Ex-Hiscox bosses create new insurance business at Lloyd’s with $800 million start-up finance

A group of ex-Hiscox chiefs have set up a new London insurance group at Lloyd’s with $800 millon of backing from international investors and hired City heavyweight Sir Howard Davies as chairman.

Inigo is being founded by Hiscox’s former chief underwriter Richard Watson, who stepped down from his former employer last year after 33 years. He is being flanked by Russell Merrett, former managing director of Hiscox’s London Market arm, and Stuart Bridges, former chief financial officer of Hiscox and Icap.

The launch is being seen as a coup for London as the team decided to set up here rather than overseas locations such as Bermuda who have been attracting billions of dollars of new capital. Watson said: “Inigo has chosen London as its principal base since it regards the overall insurance ecosystem offered by Lloyd’s as exceptionally attractive and believes it will best support the growth and development of the new syndicate.”

Sir Howard is currently chairman of NatWest and was chairman of the Financial Services Authority from 1997 to 2003. He has previous insurance experience at Phoenix Group, where he was chairman from 2012 to 2015. Inigo’s blue chip backers include Canadian pension giant Caisse de depot et placement du Quebec, Enstar, JC Flowers, Oak Hill Advisors, Qatar Investment Authority and Stone Point.

Management have also invested their own money in the new venture, which will sell both insurance and reinsurance. Subject to approval from Lloyd’s, they hope to start trading in 2021.

The team have signed a deal to buy Lloyd’s syndicate 1301 and its managing agency from the Enstar Group. None of the previous policies underwritten by the syndicate will transfer to Inigo.

Watson said: "This significant capital raising, together with our acquisition, gives us the platform we need to turn Inigo from a concept into reality.

“We believe 2021 will mark the beginning of an exciting growth phase for Lloyd’s and the London Insurance Market and Inigo will contribute to growing the specialty and reinsurance marketplace as it returns to profitability.”

In a fillip to Lloyd’s chief executive John Neal, the group said it was “fully supportive” of his measures to modernise the market and make it more efficient for insurers and their clients to use. Inigo is believed to be in the course of hiring a number of big name underwriting executives and will give more details on which particular types of business it will be specialising in when it has completed those hires.

Rates have hardened significantly in the 2021 year of account after being in the doldrums for years. Neal has said he expects Lloyd’s capacity to be around 13% higher next year as a result in what supporters of his reforms say is a sign international investors are being won over to the market again.

Concerns remain that Brexit will impact on the Lloyd’s market, although today’s Inigo news may go some way towards assuaging those fears.

Source: Evening Standard

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