Guy Carpenter and Howden Tiger settle Hong Kong reinsurance raid dispute

The legal dispute over Guy Carpenter’s raid on Howden Tiger’s six-strong Hong Kong operation was settled as part of the $70mn out-of-court agreement between Howden Group and the Marsh McLennan subsidiary earlier this month over the defection of several Europe-based employees, The Insurer can reveal.

This publication first reported on 10 October that Guy Carpenter and Howden Group had settled a London legal dispute over the unlawful poaching of 38 Europe-based former Marsh McLennan employees to the UK broking group.

The settlement was struck only hours before a multi-week trial was due to begin in London’s High Court.

While terms were not disclosed, Marsh McLennan has since reported that it settled a claim with an unnamed competitor for $70mn related to the “unlawful recruiting”, an accusation Howden Group apologised for in a statement following the announced settlement.

But today this publication can reveal that this was in effect an umbrella deal, also resolving the Hong Kong litigation between the two firms relating to a seemingly tit-for-tat raid by Guy Carpenter on Howden Tiger’s Asia team only weeks after the European moves.

In May, Asian reinsurance veteran Steve Warwick resigned to join Guy Carpenter and was swiftly followed by up to five members of his Hong Kong-based team.

The Insurer reported earlier this year that the raid sparked litigation between the two firms for at least the fifth time in five years, with Howden Group issuing a complaint in the Hong Kong High Court against Guy Carpenter and its Asia Pacific CEO Tony Gallagher.

Also named in the suit were former Howden Tiger head of treaty Asia Pacific Warwick, Howden Tiger treaty head for greater China Tao Han, and director of treaty reinsurance Xueyang Wang.

All three defected to Guy Carpenter in quick succession in early May, together with a further three colleagues: Howden Tiger treaty brokers Mela Chan and Iris Leung, and senior broker technician Stephany Yau.

Howden accused the named defendants of breaching their contractual, equitable and fiduciary duties by conspiring to cause “loss by unlawful means” through “a coordinated and carefully planned team move”.

The end to hostilities over Guy Carpenter’s Hong Kong raid – as part of the wider London settlement – is only the latest talent poaching dispute resolution between the firms.

Guy Carpenter and Howden were also recently engaged in legal sabre-rattling over Howden’s hiring of a 30-person London-based treaty team headed up by Bradley Maltese in 2021, and a 10+ Dallas-based programs team led by former GC Access heads Michael Jameson and Matt Beard last year.

Both these disputes were also ultimately settled out of court with confidential settlements, as was an earlier dispute between Howden Group and Marsh McLennan over more than 100 hires made in the wake of the latter’s £4.3bn takeover of UK broker JLT in 2019.

Guy Carpenter traditionally rivals Aon as the industry’s largest reinsurance intermediary with revenues now in excess of $2bn. Together with Gallagher Re – the number three firm by revenue size – the trio have consolidated a market share of brokered reinsurance treaty potentially as high as 80 percent. Challengers with global aspirations – such as Benfield in 2008 and arguably JLT Re a decade later – have been ruthlessly swept up.

But Howden Tiger – formed from the $1.6bn merger of TigerRisk with Howden Group’s existing reinsurance unit – is emerging as a fresh challenger to the global oligopoly.