Latest aviation insurance news

23 July 2018

INDUSTRY NEWS

MUNICH RE, ENSTAR AND HANOVER CONSIDERING SALE OF THEIR LLOYD’S BUSINESSES

According to media reports, Munich Re, Enstar and Hanover are currently exploring their options in relation to the potential sale of their respective Lloyd’s businesses.

Enstar Group is reported to be considering the sale of Atrium and StarStone. Atrium, writes business through Lloyd’s syndicate 609, and StarStone is a speciality insurer with multiple global underwriting platforms.

German reinsurer Munich Re is also reported to be in talks to sell Beaufort Underwriting Agency, a Lloyd’s managing agency. Beaufort is responsible for the management of MSF Pritchard Syndicate 318, a specialty underwriter of both property and aviation business.

Additionally Hanover Insurance Group said in a recent statement that it is exploring strategic alternatives for specialist insurer Chaucer, who underwrites several classes of business at Lloyd’s.

These announcements follow recent news that Aspen Insurance is currently in talks with several suitors regarding a possible takeover.

EU REMOVES ALL INDONESIAN CARRIERS FROM AIR SAFETY LIST

The European Commission announced that it has removed all Indonesian carriers from the EU Air Safety List after the country made sufficient improvements to raise its aviation safety standards.

All Indonesian carriers were originally put on the EU Air Safety List in 2007 due to unaddressed safety concerns. Over the past years, seven operators had been removed, but the majority of Indonesian carriers remained on the list.

Following this recent update, the European Commission said a total of 119 airlines remain banned from EU skies. These include 114 airlines certified in 15 states where there is lack of safety oversight from aviation authorities and five individual airlines where there are safety concerns with the carrier’s themselves. An additional six airlines are subject to operational restrictions and can only fly to the EU with specific aircraft types.

IATA: SOLID PROFITS PREDICTED DESPITE RISING COSTS

The 74th IATA Annual General Meeting (AGM) and World Air Transport Summit took take place in Sydney between 3 and 5 June 2018.

Hosted by Qantas, this year’s summit brought around 1,000 industry leaders to Sydney to address a number of topics including sustainable aviation fuels, airport privatization, benefits and risks of tourism, gender equality, making the best use of data, next steps on aviation security, and preventing human trafficking.

During the event, IATA announced its expectation for airlines to achieve a collective net profit of USD 33.8 billion (4.1% net margin) in 2018. IATA said this represented a solid performance despite rising costs, primarily fuel and labor, but also the upturn in the interest rate cycle. Rising costs were highlighted as the main driver behind the downward revision from IATA’s previous forecast of USD38.4 billion in December 2017.

Passenger air travel is forecast to expand by 7.0%, boosted by stronger economic growth and the stimulus from new city-pair direct services. Capacity is expected to grow by 6.7% (the same pace as in 2017). Cargo demand is expected to grow by 4.0%, a major drop from the 9.7% growth experienced in 2017, but still in line with the 20-year trend growth rate.

IATA said over 1,900 aircraft are expected to be delivered to airlines in 2018 (up from 1,722 in 2017).

The full press release is available to view on the IATA website.

HDI GLOBAL AND HANNOVER RE TO MERGE SPECIALTY BUSINESSES

In a press release, Hannover Re and HDI Global announced the merging of their specialty activities under the joint venture HDI Global Specialty SE.

The new company HDI Global Specialty SE will write agency and specialty insurance business in lines such as Errors & Omissions liability insurance, directors’ and officers’ (D&O) liability insurance, legal expenses insurance, sports and entertainment, aviation, offshore energy and animal insurance.

The first step towards establishing the joint venture HDI Global Specialty will entail HDI Global SE acquiring the majority of the shares in International Insurance Company of Hannover SE (Inter Hannover), a subsidiary company of Hannover Re. After the transaction has taken place, Inter Hannover will be renamed HDI Global Specialty SE. HDI Global SE will contribute its specialty portfolio to the new company.

When the purchase of the shareholding is approved by the supervisory authorities, the joint venture will roll out joint operational activities on 1 January 2019.

WR BERKLEY WITHDRAWS FROM WRITING AVIATION BUSINESS

In a broker press release, WR Berkely announced that after careful consideration and review it has decided to exit the aviation line of business.

The carrier said, the exit is being conducted in compliance with all applicable state regulations and notice requirements and that it would honour all outstanding quotes and continue to service all of its aviation business during the run-off period.

BRIT WITHDRAWS FROM WRITING GENERAL AVIATION BUSINESS

In a broker press release, Brit Insurance announced that it will no longer write general aviation risks and has exited the line of business.

The insurer remains committed to airline, aerospace and space business and said its withdrawal would not impact existing policies or clients.

AVIABEL TO MERGE INTO AXIS SPECIALTY EUROPE SE

Aviabel announced that following its acquisition by AXIS, from 1 October 2018, Aviabel S.A. will be merged into AXIS Specialty Europe SE (ASE), which is the legal entity that oversees AXIS’ insurance business in Europe. As part of this legal entity merger, Aviabel will write on ASE paper under the Aviabel brand name, and backed by ASE.

MARKET MOVERS

Dan Crispe has joined STARR Aviation as Deputy Chief Underwriting Officer for Aviation and Head of Aerospace. He was previously Head of Aerospace at AIG.

Adam Spicer has left Brit Insurance and joined Elseco.

Will Gaunt has joined Hive Aero as Aviation War Class Underwriter. He was previously general aviation Class Underwriter at Talbot.

Gareth Howell has left his position at Brit and joined Global Aerospace as Client Executive and Manager, Policy Wordings.

Andy Bowman has left his position as Senior Claims Adjuster in the MS Amlin aviation team.

Patrick Cove has joined Sompo International as Global Head of Aviation Reinsurance based in Zurich.

Georgios Toulkeridis has left his position at Swiss Re and joined Everest Re as Global Head of Aerospace Reinsurance.

Allianz (AGCS) announced that Nicholas Pooley has been named Aviation Major Risks Product Lead for North America, based in New York.

Chris Gibbs has joined AmTrust at Lloyd’s as its new Head of Space.

McLarens Aviation announced that it has boosted its Asia Pacific team with the addition of three aviation adjusters across the region. James Pryor and Graham Raggett are based in Singapore and Jerry Qin has become the company’s first full time presence in Shanghai.

NEW AEROSPACE APPOINTMENTS AT JLT

JLT is further widening our specialty focus and global capabilities with new aerospace appointments based in London and the US.

Marcel Chad has joined JLT as a Partner within our London Aerospace practice. He brings a wealth of experience to JLT, particularly with US clients. Marcel joins JLT from Marsh, where he most recently held the senior role of Global Deputy Chairman of Aerospace.

Glenn Beadling has joined JLT’s US team as Executive Vice President, Aerospace, based in Dallas, Texas. With over 25 years of industry experience, Beadling comes to JLT from Willis Towers Watson, where he most recently served as Senior Vice President, Aerospace.

Tim Rush has joined JLT Specialty Inc. as Head of Business Development Space for the US. Tim joins JLT from RushPort Ventures, where he was managing director since December 2016. Prior to RushPort, he was a Senior Vice President in Marsh’s national space practice.

Chris Allen has joined JLT as an Account Manager within our London Aerospace practice. With over 30 years of industry experience, Chris joins JLT from TUI Group, where he was most recently Sector Insurance Manager.

James MacDonald has joined JLT as an Account Manager within our Aerospace practice. James joins JLT from Marsh where he was most recently an Aerospace Account Handler.

For more information, please contact Steven Godfrey, Aviation National Specialty Leader, Managing Director at ClientFirst@jltcanada.com.