AXIS Re had recently acquired Novae Group plc, a diversified specialty (re)insurer that operates through Lloyd’s of London. Asia Insurance Review speaks with Mr Richard Milner, President and Chief Underwriting Officer, AXIS Re, APAC and London, about this, its Asia strategy and emerging risks.
By Anoop Khanna
AXIS Re has made significant progress in Asia Pacific in the last five-plus years since they focused their APAC underwriting efforts out of the Singapore office, said Mr Richard Milner. “We have been growing our business in Asia strategically and are satisfied with our positioning in the Asia Pacific reinsurance market. We have also recently added casualty, marine and engineering expertise in our Singapore office.”
Adding that AXIS Re’s biggest strength is their client focus, he said: “We spend a lot of time with clients and brokers; we don’t simply take shares. We support individual clients, across multiple product lines.”
An established global reinsurer with a worldwide network, AXIS Re also takes pride in its ability to analyse risk and to produce results that deliver value to its clients and brokers, said Mr Milner.
Acquisition of Novae Group
On its recent acquisition of Novae Group plc, Mr Milner said this and their appointment of Mr Steve Arora as the new CEO, shows “a larger strategy at AXIS to succeed in today’s transformative marketplace.”
He added: “The acquisition of Novae increases our global presence by giving us a platform in London through the formation of AXIS Re London. In doing so, we now have access to Lloyd’s Syndicate paper, which enables us to expand our distribution networks.”
Several of Novae’s cedants are based in the APAC region and are also clients of AXIS Re. The reinsurer would leverage the acquisition as an opportunity to further strengthen its relationships with a number of these clients. Mr Milner said: “We are now looking forward to continuing the momentum and progress we have made throughout this year.”
Expectations from January 2018 renewals
Speaking about the January renewals Mr Milner said: “We are optimistic that rates will begin to increase. We are seeing positive signs that pricing in certain lines is starting to return to a state at which we feel those lines can be profitable in the long term.”
“Things may, however, shift between now and 1 January,” he said, “but all stakeholders in the insurance industry understand that adverse pricing levels in certain lines have reached a point that is no longer sustainable,” he added.
Recent CAT losses in US
Speaking about the recent natural catastrophic events in the US and other parts of the world, Mr Milner said: “These CAT events have highlighted the general inadequacy of rates across multiple lines.”
He said these events have had a significant impact on profitability across the reinsurance industry, “but our industry has navigated challenging events in the past and we will continue to do so as this is the nature of our business”.
Mr Milner is optimistic that there is now a broad recognition of the reality that rates need to adjust upwards and there are presently promising signs in the marketplace.
Emergence, concentration and insurability of risks
Mr Milner said AXIS Re has always taken a pragmatic approach to providing cover for emerging areas of risk, particularly risks with a lack of historical data.
“We closely track emerging risks, and by working with our colleagues across AXIS Re and within the industry, we are better able to analyse the full scope of a new risk and weigh the pros and cons of providing cover,” he said. A