Miller mulls expansion across niche specialty in Asia

Miller has set its sights on robust expansion, with a keen emphasis on strategic growth, niche specialism, and tapping into burgeoning markets in Asia. That is how Ron Whyte, head of Asia, and Mike Papworth, managing director of international, described the broker’s vision to Intelligent Insurer.

Speaking at the 19th Singapore International Reinsurance Conference, Papworth said: “We are developing our focus of growing organically and specialising in niche specialist areas, which is the company’s key differentiator”.

“We don’t do everything, but what we do, we do extremely well,” he said. While the company has growth plans across the UK and Europe, there’s a pronounced focus on Asia.

One of Miller’s core strengths has been facultative reinsurance mainly on large energy accounts, Whyte highlighted. He said the idea is to expand business in three primary areas: geographic footprint, product line and retail presence.

He elaborated that the company doesn’t believe in “planting flags everywhere” but will choose strategic territories in line with its own growth evaluation and shareholder judgement.

It has already set the wheels in motion with a specialist marine broker Lead Insurance Services in Japan last year, and is currently in talks to expand into Malaysia, Indonesia, and potentially Hong Kong, he explained.

Miller acquired Lead Insurance Services in July 2022, a move it said cemented a longstanding relationship between the two businesses. Founded in 1994, Lead specialises in hull, war risks and protection & indemnity insurance. It had been working alongside Miller for a quarter of a century. The idea is that it will enable Miller to build on its existing strength in the marine space—a key class for the broker.

Focus on diversifying

In terms of product line augmentation, while Miller has a full suite of insurance products in London and Paris, the emphasis is now on diversifying even further. Recent initiatives include establishing a “more robust” energy practice, construction and renewables and general upstream downstream energy and power.

The plan is to move further into financial lines specialties, while also expanding in the treaty arena and focusing on “core strengths”.

“Later this week, we have a financial lines specialist starting to move us into that area,” Whyte revealed. “And we’ll be looking at other areas such as credit and political risks and accident and health, and mirroring where it makes sense or expertise lies in due course.”

On the distribution front: “when we move into some of the selected areas, we will be looking at establishing a retail presence, including potentially here in Singapore,” he disclosed.

Whyte highlighted that each of these strategies is underpinned by Miller’s ability to “attract heavyweight leaders” and support from its investor Singaporean sovereign wealth fund GIC.

According to Whyte, the Asian market isn’t particularly “hard” when compared to places such as the US or Australia. Rates are “still pretty much lower” than in other parts of the world. However, in response to the aftermath of hurricanes and secondary perils, it has become “difficult by Asian standards”.

“Asia is a huge growth area,” Whyte said. “But while Asia is vast, it might not be as big as most people think it is. It’s definitely not yet half the world’s insurance premium,” he said.

“We’ve seen a flattening of the market on pretty much all lines over the last three to four years,” he added, expanding on the current market conditions in the region.

“On the direct and facultative side, in the last two years, the treaty market has become tougher, particularly for catastrophe perils.”

“I certainly don’t see any significant softening in any business any time soon, certainly in Asia,” he noted.

“Having said that, when you go back to primary insurance, many of the original buyers of insurance are under pressure because of high interest rates and slow economic conditions. It is therefore going to be very difficult to continually get them to pay more for their insurance,” he explained.

“At some point it has to stop because they will simply be unable to pay the premiums that the reinsurance industry is trying to drive through,” Whyte concluded.

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