R&q Insurance Share Discussion Threads

[simon gordon] 13/1/2022 18:05

Enstar, listed on Nasdaq, look to be a big player in Legacy:

Enstar is a leading global insurance group that delivers innovative insurance solutions through our network of group companies. Spanning a 27+ year history of operating in the run-off space, we leverage our ability to thoroughly understand risks and liabilities to create ideal legacy solutions for our partners. Our analytical approach benefits our partners seeking optimal capital deployment solutions crafted to meet their individual risk profiles.

We complement our core claims management business with a number of high-quality strategic investments.

ENSTAR CREATES VALUE

Founded in Bermuda in 1993, Enstar was created through acquisitions to become, by 2013, the industry’s largest stand-alone run-off consolidator. Later in 2013, we diversified into live risk by investing in leading specialty insurance companies in global markets, including Lloyd’s.

In 2020, as part of our strategy to focus on our core legacy competency, we announced transactions – alongside trusted partners - at our live underwriting operations, StarStone and Atrium, which retain our investments in these high-quality companies, through meaningful minority stakes.

Regulatory change around the world is driving risk businesses to refocus, which creates opportunities in the legacy space. In this environment, Enstar has the vision and appetite to grow further.

Enstar leverages its expertise in claims management, risk analysis, and investment to generate value. These services make Enstar different, something unique. Click here to learn more.

Enstar is publicly traded on the NASDAQ stock market (ticker symbol: ESGR).

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Market Cap today - $4.82bn

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They recently closed one legacy deal valued at $3.12bn in reserves - 10/1/22:




Here's their site:



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Hopefully, Andrew Pinkes, the new Global Legacy CEO at RQIH will bring in some chunky reserves for Gibson RE mark 1 and mark 2 can follow in a canter.

'Andrew is a 30 year veteran of the insurance industry, focused on P&C, Specialty, Disability and Property Casualty run-off management. Currently, Andrew serves as a consultant and senior advisor to a number of private equity and venture capital portfolio companies and is an independent board director.

Andrew was the Executive Vice President, Worldwide P&C Claims at CNA. He was a member of the senior leadership team and had responsibility for over 1,700 claims, legal, operations, finance, actuarial, and business intelligence professionals.

Before CNA, Andrew was the Executive Vice President, Global Head of Claims at XL Group, and also Executive Vice President, Claims, P&C run-off operations and acting head of Commercial Markets business at The Hartford Financial Services Group, Inc. Prior to that, Andrew was the Senior Vice President and General Counsel, Special Liability Group at the Travelers.

Throughout his career, Andrew has led a series of large-scale transformations focused on delivering bottom line impact through improved service, efficiency, and outcomes leveraging analytics, operating model design, and large scale change management. He has deep expertise in legal/litigation management, medical management, large loss claim handling, quality program design, TPA oversight, and vendor management. Andrew also has led several operating model redesign efforts, modernizing the organizational design, processes, and systems to drive improved results and ongoing continuous improvement.

Andrew is on the Board of Overseers for the Rand Institute for Civil Justice.'

[simon gordon] 13/1/2022 14:58

Hi Martin,

10% of the $100bn premium with MGAs is taken by Progam managers with $90bn currently going to the big insurers like AON.

I note one small MGA went bust the other day when Berkshire cut their line.

William Spiegel highlighted lack of control as one reason why more business will move from MGAs to Program managers like Accredited.

Maybe the MGAs get a better deal and more security with a Program relationship rather than working with the likes of AON?

[martindjzz] 13/1/2022 14:32

To quote Falvey, "With R&Q Accredited America, it allows Falvey to enter into a strategic partnership to enable us to share in the profitable portfolio that we underwrite on behalf of our partners.”

That sounds to me like Falvey is going to move some business from existing carrier relationships to Accredited in return for a bigger share of the underwriting profit. I think more MGAs will be interested in that and we trust in the RQH management team to find the right balance of risk and reward.

[geraldus] 13/1/2022 14:03

Great info on this thread.One of the best boards.Thanks to all.

[simon gordon] 13/1/2022 10:29

New agreement for Accredited America:

Falvey Cargo Underwriting - 11/1/22:

Falvey Cargo Underwriting Increases Capacity to Handle Growing Supply Chain Exposures with the addition of Great American Insurance Group and R&Q Accredited America to Security Panel

Falvey Cargo Underwriting is one of the largest providers of cargo insurance in the United States and as the supply chain continues to grow more complex, the need for capacity and innovative solutions is at an all-time high. Falvey Cargo Underwriting continues to stay ahead of these trends to ensure it has the capacity and internal resources to provide solutions with a World-Class level of service.

Mike McKenna, Chief Underwriting Officer at Falvey Insurance Group – the parent company of Falvey Cargo Underwriting – explains, "At Falvey, we continue to build our relationships with high-quality underwriting firms to mutually benefit and assist to meeting our strategic goals in the US marine marketplace. In the case of Great American (GA), the relationship allows GA to partner with Falvey, a first-in-class underwriting organization, to further its goals of profitable growth in the marine cargo sector. With Great American, the relationship is centered around building additional US admitted capacity as the needs of our customers grow. With R&Q Accredited America, it allows Falvey to enter into a strategic partnership to enable us to share in the profitable portfolio that we underwrite on behalf of our partners."

Jack Falvey, Chief Operating Officer at Falvey Insurance Group adds, "The Group is very excited to welcome these two new partners on board as we continue to meet the demands of our clients while also working with our new and existing partners on other upcoming opportunities. The teams at both Great American and R&Q Accredited America have been exceptional to work with and we know this is just the beginning of two lasting relationships."

"Falvey understands the underlying issues impacting global commerce and are continually pursuing solutions to alleviate the pressure created by the worldwide imbalance in supply and demand," said Paul Amrose, Accredited's Chief Underwriting Officer of Property. "Accredited is excited to partner with Falvey in providing a solution to the supply chain obstacles impacting economies in the US and abroad."



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Lloyds of London moving to the Cloud:

Tech Market View - 13/1/22

DXC Technology chosen to transform Lloyd's of London

DXC Technology has won a major deal with Lloyd’s of London and the International Underwriters Association (IUA) to transform the World’s longest established insurance marketplace. The project represents a wholesale transformation of the 300-year-old organisation and will take it from a legacy system of mainframes and paper processes to a cloud native digital platform.

The contract follows the joint venture and Heads of Terms that was agreed between the parties in May last year last year (see: London insurance market puts its future in DXC’s hands). DXC has now been selected to design and implement the technology infrastructure that will transform the London insurance market. The US vendor will rearchitect the market’s entire IT system and develop a cloud-native digital platform running on AWS whilst fully automating most manual processes.

The London insurance market currently employs close to 50k people across the UK and accounts for around 8% of all global commercial (re)insurance. Importantly for the British economy, the market provides almost a quarter of the City of London’s GDP, with annual gross written premiums worth more than £80bn.

As technology modernisation within the insurance sector has gained pace, Lloyd’s and the London Market have been losing ground to more technically advanced global insurance markets. As a result, the technology agreement with DXC represents a major milestone for this historic centre and supports the ambitions for the future outlined by Lloyd’s CEO John Neal, in his latest “Blueprint” plan published in November 2020 .

[simon gordon] 11/1/2022 17:28

Hi Martin,

Yes, the GWP will take time to work through but sure adds some hefty GWP into future years and it's only one MGA.

Good fortune!!

[simon gordon] 11/1/2022 17:09

Insurance Journal - 11/1/21:

MGA First Underwriting Forms £1B, 5-Year Capacity Deal With Accredited Insurance

First Underwriting Ltd., the London-based specialist MGA that is part of Kingfisher UK Holdings, announced a five-year capacity deal to place approximately £1 billion (US$1.4 billion) of gross written premium into the market.

Working in partnership with Accredited Insurance (Europe) Ltd., and with broker McGill and Partners, the deal will provide capacity for its range of specialty products.

This extended partnership with Accredited will continue to deliver on First Underwriting’s strategy to be a total solution for its broking partners and will support new product launches planned for 2022, said the MGA in a statement.

Accredited’s underwriting program is supported by A-rated reinsurance, which is arranged by McGill and Partners, a boutique specialist re/insurance broker. Accredited is a subsidiary of Randall & Quilter Investment Holdings Ltd.

Launched in 2018, First Underwriting initially focused on specialist motor and then expanded across property, casualty and bonds. The company said it quickly established itself as a broker centric and service-led underwriter, delivering 30%-plus growth each year.

The next phase of growth will be to further diversify the book by focusing on niche non-motor lines while retaining its market-leading position in speciality motor, First Underwriting said.

“We are delighted to announce this new long-term deal, which will help support the next chapter of our journey. Accredited have supported us from our launch, and, as a result, we have formed a strong and ambitious partnership,” commented Tom Donachie, managing director of First Underwriting.

“It was important we secured a long-term deal with A-rated paper to provide our brokers and their customers with the confidence of a secure market. We plan to continue focusing on specialist lines, providing a superior service to our brokers and leaning on the experience of our team of experts,” he added.

“This is a unique and innovative capacity solution which will give First Underwriting the flexibility and scope to build and diversify into a truly multi-line underwriting business. Accredited have been a key partner since First Underwriting’s inception and it is fantastic to now have the certainty of a five-year capacity commitment from an A-rated partner,” said Jacquie Boast, CEO at Kingfisher UK Holdings.

“This new long-term contract highlights the success of the First Underwriting team and their profitable and sustainable growth over the past three years that have delivered quality business and exceptional service to their brokers and partners,” Boast added.

“We are pleased to further extend our relationship with First Underwriting through this long-term arrangement borne out of our focus to develop strategic partnerships with leading MGAs, highly rated reinsurers and the ILS markets in UK, Europe and US,” according to Alan Quilter, group CEO of Randall & Quilter.

First Underwriting is wholly owned by Kingfisher UK Holdings Ltd., which is a UK division of NSM Insurance Group. Kingfisher owns, grows and acquires specialist insurance businesses. Accredited are rated as A- with a ‘stable’ outlook by A M Best and are wholly owned by Randall & Quilter Investment Holdings, who had cash and investments in excess of $1,716 million at 30 June 2021.

Accredited Insurance (Europe) Limited, is licensed to write all non-life classes in all EU member states and is also A- (Excellent) A.M. Best rated. Its Malta insurance company and UK branch office enables the firm to provide a ready-made Brexit solution to European MGAs.

[martindjzz] 11/1/2022 16:04

Whilst the Kingfisher deal is obviously good news it may take some time for it to impact RQH in a meaningful way. First Underwriting say the capacity is for new product launches in 2022, and then the products have to be marketed to brokers. The premium throughput will be low at first, climbing as First takes renewal business from other insurers. We may have to wait and see if and/or how the deal affects the GWP targets management previously shared with investors. You can get more info by looking at how Kingfisher Insurance themselves announced it on their own website.

[simon gordon] 11/1/2022 13:48

Looks a biggie!!

Insurance Age - 11/1/22:

First Underwriting secures £1bn capacity from Accredited

First Underwriting, the specialist MGA that is part of Kingfisher UK Holdings, has announced a five-year capacity deal to place £1bn of gross written premium into the market, Insurance Age can reveal. Working in partnership with Accredited Insurance and with McGill & Partners, the deal will provide capacity for First’s range of specialty products. This extended partnership with Accredited, which is owned by Randall & Quilter, has been agreed to help First remain broker-focused and allow it to...

Balance of article is behind a paywall...



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Frank Sinatra - Fly Me to the Moon:

[stav13] 11/1/2022 13:21

First Underwriting, the specialist MGA that is part of Kingfisher UK Holdings, has announced a five-year capacity deal to place £1bn of gross written premium into the market, Insurance Age can reveal.
This extended partnership with Accredited, which is owned by Randall & Quilter, has been agreed to help First remain broker-focused.

[masurenguy] 10/1/2022 08:09

Hi Simon, Thanks for the link. I note that I had also missed out JO Hambro Capital Mgmt too.
This is the updated major shareholder position extracted from your link.

Brickell PC Insurance Holdings LLC: 58,423,064: 21.23%
Phoenix Asset Management Partners Limited: 28,379,076: 10.31%
Slater Investments: 22,176,334: 8.06%
J O Hambro Capital Management Ltd: 18,703,662: 6.80%
Aberdeen Standard Investments: 18,199,562: 6.61%
Premier Miton Group plc 17,102,184: 6.21%
Hudson Structured Capital Management: 11,779,119: 4.28%

Happy, and prosperous, new year to you too.

[masurenguy] 09/1/2022 15:43

Cheers jon - name duplication can get quite confusing at times especially in this case since the Phoenix Group is focused upon the management of legacy insurance brands and policies.

[jonwig] 09/1/2022 14:56

Mas "Phoenix Asset management" is not connected with Phoenix Group, and is unquoted.

It's amazing how many companies use the word "Phoenix" in their name!

[masurenguy] 09/1/2022 13:58

An interesting institutional shareholding register. Phoenix is one of my top 6 holdings and they have cut their stake here by circa 40%, from 18.3% to 10.8%, during 2021 although they currently still remain the largest shareholder. Conversely, Mark Slater has been building a position here over the past few months. I have no current position but have added RQIH to my watchlist.

Current Major Institutional shareholders

Phoenix Asset Management: 29.70m: 10.79%
Slater Investments: 22.18m: 8.06%
J.O. Hambro Capital Management: 19.31m: 7.02%
Abrdn Investment Management: 17.51m: 6.36%
Miton Asset Management: 16.87m: 6.13%
Chelverton Asset Management: 9.35m: 3.40%
Amati Global Investors: 5.93m: 2.15%
Gresham House Asset Management: 5.22m: 1.90%
Franklin Templeton Fund Management: 5.05m: 1.84%
AXA Investment Managers UK: 2.98m: 1.08%

Top 10 Institutional Holders: 48.73%

[simon gordon] 24/12/2021 17:23

Legacy run-off specialist Riverstone bought by CVC for $700m earlier this year:

Insurance Journal - 24/8/21

CVC Capital Completes $700M Purchase of RiverStone Europe from Fairfax



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About RiverStone International

RiverStone International is an industry-leading acquirer and reinsurer of legacy and discontinued insurance business. Operating in the UK company and Lloyd’s of London markets, RiverStone International has transacted a wide variety of deals – from insurance and reinsurance portfolio transfers to company purchases, acquiring over US$7 billion of liabilities since 2010 and with around US$4 billion of liabilities currently under management. RiverStone International’s highly skilled and tenured professionals employ ownership, accountability, commitment, and an open and flexible approach to all transactions to provide transactional certainty, deliver desired outcomes and maintain clients’ reputations.



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[simon gordon] 19/12/2021 15:02

RQIH briefly mentioned at 6.38:

Interactive Investor - 15/12/21

Gervais Williams: my four dividend stocks for 2022

[simon gordon] 17/12/2021 18:19

RQIH's management are in a different league. They make very clear the risks and are transparent. Imagine if Google one day killed TONIC's ad feed!! I've no idea if it could happen but it's happened to a competitor. One company in the scene closed their domain name parking division because morally they couldn't face themselves anymore knowing some people were being scammed. Who knows, they might get lucky and it rolls without any controversy. If it did blow up the share would collapse violently. I don't think they are set up to handle a black swan and they've increased their risk with their new dynamic strategy.

RQIH's new strategy in Legacy actually de-risks the equity, improves the quality of the earnings and greatly enhances expansion of future earnings. The management here are very high caliber. I think William Spiegel's strategy is superb and should deliver good returns. Hopefully, it won't become a PI darling as that just draws in hot temperamental money. It will be the big institutional money that will power the share higher if they execute on the 2023 goals and or exceed them.

[martindjzz] 17/12/2021 17:53

Hi Simon and thanks for the helpful article on CNIC. It is obviously very important to have faith in what the management is saying and that is one of my reasons for joining the R&Q party.

[simon gordon] 17/12/2021 17:10

Hi Martin

I see that you bought into CNIC recently. I was in it but sold when I became more conscious that the Marketing earnings are not of a particularly high quality, hence forward guidance is not hard boiled, they can't forecast clearly because TONIC could see a fall off in Google pricing in the click of a button, it's the dodgy end of internet advertising. The Cookies change is good for CNIC but I don't like the line that the earnings are recurring, which they are in Services but in Marketing they are not, they have no control on the pricing, Google is their biggest customer.

If the story starts going sour it will probably be because of the factors mentioned in this article:



I tried to speak to the writer at Domain Name Wire but he wouldn't speak to me. I didn't speak to the company as I'm not enamoured by the way they explain their story. TONIC pricing has been strong, hence the share moving from 90s to 140s. Quite a few brokers are behind the story with 200p+ target prices. It may continue to run but watch out if it starts stalling. Bottom line is I couldn't work out the risk on their Marketing (Team Internet) earnings and pulled the plug on my investment.

Good fortune.

[alun rm] 17/12/2021 16:41

Thanks for posting Martin. I hope you can offer some industry expertise on the thread as we go forward.

[martindjzz] 17/12/2021 13:08

I’m a retired veteran of the industry with a good understanding of Program Management as RQIH describes it. Until today I chose not to have any of my investment portfolio in the general insurance sector but having now spent hours going through several articles mentioned on this BB (thank you all) and the material on their own website I think the case for investing in RQIH is quite compelling. Anyway having bought in a couple of tranches I now have 4pct of my self managed portfolio in it. My guess is that for some time yet, most PIs will still be put off by the complexity of the business and/or the price spread.

[simon gordon] 16/12/2021 19:08

RQIH flagged as a share idea on this webinar, it's the final one at 1.01:

Vox Markets - 15/12/21

Special Xmas ‘stock picking’ forum

[simon gordon] 16/12/2021 09:48

Pure Programs - 8/12/21:

PURE Programs Continues to Add Capacity Through Partnership with R&Q Accredited America




PURE Programs, LLC., is a managing general underwriter offering specialized Excess & Surplus (E&S) insurance and risk management solutions for PURE members and other responsible high net worth families whose complex exposures do not qualify for coverage from an admitted insurer. PURE Programs shares much of the infrastructure behind its admitted affiliate, PURE Insurance, including world-class risk management and claims services as well as electronic billing and policy delivery, in order to provide an exceptional experience for policyholders and their brokers.

The PURE Group is one of the leading writers of high net worth insurance in the United States. The company has grown organically by more than 20% in each of the past twelve years and has inforce premiums of more than $1 billion. The PURE Group creates specialized insurance solutions and offers coverages including: Homeowners; Automobile; Personal Excess Liability; Jewelry, Art & Collections; Fraud and Cyber Fraud; Watercraft; and Flood. The company is headquartered in White Plains, New York with ten offices across the United States. The PURE Group employs approximately 800 people writing business in 49 states and the District of Columbia.

[simon gordon] 15/12/2021 17:33

RQIH shareholder Hudson Structured's CEO Michael Millette in this video talks about the structural reasons why legacy run-off is a growth industry and there are twelve operators in the field, R&Q is mentioned but not discussed, 8.10 minutes in on the video:

Artemis BS - 26/5/20

Michael Millette, Founder & Managing Partner at Hudson Structured Capital Management, a specialist alternative asset manager with a focus on sourcing insurance and reinsurance linked returns for its investors, joined us for our latest video interview.