Torus Implements Leading-Edge Claims Technology

Torus, the global specialty insurer, today announced the implementation of its new, state-of-the art claims management system, GuidewireClaimCenter®.

Unlike the majority of insurers who rely on older, multiple platforms, Torus has implemented ClaimCenter as its one global claims management system to support its entire product suite, standardising claims handling processes to deliver enhanced claims efficiency and improved speed and accuracy of claims payments for Torus customers worldwide.

“Our aim is to be a world class claims team,” said Rob Powell, Chief Claims Officer. “This initiative evidences our progress and allows us to demonstrate our success. The investment clearly shows Torus’ commitment to embed claims into the Torus brand. It underlines our willingness to pay philosophy.”

Torus selected Guidewire largely on the strength of ClaimCenter’s flexibility to manage claims globally across a diverse product portfolio. Importantly, this has allowed the system to be adapted to work directly with London Market Messages. This is especially timely given the recent pressure from Lloyd’s on London’s insurer and brokers to engage more fully with the electronic endorsements process.

“Torus is meeting and exceeding industry demands with regards to ECF2,” said Mr. Powell.

“Working closely with Business Agility Group Ltd, ClaimCenter has been fully implemented and integrated with all Torus’ technology platforms in under twelve months,” said Michael Kim, Chief Administrative Officer. “It further demonstrates Torus’ commitment to leverage the latest information technology to deliver consistent, high-level service in real-time to our customers throughout the quote, purchase and claims settlement process.”

Professional Lines Market Faces Uncertainty, Torus Survey Finds

A recent survey undertaken by global specialty insurer Torus has revealed a Professional Lines market in flux with widespread concerns over pricing uncertainty in 2012, a heightened awareness of the current regulatory environment and fast-emerging new risks for small businesses.

Designed to identify key issues affecting the management and professional liability insurance market, the Torus survey found that market uncertainty is the central theme within the professional lines space and will likely drive decision making in 2012 and beyond.

“Insureds are facing a fast-moving market,” said Jeffrey Grange, Senior Vice President, Head of Professional Lines at Torus. “Every possible dimension of risk is changing and fears of increased prices and gaps in coverage are growing concerns among professional liability insurance buyers. The evolving nature of existing risks and emerging new exposures require insurers to be flexible in order to respond to the changing needs of customers. Specialist expertise is needed now more than ever to steer insureds through the multifaceted challenges faced.”

The survey polled attendees at the 2011 Professional Liability Underwriting Society (PLUS) International Conference in San Diego, Calif., which was held Nov. 2-4.  It includes responses from brokers, agents, insurers and risk managers.

Pricing Uncertainty Continues To Be Major Concern
With 2012 renewals fast approaching, the survey highlights that pricing uncertainty pervades. Thirty percent of respondents affirmed that the changing pricing environment is a major cause for concern, viewing it to have the biggest overall impact on the market over the next 12 months.

“As we move into 2012 we are seeing a transitional market,” Mr. Grange said. “We’re beginning to see an uptick in prices. The market needs to be prepared for increases where insureds have sustained losses and/or increased exposure.”

Respondents also note that an increase in market competition (25 percent), the current regulatory environment (23 percent) and the creation of new products (17 percent) were also major concerns.

Market Prepares for Impact of Dodd-Frank and HITECH Acts
When asked which legislation will have the greatest impact on the Management and Professional Liability market over the next 12-18 months, more than a third (35 percent) of respondents declared the Dodd Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank) as the legislation to watch. This was followed closely by the Health Information Technology for Economic and Clinical Health Act (HITECH Act) (22 percent), as well as the Fair Labor Standards Act (17 percent).

With its overhaul to corporate governance and financial disclosure, Dodd-Frank is massive in scope.  It extends the reach of regulatory oversight to private and public companies and moves far beyond the Sarbanes-Oxley Act of 2002. Consequently it has garnered significant industry attention.

Forty-four percent of all respondents say the biggest impact of the legislation will be a higher number of internal corporate investigations. An additional 29 percent believe that the impact will be felt in a greater need for loss control services, while another 15 percent believe Dodd-Frank will result in more whistleblower lawsuits.

“The insurance industry is paying very close attention to the Dodd-Frank Act,” said Mr. Grange. “As the regulatory pendulum moves away from insurers, we must now take the time to understand that insureds are operating in an environment of heightened legal liability. The impacts of Dodd-Frank will be far reaching and will likely lead to increased compliance costs, new avenues of liability and potential litigation for both public and private companies. We must also be aware that the inclusion of whistleblower provisions will likely lead many corporations to seek insurance products that address the risks associated with these investigations.”

An additional one in four (25 percent) respondents believe the overall globalization of privacy legislation will have the most impact on the Management and Professional Liability market.

Small Business Risks Abound
According to the insurance professionals surveyed, they and their small business clients are focussing on new and developing risks. Nearly two out of three (61 percent) of survey respondents noted privacy and network security as topping the list of risks that the insurance industry needs to be concerned with, compared to five years ago. Respondents also feel that small businesses need to be made more aware of increased regulation (14 percent), increased contract requirements needed to purchase E&O coverage (12 percent) and new employment laws (12 percent).

“The risks faced by small businesses today are far different than they were even just a few years ago,” said Mr. Grange. “Insurers must make a concerted effort to better understand how technology has heightened small businesses risk exposure. As new exposures emerge, underwriters must adapt and work with small business customers to develop products that mitigate and transfer the risks that they face.”

Social Media Is Risky Business
While social media tools like Facebook, Twitter and LinkedIn have taken center stage as cost effective means for small businesses to distribute information and build brand recognition, the risks to the companies that use these tools has risen as a result. Despite this reality, many small businesses remain unaware of the potential liabilities that arise from the dissemination and proliferation of content and the delivery of professional services via these new mediums.

Thirty-five percent of survey respondents believe that the biggest risk small businesses must address when using social media is the lack of explicit risk management policies and procedures. This was followed closely by the risk of data leakage and theft (29 percent) as well as a lack of control of potentially damming content being disseminated by employees (24 percent). Twelve percent believe increased personal injury exposure (e.g. defamation, libel, slander) poses the greatest risk. 

Market Craves Technological Innovation
Over the last five years the market has seen a growth in technological advancement among management and professional liability products, portals and services. Yet respondents indicate that there remains a need for additional offerings. According to the survey, 38 percent of respondents seek greater risk management and analytics tools. One in five (20 percent) are looking for improved customer relationship/policy management systems, while 18 percent would like to see more efficient quote-to-bind portals. Fourteen percent want more readily available iPad/iPhone apps and tools while eight percent said they would like to see better automated claims reporting systems.

“There is plenty of room within the insurance industry to better and more accurately deliver consistent services and products in real-time,” said Mr. Grange. “Our industry as a whole lags behind others in utilizing technology to enhance customer experience so there is a huge opportunity for those that can leverage it and respond to the need for improved service delivery.”

Torus Strengthens European Property and Casualty Platforms with Senior Appointments

Torus, the global specialty insurer, has enhanced its offering in Europe with the appointment of Brian Byrnes as Senior Underwriter for General Property and Marco Sonntag as Senior Underwriter for Casualty. Based primarily in Torus’ Cologne office, Mr. Byrnes and Mr. Sonntag will lead General Property and Casualty underwriting respectively for the Austrian, German and Swiss markets.

Commenting on the appointments, Richard Etridge, Chief Operating Officer of Torus International said, “The current competitive market has created a dynamic environment with clients re-evaluating their panel of insurers to bolster stability and ensure risk programs meet their specific needs. For newer, more flexible carriers with the drive and expertise on board to respond, these factors provide a real opportunity to establish viable, long-term platforms in Europe.”

Dermot O’Donohoe, Chief Executive of Torus International added, “Torus strategy for sustained growth in Europe is to add value to customers though offering specialist expertise and unique solutions. This approach is proving particularly successful with sophisticated buyers.”

Mr. Byrnes, who reports into Franco Masciovecchio, Torus’ Head of General Property in Europe, has over 20 years of international insurance and reinsurance experience. He joins Torus from Allianz Global Corporate & Specialty, where he was Head of Property, Americas. Prior to Allianz Global he was Head of Property Facultative for Swiss Re in Munich and was instrumental in uniting the property facultative teams of GE Frankona and Swiss Re Germany. He was also Global Head of Property Facultative for GE Insurance Solutions (GE Frankona) in Munich.

Reporting into Thomas Guesde, Head of Continental European Casualty, Mr. Sonntag joins Torus from Sompo Japan Insurance Company Europe (Sompo), based in Düsseldorf, Germany, where he was most recently Underwriter and Competence Partner for all casualty lines for Switzerland, Austria, Germany and Eastern European territories. Previous senior roles include Underwriter at HCC Global Financial Products SL in Barcelona, Spain, Risk Manager for HOCHTIEF AG and Senior Advisor of Aon’s Global Casualty accounts for Aon Jauch & Hübener GmbH based in Mülheim, Germany.

Torus Announces U.S. Professional and Management Liability Primary Underwriting Capability

Torus, the global specialty insurer, last week unveiled its U.S. Professional and Management Liability primary underwriting capability at the 2011 Professional Lines Underwriters Society (PLUS) International Conference, (2-4 November).  Led by Senior Vice President, Head of Professional Lines, Jeffrey Grange, the offering entails a breadth of products across three segments:  professional liability, private company management liability and financial institutions.

The suite of products is available nationwide and, in many states, available on an admitted basis.  Products are targeted at professional service providers including media and entertainment content producers and distributors, information technology service providers and all forms of financial institution asset managers.

Furthermore, the Torus policy architecture is a ground-breaking, highly flexible modular policy architecture that enables agents and brokers to tailor coverage to fit the specific needs of their customers.

“Our broad suite of products was developed with a view to simplifying the professional lines market for both brokers and insureds,” said Mr. Grange, while at PLUS.  “And with extensive experience in underwriting professional lines risks, our team has created a policy architecture that is a radical departure from the notoriously complex policy wordings in this market.”

A One Stop Shop

Torus’ primary professional and management liability product suite addresses the full spectrum of needs for small and middle-market companies.  Understanding that exposures arising from technology, content dissemination and private and network security are now an everyday part of doing business, Torus has developed a one stop shop of offerings for producers and their clients.

The common product architecture enables customized underwriting treatment, consistency of policy language across all industry types and a superior user experience for producers and clients.

Professional liability primary product solutions exist for over 70 classes of risks, including:

  • Technology service providers
  • Media liability for both traditional and non-traditional publishing
  • Production and content dissemination and coverage for privacy violations and network security beaches
  • Delivery and failure to deliver professional services coverages

Management liability primary products include:

  • Directors & Officers Liability
  • Outside Directorship Liability
  • Employment Practices Liability
  • Fiduciary Liability

For financial institutions, Torus provides a full range of professional liability and private company management liability products for all types of financial institutions including:

  • Private equity
  • Venture capital and hedge funds
  • Private funds (including private real estate funds)
  • Investment advisers
  • Mutual funds
  • Family offices
  • Registered broker-dealers

In addition to these new primary products, Torus also offers excess products, including:

  • Excess Follow-Form (applicable to all primary professional and management liability products – private and public)
  • Excess Side A DIC
  • Excess Fidelity Bond
  • Excess Crime

For all products and customer types Torus can provide limits of liability of up to $10,000,000 per risk.

A Team of Experts

Over the last twelve months, Torus has put in place a team of professionals that brings strength in technical underwriting of complex management and professional liability risks along with in-depth customer knowledge.  The multi-disciplined underwriters are located in regional offices across the country to ensure timely service that facilitates direct underwriter service with insureds.

The Torus underwriting team is led by Mr. Grange together with Michael Philips, Senior Vice President, US Commercial E&O; Kenneth Fekete, Vice President, US Management Liability; David Donovan, Vice President, Middle Market National Segment Manager; Oliver Ade, Regional Vice President; Peter Shelton, Assistant Vice President; Annette Carrion, Assistant Vice President, US Commercial E&O, Chip Eibe, Assistant Vice President; Daniel Reinert, Director of Underwriting, Financial Institutions; and Debbie Hughes, Senior Underwriter.

A.M. Best Affirms Ratings of Torus Specialty Insurance Company and Torus National Insurance Company

A.M. Best Co. has affirmed the financial strength rating of A- (Excellent) and issuer credit ratings of “a-” of Torus Specialty Insurance Company (Torus Specialty) and Torus National Insurance Company (Torus National). Both companies are domiciled in Wilmington, DE and are wholly owned subsidiaries of their ultimate parent, Torus Insurance Holdings Limited (Torus) (Bermuda). The outlook for all ratings is stable.

These ratings are based upon A.M. Best’s group rating methodology and take into consideration the roles and strategic importance of Torus Specialty and Torus National to Torus’ overall U.S. strategy. The ratings also reflect the explicit support provided through substantial quota share reinsurance of Torus Specialty and Torus National’s net business by their U.K. based affiliate, Torus Insurance (UK) Limited (Torus UK). Additionally, Torus UK provides an aggregate stop loss agreement to Torus Specialty and Torus National. The ratings also reflect the implied support of future parental commitment.

Torus Specialty and Torus National maintain a strong stand-alone capitalization, which is driven by low underwriting leverage, negligible investment leverage and capital contributions from Torus. A.M. Best will closely monitor the operating performance of these relatively new companies given the execution risk to achieve business projections and the competitive market.

A.M. Best Affirms Ratings of Torus Insurance Holdings Limited and Its Operating Subsidiaries

A.M. Best Europe – Rating Services Limited has affirmed the financial strength rating (FSR) of A- (Excellent) and issuer credit ratings (ICR) of “a-” ofTorus Insurance (Bermuda) Limited (Torus Bermuda) (Bermuda), Torus Insurance (UK) Limited (Torus UK) (United Kingdom) and Torus Insurance (Europe) AG (Torus Europe) (Lichtenstein). A.M. Best has also affirmed the ICR of “bbb-” of the group’s ultimate parent holding company, Torus Insurance Holdings Limited (Torus) (Bermuda).

In addition, A.M. Best Co. has affirmed the FSR of A- (Excellent) and ICR of “a-” of Torus Specialty Insurance Company (Torus Specialty) and Torus National Insurance Company (Torus National) (both domiciled in Wilmington, DE). The outlook for all ratings remains stable.

The ratings reflect A.M. Best’s expectation that Torus’ consolidated risk-adjusted capitalisation will remain strong. Additionally, stand-alone risk-adjusted capitalisation at each Torus group subsidiary is expected to remain supportive of its rating level. Torus Bermuda operates as the recipient of the majority of the group’s risk through a 65% quota share and an aggregate stop loss of Torus UK. In turn, Torus UK provides the same cover to Torus Specialty and Torus National. Torus Bermuda also provides reinsurance support to Torus Europe through a 95% quota share arrangement.

Strong growth, catastrophe losses and the poor performance of excess liability business placed downward pressure on Torus’ risk-adjusted capitalisation in 2010. However, the actions taken by management during 2011, including the sale of the renewal rights of the group’s property treaty reinsurance business and the withdrawal from the Bermudian excess liability market, have significantly reduced Torus’ exposure to catastrophe risk and earnings volatility. These actions are expected to support the maintenance of the group’s strong consolidated risk-adjusted capitalisation.

In 2011, Torus is expected to report a technical loss in excess of USD 50 million, reflecting its exposure to natural catastrophes in the first half of the year, including the earthquakes in New Zealand and Japan and the Australian floods. Investment income from the group’s conservative portfolio of cash and fixed income investments is likely to be positive but constrained by low interest rates.

Since inception in 2008, Torus has developed a well-diversified specialist portfolio with business written in London, Bermuda, the United States and continental Europe. Expansion has been achieved through a combination of acquisitions and organic growth. In 2012, growth will be driven by Lloyd’s Syndicate 1301, which writes an established book of short-tail specialty lines business, including accident and health, property, specie, property schemes and bloodstock. Torus acquired the syndicate’s corporate members, Broadgate Underwriting Limited and Broadgate Underwriting 2010 Limited, in September 2011. In addition, significant growth is anticipated in the U.S. admitted and excess and surplus lines markets, in spite of strong competition from established local insurers. A.M. Best will continue to closely monitor the performance and reserve development of this U.S. business, particularly in view of the prevailing weak and competitive rating environment and the potential impact of the economic downturn on claims experience.