Moves & Views (October 01, 2010)

1 ACE Limited has acquired Rain and Hail Insurance Services Inc. for approximately $1.1 billion in cash, subject to regulatory and shareholder approvals. Headquartered in Johnston, Iowa, Rain and Hail is the second-largest crop insurance underwriter in the United States and Canada. ACE says the transaction is expected to be complete by the end of 2010. Prior to the acquisition, ACE owned approximately 20% of the

outstanding common stock of Rain and Hail. Rain and Hail will continue to operate as a separate and distinct franchise with the company’s ACE Westchester division and Insurance-North America operations. ACE anticipates a return on capital in excess of its 15% hurdle rate, or the minimum acceptable rate of return.

2 Gilbertson Davis Emerson LLP has recruited accident benefits and insurance defence counsel Joan Takahashi to its team of insurance lawyers. Takahashi previously practised with a large firm in Toronto and has nearly 20 years of insurance defence experience. She also spent more than 10 years working in the insurance industry in multi-line claims adjusting, as well as in super-number visory roles in casualty and property, personal and commercial lines.

3 Hub International Limited (Hub) has acquired the shares of Sinclair Cockburn Financial Group (SCFG), a Toronto, Ontario-based insurance and financial services firm with approximately $11 million in annual revenues. Under the terms of the acquisition, Hub acquired the property and casualty, personal insurance and group/life insurance operations of SCFG, but not SCFG’s mortgage and mutual fund business. Jim Aston, Kelly Sinclair and Jim Grieve, SCFG’s three majority shareholders, will all join Hub as part of this transaction. Grieve, president of SCFG, will become part of Hub Ontario’s leadership team, reporting to Neil Morrison, president and CEO of HKMB Hub International Limited. Established in Toronto in 1953, SCFG is a diversified insurance and financial services company with more than 15,000 customers operating throughout Canada. In addition to its Toronto headquarters, SCFG also operates out of Pickering, Ontario. SCFG received the Insurance Brokers Association of Ontario’s Brokerage of the Year Award of Excellence in 2009. The brokerage specializes in a of areas, most notably a professional liability unit focused on architects and engineers. Other practice areas include construction, surety and national programs (horticultural trades, dairies, non-profits and other retail programs).

4 Chesterfield Canada has brought its sabotage and terrorism product to the Canadian market. The product expands the scope of the terrorism peril, which is traditionally defined as an act of a foreign government or organization. Under Chesterfield’s product, the peril would also include the act of domestic individuals or groups with a grudge against a business or institution. There have been a number of high-profile incidents of property damage around the world in which terrorism insurance provided inadequate coverage, said Gary Hirst, Chesterfield Canada’s director of marketing. “In the hour of need, when you expect your insurance policy to respond and it doesn’t, we want to offer clarity in the coverage our clients buy from us.”

5 The Insurance Institute of British Columbia has announced its 2010-2011 governing council. Mike Dakin [5] of ICBC will serve as president. Wes M. Chowen of Pat Anderson Insurance Group will serve as first vice president, academic division. Pierre Chavigny of Claimspro is the new second vice president, professional division. Jan Brownridge of Munich Reinsurance Company of Canada will be the council’s new secretary and treasurer.

6 A key rainmaker in the insurance industry, Robert Clements, died of cancer at the age of 77 on Sept. 4. Clements was co-founder and non-executive chairman of Integro, an insurance broker and risk management firm, and most recently founded and was a director of Bermuda-based Ironshore. At Integro, John (Jack) Byrne will succeed Clements as chairman of the board. Prior to co-founding Integro in 2005, Clements was chairman of Arch Capital Group Ltd., which he established in 1995 following a long career at Marsh & McLennan Companies Inc. At Marsh, he was president and member of the board of directors. He also was the founder of Marsh & McLennan’s private equity business, MMC Capital Inc. He served as MMC Capital’s CEO until 1996. “Bob Clements had a legendary career, immense impact on the insurance industry and was a mentor to many of us in it,” Integro president and CEO Peter Garvey said in a statement. Clements, a graduate of Dartmouth College, is survived by Marilyn, his wife of 55 years, his four children and their spouses and 12 grandchildren. Byrne joined Travelers Insurance Company, early in his career and subsequently burnished his reputation with the turnaround of a struggling GEICO, which he joined as CEO in 1976. A rags-to-riches story, GEICO was subsequently sold to Warren Buffett. Byrne and Buffett then worked together at the Fireman’s Fund, the largest IPO of its time. Byrne continued to lead White Mountains Insurance Group, a financial services holding company, after the sale of its Fireman’s Fund division to Allianz of Germany in 1990.

7 Applied Systems Client Network (ASCnet), the users group for Applied Systems’ agency management technology, has elected Brian Bartosh [7a] to serve as its 2011 chair. Bartosh is the president of Top O’ Michigan Insurance, based in Alpena, Michigan. Maureen Boeing [7b], vice president at Landmark Insurance Agency in Cincinnati, has been elected ASCnet’s 2011 vice chair.

8 XN Financial has launched XN Special Risks, a virtual storefront providing Canadian insurance agents and brokers online access to a broad range of domestic and international specialty product lines. XN Special Risks’ online systems are designed to enable agents and brokers to submit insurance applications in a one-step, real-time process, thus expediting the paperless management of insurance programs. “Our virtual storefront creates a competitive advantage for brokers, as the rating, quoting, binding and issuance of insurance documents is facilitated by our simplified Webenabled applications,” said Dan Anber, president and CEO of XN Financial. XN Special Risks products are supported by Lloyd’s of London and other domestic and international insurance carriers.

9 Compu-Quote announced the launch of a quoting module for individually rated commercial automobile (IRCA). The service is available via Compu-Quote’s AutoRater to brokers with rates for Aviva Canada, AXA Insurance, Intact Insurance and The Economical Insurance Group. The IRCA quoting application is a Web-based module, embedded in AutoRater, designed to provide full underwriting and simultaneous, comparative quoting for multiple IRCA rate plans in a given province. It works in conjunction with the current CQ Commercial Quick Quote Module, but is enhanced to permit the gathering of additional IRCA specific underwriting and rating data. The application provides for quoting for additional classes, allow for expanded policy coverages and limits and offer expanded endorsements and policy forms.

10 Issurances Evolution Inc. has agreed to offer Ironshore Canada Ltd.’s specialty casualty risk to the Quebec market. This is in addition to offering Ironshore’s financial and professional lines, environmental liability and specialty property and marine products to the Quebec market. “This agreement enables us to expand our product base beyond our current casualty focus and broaden our present underwriting appetite,” said Yves Daigneault, Evolution’s president. Mike Wills, Ironshore Canada’s president and CEO, said Evolution’s local presence, service, innovation and expertise will strengthen Ironshore’s relationships with Quebec brokers and clients.