Building a challenger broker
Four years into a project to rebuild Lockton Re into a challenger reinsurance broker, two of the business’s architects spoke to Mark Geoghegan for an episode of his Voice of Insurance podcast.
Only four years ago, Lockton Re was a smallish London market reinsurance broker, with fewer than 40 staff, focused on international casualty business.
Since then, its parent company Lockton took advantage of the consolidation going on in the top tier broker market to build – organically – a much larger broking animal.
Starting from an almost blank canvas, Lockton Re takes a “Swiss Army Knife” approach – it wants brokers who are not ‘company men’, but rather people who think flexibly about different tasks and capabilities – prepared to find new ways of doing things.
“It’s an early self-selection process. The people who are excited, lean in very quickly, and the people that are timid and don’t want to do it, lean out,” said Tim Gardner, CEO of Lockton Re, speaking on the podcast.
Fast-forward to 2023 and the firm has major reinsurance broking hubs in the US, Bermuda, London and Zurich, placing everything from regional US market business to specialty lines.
“We’ve got infrastructure, we’ve got people, we can point to clients, we can point to wins,” said Bob Bisset, Lockton Re’s chairman for global retro and property specialty, Bermuda and market capital.
“The conversations we had with folks to try and get them join Lockton Re a couple of years ago was that leap of faith. ‘Come on board. We’ve got all the ingredients to make a fantastic dinner, come join the dinner party’…Now we can say, ‘we’re enjoying the meal. Come have a bite, it’s really good – it’s delicious.’”
Among myriad challenges overcome in the past few years – such as navigating a turn in the market cycle, and onboarding all the new teams and talent – there is also the ongoing challenge of digital transformation. For Gardner, this is about levels of service standards, which he said he thinks have slipped for the sector.
“We spend a lot of time and money on the tools that we use behind the scenes for claims and premium processing, on how we capture quote information, placement information and bound information,” he said.
“It’s with the idea that we’re going to serve all that back to serve our clients better. It’s not flashy, it’s not glittery, it’s your foundational items to build the business the right way,” Gardner continued.
Meeting a reinsurer recently, this focus in conversation struck a chord. “We want to be brilliant at the basics. If you’re brilliant, the basics, the tougher stuff gets a lot easier,” Bisset said.
Gardner added: “One of the cores of our value proposition is ‘born digital’. To be able to build new without unpacking old legacy infrastructure has been a Godsend.
“We can do things that we never would have been able to do in prior lives, simply because there’s too much there to try to unpack before you can build something that’s new and compelling.”