WINTER 2017 ISSUE 64 the Intelligent Quarterly from The
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WINTER 2017 ISSUE 64 18 Cat 22 Alt. 30 Bullish modelling reinsurance Barbican What’s in a ILS put to 10 years number? the test of specialty The intelligent quarterly from the publishers of The Insurance Insider Strong Capitalisation. Sound Solutions. Sustainable Partnerships. www.asiacapitalre.com Singapore | China | Hong Kong | Taiwan | Japan | Korea | Malaysia | Vietnam | India | Dubai | Bahrain ACRG Ad2017_v2_FA.indd 1 15/11/17 9:49 AM COMMENT WEEKENDER Once in these pages I likened Some consequences are life- the noise were convinced to join the a prolonged soft market to a house changing. The stab victim’s scar is a party and are exuberantly displaying party that gets out of hand. permanent reminder of how things the full convert’s zeal. There had been It starts off as a lot of fun, with can go badly wrong. some bickering but peacemakers everyone socialising and having a Meanwhile, unnoticed by revellers stepped in and cooled it down just in good time. The music gets turned and police alike, the guest who passed time. up louder and louder and someone out has not and will never reawaken. A pizza delivery has come and decides it would be amusing to fill the He is dead from an unspecified gone. Everyone has a full stomach and fruit punch with vodka. overdose. is happy. There are only smiles and an The more experienced take this as Everyone swears they are never overall air of contentment reigns. their cue to call it a night. going to drink again and a period of Even more curious, given the all- Once they leave all hell breaks puritanical abstinence follows. round excess, is an almost paradoxical loose. At least, that is how the moral story sense of sobriety and rationality Some surprising new liaisons used to go. about the gathering. This drug makes are cemented, some in full view of This soft market is different. This everyone appear in control. other guests and, notably, one in the time someone has put a new wonder On the pages that follow Charlie guest bedroom under a pile of coats. drug into the cocktails. It’s like rocket Thomas wonders where the missing Someone passes out in the basement. fuel and has kept the party going HIM billions are, but no one at this Later, obnoxious gatecrashers much, much longer. Miraculously, party appears to be bothered by this arrive and a knife fight breaks out. A it seems to prevent both the question. These guys are certain man is stabbed. formation of hangovers and the the numbers will either turn up The neighbours call the police and onset of fatigue. and will be easily replaced, or the party ends with a raid. The sun has come up and it will transpire they have been Seemingly oblivious to the mayhem the rave is still on. People are overcooked and therefore get a couple have a screaming stand-up dancing on the tables and chairs. written down. row in the front garden. Not a single person has crashed Either way, they think the end In the grey light of dawn the out, passed out or left for home. result is that we’ll all be back on hapless host discovers that the There was worrying moment the dancefloor before long. living room carpet is covered with at 4am when the police came An online re-stocking of the cigarette burns and red wine stains. and banged on the door. But MARK liquor cabinet is on its way. The Smashed ornaments and crockery are they were sent on their way with a GEOGHEGAN crowd is invincible. It looks like we Managing everywhere. combination of charm and guile. director, could be in for a weekender. The hangovers are brutal and the Nothing is going to stop this. Insider Monday is a very long way away. contrition is long-lasting. Neighbours who had complained of Publishing What could possibly go wrong? www.insiderquarterly.com 03 INSIDE CONTENTS IN THE WINTER 2017 ISSUE MANAGING DIRECTOR Mark Geoghegan [email protected] EDITOR-IN-CHIEF Adam McNestrie [email protected] EDITOR Laura Board [email protected] US EDITORIAL DIRECTOR David Bull [email protected] US EDITOR Ted Bunker [email protected] MANAGING EDITOR Charlie Thomas [email protected] NEWS EDITOR Catrin Shi [email protected] FEATURES EDITOR Gavin Bradshaw [email protected] SENIOR REPORTERS Fiona Robertson [email protected] Dan Ascher [email protected] Lucy Jones [email protected] REPORTERS John Hewitt Jones [email protected] Bernard Goyder [email protected] Sofia Geraghty [email protected] RESEARCH ANALYST Iulia Ciutina [email protected] COMMERCIAL DIRECTOR Spencer Halladey [email protected] SALES DIRECTOR Rob Hughes [email protected] BUSINESS DEVELOPMENT MANAGER Benjamin Bracken [email protected] SALES EXECUTIVE Annie Lightholder [email protected] HEAD OF EVENTS AND MARKETING Jennifer Lord [email protected] BUSINESS DEVELOPMENT EXECUTIVE 10 Sophie Jansen [email protected] MARKETING EXECUTIVE Beatrice Boico [email protected] 03 Comment: 18 Poles apart CONFERENCE PRODUCTION MANAGER Weekender Why were modelled estimates of Matthew Sime [email protected] HIM industry losses so diverse? EVENTS AND MARKETING EXECUTIVE Holly Dudden [email protected] NEWS DIGEST asks Lucy Jones PRODUCT MANAGER 06 Around the world: 22 Every cloud… Carlos Pallordet [email protected] IQ’s global market round-up Alternative reinsurance has DATA ANALYST Khilan Shah [email protected] 08 A touch of class: rebounded quickly from Q3 PRODUCTION EDITOR Market developments by class hurricane losses, findsFiona Peter Williams [email protected] 09 IQ PI: Robertson SUB-EDITOR Ewan Harwood [email protected] Market intelligence on the QT 26 Rapid relief ART DIRECTOR Post-Q3 rate hardening could ease Paul Sargent [email protected] FEATURES renewals for D&F writers, finds 3rd Floor, 41 Eastcheap, London, EC3M 1DT, UK 10 Where are the missing Marcus Alcock Tel main: +44 (0)20 7397 0615 billions? 30 Punching above their weight Editorial: +44 (0)20 7397 0618 investigates the meets with Barbican’s Subscriptions: +44 (0)20 7397 0619 Charlie Thomas Catrin Shi Annual subscription – £2245+VAT/$3505 disparity between projected and co-founders and senior reported Q3 cat losses management team Tel +44 (0)20 7397 0615 Fax +44 (0)20 7397 0616 [email protected] All rights reserved ©2017 IQ 14 History repeating is published under licence by Euromoney Trading Ltd Subscription enquiries Annie Lightholder Q3 cat losses have sharpened the INSIGHT Tel +44 (0)20 7397 0619 Fax +44 (0)20 7397 0616 focus on a broken NFIP, writes 34 Four years of good luck [email protected] Ted Bunker While reinsurers have benefited ISSN 1475-410X 404 www.insiderquarterly.com INSIDE CONTENTS WHERE ARE THE 10 MISSING BILLIONS? Charlie Thomas on Q3 cat claims versus modelled losses 14 HISTORY REPEATING Q3 cat losses have sharpened the focus on the NFIP, writes Ted Bunker 14 26 RAPID RELIEF D&F writers are set to benefit from post-Q3 rate hardening, finds Marcus Alcock PUNCHING ABOVE 30 THEIR WEIGHT Catrin Shi meets with the founders of Barbican 26 30 from good luck in recent years, Mark Grocott 56 Filling the gap they’ve also been destroying value, 46 Under the microscope Heneg Parthenay and Simon says Keith Wolfe Charles Pickles assesses asbestos Richards ponder the opportunities 36 Trouble in paradise risk management in the for insurers in the $1tn trade Mark Sutton and Karen Boto workplace finance short-term funding gap consider the insurance implications 58 Ready, steady… wait? of expanding regulations TECHNICAL BRIEFINGS Jonathan Charwat and Robbie 38 White heat 48 Happy birthday to you! Constance explore market concerns Now is the time to forge new Aidan O’Neill celebrates the about readiness for IDD business opportunities by exploring recent second birthday of the 60 Winning performance InsurTech, writes Toby Esser launch of Write-Back The London market relies on an 41 Reflecting on claims 50 Innovation at a snail’s pace overly subjective approach to Cumbersome processes and Greater engagement with measuring the quality of its US settlement delays are reflecting technology is needed to increase legal counsel, says Dwayne Hermes badly on Lloyd’s reputation for the rate of change, says Malcolm 62 Executive moves paying claims, says Sarah Newman Snow 44 Story time 53 Call to action The real story of InsurTech is about Paul Latarche says it's time to turn using it to respond to customers’ words into action on InsurTech needs more effectively, says www.insiderquarterly.com 055 NEWS DIGEST THE IRELAND The quake also killed 10 people in Together the four insurers took a 48.8 Sulaimaniyah, Iraq, and injured more percent share of the state’s homeowners’ Ophelia losses than 400 more in the neighbouring multi-peril insurance market in 2016, Despite relatively modest insured losses country. according to AM Best. and a mercifully low casualty toll, ex- Kermanshah Province’s vice governor, Allstate has put out an initial wildfire Hurricane Ophelia, which made landfall Mojtaba Nikkerdar, has put economic loss estimate of $452mn, while it is in Ireland on 16 October, was nonetheless losses from the disaster at 26tn rials understood that CSAA has a $950mn loss. a notable event. ($738mn). Elsewhere, AIG CFO Sid Sankaran Catastrophe data specialist Perils Early loss figures for the 12 November disclosed on the company’s third estimated insured losses at EUR60mn quake indicate that between 2 and 3 quarter earnings call that it would take ($71.6mn) after Ophelia caused significant percent of properties in the earthquake approximately $500mn of losses from the damage across Ireland, and lesser damage zone were insured, according to English- wildfires.