Talking to The ReInsurer, McGill said the growing broker is bullish in its intention to build out in areas they see the most opportunity.
“The opportunities in reinsurance broking are significant,” he said in a video interview.
“Market conditions have changed quite profoundly as carriers, insurance companies and Lloyd’s syndicates look for innovative solutions both on the treaty and facultative side of the business. Due to M&A activity in the industry, the concentration of business amongst what is currently the three biggest broking firms - Aon, Guy Carpenter and Willis Re - is very substantial and that’s now going to consolidate down to two.
“So choices are constrained, market conditions are challenging and therefore building out our reinsurance capabilities with exceptional talent is an absolute no brainer as far as we’re concerned.
“Our pipeline in this area for recruitment remains [strong],” he added.
Just prior to Covid-19 shutting down the City in March, McGill and Partners was made up of 160 people, but according to McGill, the group’s hiring spree has continued during lockdown and as of today, the business boasts a group of 235 colleagues and McGill continues to eye up further recruitment opportunities.
Referring to the Aon-Willis Towers Watson deal as the “biggest structural change in broker history”, McGill said he anticipates further “knockon effects” to play out in 2021, predicting a lot of “interesting and positive times” for McGill and Partners.
“We’re very excited about what the future holds,” he said, later referring to the prospects in 2021 as “phenomenal”.
Speaking specifically about the opportunities in the reinsurance broking space, he views this in “two dimensions”.
“One is to provide world class solutions to Lloyd’s syndicates, insurance and reinsurance companies through the optimum reinsurance structures. But one of the unique things about McGill and Partners is we’ve developed a certified differentiated value proposition for corporate clients and a key part of that is navigating the entire value chain from insurance capital all the way through to reinsurance and retro capital,” he said.
On the upcoming renewal season and associated trends, McGill flagged a few themes contributing to the hardening market.
“Covid losses have got quite a way to play out for the market, and you’ve also seen other loss activity, including the explosion in Beirut and this year’s hurricane season is certainly looking to be above average.”
He added: “The market across specialty (re)insurance is hardening at quite a pace and that context means that you’ve really got to start renewal negotiations a lot earlier and planning and process will be really important.”
The danger, according to McGill, is if brokers aren’t on top of their communications with carriers and clients, this could result in a “huge disconnect” between what clients are expecting and what the market is going to provide.
“It’s a rapidly evolving picture and more challenging environment, but I think it’s a matter of preparing clients properly for what 1.1 renewals are looking like, working closely with carriers and being highly creative and thoughtful about how to structure the most efficient programmes in the market,” he added.