Podcasts Fidelis’s Brindle & Coulson: Leveraging Lloyd’s strength AdvantageGo 5 Min Read 10.10.24 AdvantageGo Content Podcasts Richard Brindle and Richard Coulson discuss the onwards evolution of Fidelis, after its bifurcation into The Fidelis Partnership and Fidelis Insurance Group. Group CEO Richard Brindle is confident that the market response to Fidelis’s new structure has been a good one – with no reservations or objections expressed from brokers or clients. The question now is how the bifurcated group will continue to evolve, between its re/insurance carrier business and The Fidelis Partnership, with Richard Coulson as its CEO of insurance and deputy group chief underwriting officer. Brindle revealed the reason for The Fidelis Partnership’s nomenclature is his dislike for the managing general underwriter (MGU) term, which he thinks carries negative assumptions about a narrow line of business focus and short-termism horizon driven by capital in flux annually, neither of which applies in this case, with more than 100 lines of business and the group’s carrier as the primary long-term capacity provider. The two execs were interviewed by Voice of Insurance podcast host Mark Geoghegan at the recent Monte Carlo RendezVous event in Monaco, a get-together for global deal-making and starting gun for renewals conversations in the reinsurance market. A Lloyd’s syndicate, numbered 3123, reflects what Brindle sees as a turnaround in the market’s fortunes, as well as its “fossilised social attitudes”, since reclaiming a more positive culture as an environment for thought leadership and a stronger place to do business. Brindle describes the syndicate business as “incremental to the Insurance Group, which they can’t access by means of licensing, counterparty limits, credit rating, or all of the above”. When Brindle joined the London market, he said Lloyd’s was still dominant for property catastrophe reinsurance business, and he was used to taking leading positions on the broker slips. There is still much to do to bring back London to its leadership position, he suggests. “Now, Lloyd’s is often under 10% and a lot of major clients don’t even go to London anymore because the money’s all in Bermuda, and they go there,” Brindle said. “It’s a case of Lloyd’s moving back out of the margins into this position of leadership. And I think John [Neal, CEO] and Patrick [Tiernan, chief of markets] regard us as absolutely essential to that process.” Coulson observed that “the Lloyd’s brand internationally is incredibly strong”, which is beneficial for the ongoing international buildout of Fidelis and its Partnership arm. “We’ve been very pleasantly surprised also by the appetite to this lead and follow point of other syndicates reaching out, recognising our leadership position in certain niches or certain portfolios of lines of business, and looking to us to set up consortia to lead lines of business for others to follow,” he said. Working in the “collegiate” environment of Lloyd’s, Brindle noted a pet hate of “signing down” business, that is “doing all of the work”, only for others to “come along for the ride”. “We lead or co-lead over 90% of our business. We can’t lead absolutely everything, but if we don’t lead it, we should be seeing it second or third, right on the shoulder of the leader, a bit like a 10,000-meter runner – that’s where we should be,” he said. Consortia provide a consistent percentage of the action, Coulson noted, while building a critical mass of capacity, giving more influence within a placement. Conversation turned to the need to innovate. Innovation is moving back to the fore at Lloyd’s, Mark suggested, with the corporation keen to “get out of the way” of innovators, although like evolutionary theory, “not everything works out”, such as the market’s attempt to develop an “intellectual property class” of business. “We always pride ourselves on wanting to innovate and trying to address shortfalls of market capacity. When you look at the amount of intangible assets in the world, and insurance focus on serving the tangible asset world, there is certainly space for products there to address that gap,” Coulson said. “Lessons learned, insurance is all about alignment of interest, also about timing. When we launched the product, it was at a time of stressed credit conditions in the market. The early adopters and early clients in the product unfortunately fell victim to those conditions,” he continued. “At the moment, there’s a gap between what clients want and what structures will float versus what we would need for it to be insurable. It’s a question of ‘if and when’ we can bridge that gap,” he added. Climate change represents a major innovation opportunity, according to Coulson. Environment, social, governance (ESG) for traditional energy business represents an area of product innovation for Fidelis Partnership, he explained, based on clear criteria for ESG transition and measurable targets that are for next year, not 2050. Traditional assets need insuring, as well as construction projects for renewable, green energy. Plus products such as political risk and decommissioning of assets, as well as new ESG elements such as carbon credits and carbon storage. “That’s been very well received. I think there’s a bit of a misconception that energy companies wouldn’t want to engage on this stuff,” Coulson said. “They face questions from their own investors around what their transition plans are, etc, so it’s an extension of that, that they would talk to their insurance providers in the same way.” Previous PodcastNext Podcast Knowledge hub Visit our knowledge hub to make informed decisions on your (re)insurance transformation. Visit knowledge hub Oops! 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