Antares: Asian launch partly a defensive move
Steve Redmond, the managing director of Antares, a member of the QIC Group, has said the company’s recent launch on the Lloyd’s Asia Platform in Singapore was partly a defensive move to ensure it still sees business now being underwritten in Singapore as opposed to London.
He said the growth and success of Singapore as a risk transfer hub combined with the growth of the Lloyd’s platform based there has meant it is increasingly necessary for London companies to get closer to their clients in Asia and establish a presence in the market.
“We have been looking at Asia for a while. It contains many of the fastest growing emerging markets and we see many opportunities there. But we are also conscious that there is a lot of business which might once have come to London but which is now staying local in Asia,” Redmond said.
“We decided that we needed to get closer to our clients and expand the distribution base. Although it is a slightly defensive move, it is also a very positive message. We have a good knowledge of the market but we are also looking to recruit local talent and empower our underwriters on the ground.”
Antares Underwriting Asia, which has received approval from the Monetary Authority of Singapore and Lloyd’s Asia to begin underwriting from November, will initially underwrite a core portfolio of marine, property and specialty products before looking to expand.
The new unit will be led by Li Shan Yeo, who joins as chief executive from Zurich, where she served most recently as chief underwriting officer of Zurich Singapore. Prior to this, Li Shan spent seven years at Federal Insurance Company culminating with her appointment as Asia INT & Life Sciences Casualty Specialist.
“Our new business on the Lloyd’s Asia platform represents the next step in the future of Antares. Our ambition is to build a truly global specialist underwriting business. We are committed to developing Antares Asia into a leading specialist Asian insurer,” Redmond said.
Redmond added that Antares regards Singapore as a gateway to the rest of Asia but also admits there will be no easy wins for the business in the region. He said he believes market conditions in Asia are even tougher than in other parts of the world, and that discipline and a measured approach will be important for Antares.
“The reality is that conditions are tough everywhere. We just need to ensure that we operate the best we can in a profitable way and understand that there is a level on rates beyond which we simply cannot go.” He added that the emphasis on speciality business in the region will also suit the company’s skillset.
Despite the tough conditions at the moment, he said the move in Asia is a long-term play for Antares. “We see it almost as somewhat too big to avoid and we see some excellent opportunities there long-term. We know the region well and we have some excellent contacts but we will also be recruiting new talent.”
There is much talk in Asia at the moment around the opportunities that new regulatory regimes may generate as different countries move towards risk-based capital models. Redmond said he agreed that some insurers will use reinsurance as a solution in some instances but he also stressed that every case will be different.
China’s new C-ROSS solvency regimes, for example, will favour insurers writing a high proportion of motor business. In some instances, he said, they may need less reinsurance as a result.
In contrast, insurers writing many other lines could find themselves burdened by higher capital charges, which could be alleviated through the use of reinsurance.
“The situation will differ from company to company. There will be no consistent outcome, I believe,” he said.
He added that the continued overcapitalisation in the market and the implications of this would be a big talking point at SIRC, as would the ongoing loss estimates and uncertainty around the explosion in Tianjin, China.
“It has illustrated how complex losses can be and will certainly change perceptions on that market,” he said.
