Reinsurance broking stalwart on how the sector has evolved

Reinsurance broking stalwart on how the sector has evolved | Insurance Business Australia

Reinsurance

Reinsurance broking stalwart on how the sector has evolved

And what sets the broking market in Bermuda apart from its peers?

Reinsurance

By
Mia Wallace

With a host of professional designations to his name and decades spent serving the re/insurance market, including as CEO of both Lloyd’s and non-Lloyd’s brokers in the UK and Bermuda, Bermuda Brokers’ Neil Hitchcock (pictured) has seen the market through fair and foul winds alike.

Having started his career with a Lloyd’s Syndicate, Hitchcock said he greatly enjoyed his first foray into the Lloyd’s market, before moving to Bermuda in 1997 with a role at an MGA writing for Clarendon Insurance Group – which was then acquired by Hannover Re.  As part of that transaction, he said, the MGA became part of Hannover Re and he joined the business’s Bermuda office.

“In 2000, I was still at Hannover Re and looking to raise capital with some partners to set up a new reinsurance company to write US excess workers’ compensation on a treaty basis,” he said. “Back in those pre-9/11 days, we were looking to raise about $150 million, which seemed like a lot of money back then!”

Plans were progressing strongly for the development of the reinsurance company throughout the year 2000, with AM Best suggesting an A-minus rating was achievable. At the end of 2000, he said, the team set up a broker in Bermuda which would be wholly owned by the management and used to place some of the business into the proposed reinsurance company and secure its own outwards reinsurance.

How 9/11 changed reinsurance broking in Bermuda

The new millennium continued into 2001 and was soon rocked by 9/11 which brought a flood of new entrants into the Bermuda market; many bringing north of a billion dollars on their balance sheet.  In early 2002, it was clear the company wouldn’t attract the level of capital required to compete or receive its A-minus rating given the new market conditions.  With the plan “back on the shelf” he remained with Hannover Re until 2003 when he first ventured into the reinsurance broking world.

How Hitchcock came to Bermuda Brokers

Over the course of the next 15-plus years, Hitchcock held a number of positions at some of the biggest names in broking including Tysers and Gallagher, before becoming chief executive officer at the specialty re/insurance broker Skyfront Insurance. In 2022, he said, he joined the Bermuda-based, specialist reinsurance and insurance intermediary Bermuda Brokers Limited as chief reinsurance officer.

As to why he stayed on the broking side of the fence, Hitchcock highlighted how much he enjoys being part of the reinsurance distribution ecosystem.  As somebody who enjoys building strong relationships across the market, he said, it’s a great sector to be part of and nowhere is this emphasis on the power of great relationships more clear than on the ground in Bermuda.

“That’s what’s especially great about being with Bermuda Brokers,” he said. “So much of the business placed into Bermuda is handled remotely, with overseas brokers visiting the island only a handful of times a year or meeting at overseas conferences.  Whereas by being here, we can walk around and see them and connect with them that way.

“Having that personal element is really appreciated, because it means you can do business face-to-face rather than always being at arm’s length. Many underwriters who have come to Bermuda from a Lloyd’s background, in particular, are used to seeing brokers face-to-face and building those relationships with them.”

How is the Bermuda market different to the London Market?

Hitchcock noted that the way Bermuda is structured is quite similar to the London Market, in that it’s easy to get around and see each other. Coming into Bermuda makes it easy to see a large number of markets in a couple of days, he said, which is a key component in making the sector so dynamic. It’s also a highly creative market with markets more freely able to ‘think outside the box’ or look at something new, which isn’t always the case these days in London.  

“Lloyd’s still works very well and boasts a lot of very talented individuals,” he said, “but there’s no doubt that it moves less quickly and decisively than the Bermuda market in many instances.”

There’s a real appetite in Bermuda for the “weird and wonderful” as well as traditional risks, he said, and for making decisions with speed and agility to keep up with the emerging risks and opportunities facing the sector. There’s also a great deal of flexibility in the Bermuda market, and he highlighted the role the Bermuda regulator has played in creating these market conditions.

“The regulator here is very effective,” he said. “[The BMA] know what they’re doing, and they’ve come so far in the last 25 years. There’s good collaboration between the regulator and the market here, which translates into real speed to market. There’s also a lot of great talent in the market down here, which I think is a large part of why it all works so well.”

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