MS Amlin: The talent challenge

The carousel of senior personnel at MS Amlin has continued to spin over the past two years, with a number of high-profile departures – and subsequent arrivals – at the MS&AD-owned carrier.

MS Amlin

But in recent weeks, the merry-go-round has gone into full swing.

Chris Beazley was the latest to head to the door. The executive, who has served as CEO of the carrier’s Zurich-headquartered reinsurance operations for the past three years, was said to be departing to “pursue opportunities outside of MS Amlin”.

He left the carrier following a 14-year tenure, having held several leadership roles across the MS Amlin group of companies over the last decade before taking the helm of MS Amlin AG in 2018.

His exit from the firm came the same day as the departure of Reijer Groenveld, CFO of MS Amlin Insurance SE – the company’s European primary insurance arm.

The moves followed a series of other C-suite departures. Catherine Farnworth, chief risk officer (CRO) of MS Amlin AG, exited the firm in July, a move first revealed by this publication.

News of Farnworth’s exit closely followed the announcement that Vishal Desai, CRO of the group’s Lloyd’s business MS Amlin Underwriting Ltd, had also tendered his notice.

These departures come as parent MS&AD – which paid a gravity-defying 2.4x net tangible assets (or £3.5bn) for Amlin in 2016 – continues efforts to transform the fortunes of the business. 

Since coming under the ownership of the Japanese big three insurer, the unit has failed to return an annual underwriting profit.

MS Amlin Syndicate 2001 seven year financial summary

At Lloyd’s, the slide into the red began in 2016 with Syndicate 2001 producing a combined ratio of 107 percent and a loss of £35.1mn.

But the syndicate’s annus horribilis came in 2017, when it posted a loss of £499.7mn – which at the time was the second worst syndicate result in Lloyd’s history – alongside a combined ratio of 141 percent.

The following year was marred by another cat-heavy H2, with the carrier posting a further loss of £114mn.

While 2019 marked a return to the black with a profit of £69.2mn, Syndicate 2001 made another underwriting loss with a combined ratio of 103 percent.

The turnaround of MS Amlin began in the wake of the heavy cat losses of 2017-18, with the message from MS&AD being simplification as it introduced greater oversight from Tokyo.

Once Lloyd’s largest syndicate, MS Amlin’s Syndicate 2001 has shrunk in size following its outsized 2017-18 losses. In 2020, Syndicate 2001 reduced its stamp capacity to £1.6bn, down 13.5 percent from the £1.85bn it had in 2019 (and 2018). It remained flat at £1.6bn in 2021.

MS Amlin’s stamp remained flat in 2021

The carrier has also exited nine classes and operations on its Lloyd’s platform, with the most prominent being its $50mn-$100mn aviation book.

The other classes were UK corporate property, UK real estate, UK casualty, UK package binders, UK fleet, UK yacht, bloodstock and insolvency risk (AUA).

It also ceased writing property quota shares through the syndicate.

In addition MS Amlin made changes to its operating structure, splitting into three units: MS Amlin AG, MS Amlin Underwriting Ltd and MS Amlin Insurance SE (see image).

MS Amlin legal structure

In addition to the high-profile exits tracked this year, MS&AD’s transformation plan had already seen sweeping changes to MS Amlin’s management.

These included the departure of Simon Beale as CEO of MS Amlin plc shortly after the holding company was dissolved. 

As this publication reported in September 2019, James Few, who had been MS Amlin’s reinsurance head, left the business to join broker TigerRisk as CEO of its London office.

Tom Clementi, CEO of the Lloyd’s business, departed in October last year to be replaced by Johan Slabbert.

The Insurer also revealed the departure of the carrier’s reinsurance CUO Dominic Peters, who has since been named active underwriter of Dale Underwriting.

Peters closely followed MS Amlin’s head of international and global product lead Bob Mellor in heading to the door, with the latter leaving the carrier after more than a decade for McGill and Partners, where he became a partner in its reinsurance business.

Recent high-profile departures from MS Amlin...

Of course, not all of the moves have been in one direction.

Last December, MS Amlin brought in former PartnerRe P&C CEO Charles Goldie as MS Amlin AG’s chief underwriting officer.

Also heading in the other direction, MS Amlin named Norbert Herkströter COO of European primary arm MS Amlin Insurance SE.

Other arrivals have included Lloyd’s head of capital Catherine Scullion as chief actuary and former Ariel Re executive Matthew Wilken as head of reinsurance. 

And last week, when announcing the departure of Groenveld, the carrier named Axa’s Frédéric Fischer as his replacement as CFO of MS Amlin Insurance SE.

While the firm did not name Beazley’s successor, MS Amlin said it had identified the next chief executive of its reinsurance operations.

MS Amlin AG said that it had “concluded negotiations with a well-respected reinsurance leader with over 30 years of industry experience” to succeed Beazley, but did not name his successor.

The replacement candidate has successfully led global strategic initiatives across the Americas, Asia and Europe, MS Amlin said, with the business “eagerly” anticipating announcing the new CEO “in the near future”.

Recent notable arrivals at MS Amlin...

Winds of change

But against the backdrop of the revolving door of talent, MS&AD’s significant actions to turn around the underwriting performance of its subsidiary look to be taking shape.

Last month, MS Amlin reported it had eked out a £20mn ($27.8mn) profit for the first quarter, a swing of £156mn compared with the opening three months of 2020.

It also shaved 1.5 percentage points off its combined ratio compared with the prior-year period, coming in at 106.4 percent for the first quarter (MS Amlin reports on a one-quarter time lag).

While on the surface the numbers aren’t overly impressive, they represent a marked change in direction for the carrier. 

For MS&AD the most recent set of results for the business are likely to be welcomed, but show there is still work to be done by MS Amlin’s new arrivals if it is to justify the hefty purchase price paid in 2016…