Rivalries and reinsurance renewed
Disappointing reinsurance renewals, tragedy and blame in Miami, and the tortuous Aon WTW merger all grabbed Matt Beasley’s interest in this week’s review of the latest insurance news.
The start of July brings Wimbledon, increasing English football fervour and of course reinsurance renewals. Jules Rimet may still be gleaming on the pitch for England, but the mood in the market was more Wales or Scotland. ‘Another disappointing round of reinsurance renewals’ with rate increases at the lower end of expectations, mainly single digit increases across the board except in the face of US cat losses (winter storm Uri) and Covid-19 related issues.
The Insurance Insider concluded pessimistically that the muted renewals will come as a sign that despite the pandemic bringing the first broad-based reinsurance rate upturn in 15 years, those conditions may not last into 2022.
Late last week, tragically a residential apartment building in Miami collapsed in the night, claiming the vast majority of those sleeping in their beds. As is often the case in such sad events, after shock and rescue, attention turns to blame, then insurance. Initial reports have suggested that the block has $48m in total P&C insurance coverage, according to information presented to a Florida state court. But a lengthy legal process will no doubt follow to allocate compensation to residents and apartment owners.
Overseeing a preliminary hearing of a class action lawsuit filed by the victims against the owner, the Judge said the insurance limits would “obviously be inadequate to compensate everyone fully to the extent of their harm”.
The Aon WTW merger has again been in the press this week, and the seemingly endless political and legal hurdles both parties will have to overcome just keep on coming. Insurance Day described the legal battle as ‘more of a war’, and noted that the changing of the guard in the White House may add further obstacles, as Trump’s laissez faire attitude to, well, most important things really, is in contrast to the Biden administration’s more thorough approach to judicial oversight. Other headlines on the merger noted Singaporean and New Zealand regulators, amongst others, poring over the deal.
Elsewhere in the world of brokers getting on famously, Marsh and Aon are in a legal battle over the move of around 40 staff from Aon to Marsh. Claims of bullying its employees and unfairly squashing competition abound. Aon claimed the move violated Florida law and will cost tens of millions in damages.