RSA restructures London market business, exits three lines as profits slump
RSA Insurance Group has revealed its plans to scale back London Market exposures and restructure its specialty and wholesale business following a strategic review of all of its portfolios.
The insurer has concluded that its international construction, international freight and fixed price marine protection and indemnity insurance business lines are unlikely to satisfy the group’s profitability requirements in the foreseeable future. Hence, RSA is exiting these lines of business with immediate effect or at contract expiry.
RSA’s London Market business, reported as part of RSA’s UK and International region, will now focus on four key specialisms, including international hull; international cargo and transportation; international property; and international engineering and renewable energy risks.
RSA said these core portfolios, whilst subject to rigorous and selective underwriting, will allow it to concentrate on areas of existing strength and establish a platform for profitable growth in the future.
The changes are part of an ongoing review to streamline the group’s international exposure, improving underwriting, pricing accuracy and risk management.
RSA’s London Market portfolios in international marine cargo and international marine transportation will be restructured into one unit under new leadership, with exposures in both areas significantly reducing as the company focuses on targeted areas where sustained profitability can be achieved.
According to the insurer, these actions are expected to reduce premiums written through the London Market by RSA by around one third year on year (2018 vs 2019).
“RSA has historically served the London International Specialty and Wholesale market across a broad range of products and exposures,” said Steve Lewis, CEO RSA UK & International. “The changes we are making to our portfolio will enable us to take a much more targeted approach, focusing our efforts on specialist areas where we have market leading expertise and capacity. We will continue to evolve and build on this strategy over time in order to deliver sustained value for our customers and shareholders alike,” Lewis noted.
Tony Buckle, managing director of RSA global risk solutions, added: “As a specialist insurer to the London Market, RSA will offer distinctive, best-in-class propositions to our customers in the segments on which we are focused. This will enable us to develop and sharpen our expertise, and manage our exposures and volatility more effectively. We will be working closely with our customers and their brokers to assist them in a smooth transition.”
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