused insurance.

Progressive has announced it will discontinue offering dwelling fire insurance, commonly known as landlord insurance, for non-primary residences and rental properties. This decision allows Progressive to concentrate on owner-occupied homes and bundling home and auto insurance policies. The company remains committed to the homeowners insurance market and will continue to offer homeowners, renters, condo, flood, and umbrella policies.

In related news, Safeco Insurance will take over Main Street America’s personal lines renewal business after Main Street’s recent decision to focus on commercial lines. The transfer covers policies like auto, home, and renters, expanding Safeco’s reach in 22 states and reinforcing its personal lines portfolio.

Earnings Roundup: Swiss Re, SCOR, Allianz and Others

A large portion of insurers have reporting their Q3 results but this featured multi-national (re) insurance groups along with US entities who are all demonstrating positive performance and growth.

Swiss Re reported a net income of $2.2 billion for the first nine months of 2024, achieved despite a $2.4 billion reserve strengthening in its Property & Casualty Reinsurance segment. The company’s robust underwriting performance and investment results effectively offset these additional reserves.

SCOR reported a net loss of €117 million in Q3 2024, primarily due to a negative insurance service result in its Life & Health (L&H) reinsurance segment. This downturn overshadowed the strong performance of the P&C segment, which achieved a combined ratio of 88.3%.

Allianz reported robust financial performance in Q3 2024, with net income attributable to shareholders reaching €2.5 billion, up from €2 billion in the same period last year. This 25% increase was driven by a 14% rise in operating profit. The property and casualty division contributed significantly, benefiting from lower natural catastrophe claims.

Ambac Financial Group reported a significant increase in its specialty P&C production for the third quarter of 2024. This figure represents an 86.2% rise compared to the same period in the previous year. The growth encompasses gross written premiums from Ambac’s fronting company, Everspan, and premiums placed by Cirrata, their growing MGA segment.

Aspen Insurance Holdings reported strong Q3 2024 results, with underwriting income of $47.9 million, reversing a $70 million loss from last year. The primary insurance segment also saw growth, reaching $615.2 million. Aspen’s combined ratio improved significantly to 95.6%, reflecting better underwriting discipline.

Join us as we continue to explore the headlines and news shaping the insurance sector, and stay tuned for more insights on the unfolding narrative of our industry!  Stay productive, stay safe and stay in touch!