3 July 2020Insurance

Hiscox launches consortium for ‘hard to place’ risks with RKH

Specialist global insurer Hiscox, together with RKH Reinsurance Brokers, have launched a new variable consortium for ‘hard to place’ general liability risks such as wildfire, trucking and construction.

The consortium is the third of a suite of US liability consortia led by Hiscox, and has been put in place to respond to a "shortage of capacity in harder-to-place areas of the excess and surplus lines market, which fall outside of the scope of their existing consortia".

The consortium will enable Hiscox to bind capacity on behalf of their follow market, whilst allowing consortium members the flexibility to respond to more challenging and specialist risks while increasing the efficiency of the placement process.

Combining the capacity of six Lloyd’s syndicates, the variable consortium will be open to large risks domiciled in the US and has bound $1 million GWP. The consortium will offer a maximum line of over $20 million for a range of challenging general liability risks.

Ed Wallis, general liability line underwriter at Hiscox London Market, said: “Realising that some of the larger risks in highly exposed industries have been struggling to find capacity, we have been pleased to collaborate with RKH Reinsurance Brokers to put a truly innovative market response in place. The variable consortium offers general liability brokers and their clients a valuable point of entry for London market capacity, and will bring risks into the Lloyd’s market that might otherwise struggle to find a home.

“Our consortium members have given us the mandate to consider a broad spectrum of risks in capacity-challenged areas of the liability market, on the basis that they need not be constrained by a predetermined share of the portfolio. This allows them to vary their line according to the risks we put in front of them, allowing us to aggregate a larger amount of capacity than we might otherwise be able to obtain through a traditional consortium structure when the right opportunities present themselves. Ultimately this means we can be of greater service to our clients when they need us most.”

Tom Gauge, an executive director at RKH Reinsurance Brokers, added: “We were delighted to work with Hiscox to bring true innovation to the consortium placement process, which in turn has enhanced their product offering, and ultimately the ability of the Lloyd’s market to respond to its clients in a challenging trading environment. As specialists in Lloyd’s consortia at RKH Reinsurance Brokers, we recognise the value that these structures can bring to the Underwriting Room in terms of capacity, distribution, and expense management, and the important role that they will no doubt play as the Lloyd’s market reassesses how risks can be placed most efficiently. ”

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