MS Amlin “out of the pickle jar” as it looks to 1.1 with confidence: Carrier

MS Amlin Underwriting CEO Andrew Carrier has claimed the Lloyd’s (re)insurer is finally “out of the pickle jar” and poised to enter the 2024 renewal period with a renewed risk and growth appetite, following a period of extensive remedial work and shrinkage following heavy losses between 2017-21.

Speaking to The Insurer at the Rendez-Vous, Carrier said the Lloyd’s (re)insurer – which underwrites principally through Syndicate 2001 – was in “a state of remediation for a long time”.

He added: “Every company has its day in the pickle jar and perhaps for MS Amlin ours was somewhat protracted and the remediation probably took longer than you would ordinarily expect.

“But we’re now starting to come out of that period, we're seeing lots of green shoots come through and it's starting to flow through into our financial statements and that is what really matters,” he explained, noting that Syndicate 2001 delivered a 98 percent combined ratio last year.

“2024 marks a real opportunity for us, because irrespective of where the market conditions are, finally, our house is in order and we can start underwriting in the manner in which we’d like to.”

Carrier said work to enhance MS Amlin’s risk selection capability is “about 90 percent complete”, while work to its portfolio mix is now “more than 70 percent” completed.

The veteran underwriter was named CEO of MS Amlin in October 2022 when he replaced Johan Slabbert, who relocated within the MS&AD business to lead its onshore US (re)insurance arm, MSIG Holdings (USA).

Slabbert was a key figure in overhauling MS Amlin’s underwriting and structures following the heavy losses which saw the Tokyo head office – and Lloyd’s – demand major changes. These legacy failings also resulted in a £9.7mn fine from the Prudential Regulation Authority, which was understandably received badly by Japan’s largest insurance group – which bought the Lloyd’s (re)insurer in good faith in 2016 for £3.5bn.

Carrier added that the firm was particularly attracted to the “buoyancy” in the property cat market and would look to increase its share at renewal, predicting firmer pricing conditions would remain for some time.

“Historically property cat has been a shop-window product for us and we still have a long-term intent in that market – it's a certain component of what we do as a whole organisation.

“It will never be a very significant line for us, but it's a line in which we have long-term intent and room to be a part of. The buoyancy in that market is something which we are attracted to and feel like we can participate in.”

But the “unprecedented” US severe convective storm activity this year means “material movements” are still required in frequency/cat aggregate products despite the recent rate improvements, Carrier added.

“We've definitely seen both frequency and severity increase exponentially in terms of nat cat perils and particularly on the frequency side, one could make the argument that the low-down aggregate product still needs some work.

“Attachment points addressing the frequency risk of natural perils still have some way to go. I think it is clear that nat cat peril severity has been accommodated more in recent years than the frequency product and that needs to change.”