Fidelis Partnership holds firm on principles amid PV’s competitive market

TFP’s Billy Ayres says the MGA remains disciplined as evolving risks test the resilience of underwriters in a fiercely competitive political violence marketplace.

The political violence and terrorism (PVT) insurance market has endured a turbulent five years, shaped by a wave of geopolitical shocks—from mass unrest in Chile to the full-scale war in Ukraine and the recent flare-ups of violence in the Middle East.

For Billy Ayres, Head of Terrorism at The Fidelis Partnership (TFP), a managing general agent backed by capacity from Fidelis Insurance Group, the market remains in a state of dynamic change rather than any settled maturity.

“The PVT market is, by the nature of the coverage provided, required to evolve rapidly and needs to change constantly in order to be relevant to the developing geopolitical and security risk environment,” said Ayres.

“It has ‘matured’ since the creation of the stand-alone PVT product but there will always be a requirement for it to change fast in response to clients’ needs.”

He said the underwriting team at TFP had always focused on providing solutions, especially during moments of heightened risk.

“We are proud of our reputation as a lead market and are often prepared to offer a quote even for heightened risks to help clients navigate what can be a very fast-changing geopolitical landscape,” he added.

Soft but dangerous

Despite the increased complexity of global threats—from strikes, riot and civil commotion (SRCC) to terrorism and state-backed sabotage—the political violence market remains soft and fiercely competitive. Capacity deployed by insurers keen to grow specialty lines continues to outweigh demand, despite the volatile risk environment.

“Our approach is to flex our appetite to where the market is best priced,” said Ayres.

“Although the market is soft in places, this is not uniform, and we still see opportunity for disciplined underwriting in a number of areas, based on our view of risk.”

He acknowledged that recent years had seen some improvements in pricing.

“The new capacity coming in, and short-term memory that certain participants in the market have a tendency towards, is driving some of the price decreases being seen, but we will stick to our very clear underwriting principles,” he said.

As 2024 unfolded, with dozens of national elections scheduled across the globe, insurers braced for a wave of potential losses tied to unrest and political instability.

“To date, we have not seen any significant claims for ourselves or the PVT market,” said Ayres.

“While a major election year, this did not materialise in any major SRCC events or losses. However, the losses and political unrest witnessed in the French overseas territory of New Caledonia should serve as a timely reminder as to why insurers need to adequately price, aggregate, and underwrite PVT perils.”

Discipline and diversity

Ayres stressed the importance of robust exposure and portfolio management, pointing to the firm’s analytical frameworks and internal modelling.

“The Fidelis Partnership has always had a very disciplined approach to risk management and aggregation, and this is no different for PVT,” he said.

“In particular, with the PVT class, we have always understood the importance of having clear aggregate and exposure frameworks in place for various perils. We define this by looking at the varying threat levels in each country around the world and overlaying this with our own view of risk.”

That localised view is critical to risk selection, and TFP’s team is encouraged to avoid relying too heavily on familiar data sets or perspectives.

“Collaboration is absolutely core to how we underwrite,” said Ayres. “We draw on experience from across the underwriting team, helped by our daily underwriting call and the fact that every day our underwriters are in the office all together.”

For such a politically driven risk environment, he stressed the team makes a conscious effort to view the world without skew or bias.

“We are also very mindful of avoiding bias, for example not focusing on western media and ingesting a broad range of sources. Our underwriters are often travelling, which helps us to have a wider perspective, and we are a company that celebrates diversity of cultures, languages and views.”

Judgement counts

Unlike some commercial insurance lines increasingly governed by modelled pricing and analytics-driven processes, PVT remains a class where human judgment retains outsized value.

Ayres said the Fidelis Partnership maintains a broad toolkit, balancing structured data with on-the-ground insight and geopolitical context.

“We work very hard to make sure we are not overly reliant on one source of data or analytics,” he said.

“We want to make sure our decisions are based on as broad an understanding as possible.”

He added that pricing and underwriting also need to account for deeper realities than physical security alone.

“We will also seek to understand the risk environment beyond the physical protections a site has—so examining what is going on behind the scenes locally, and the underlying political context.”