Allianz restructures ART, creates Capital Solutions business for ILS

Allianz Global Corporate & Specialty (AGCS), a division of global insurance and reinsurance firm Allianz, has announced that its Alternative Risk Transfer (ART) unit is reshaping. The move sees the Insurance-Linked Markets team transition to a standalone business line, called Capital Solutions.

Effective November 1st 2018, the Capital Solutions line of business will be led by Richard Boyd, currently ART Chief Underwriting Officer (CUO).

The remaining ART practice groups, which offer corporate solutions, reinsurance, and climate solutions, will continue to operate under its current name of Alternative Risk Transfer, and will be led by current AGCS Global Head of Liability, Michael Hohmann.

The ART unit has become a major line of business for AGCS, contributing €1.135 billion of gross written premiums (GWP) in 2017, and the firm says that the reshaping of its ART unit reflects the increasing importance of utilising non-traditional insurance solutions for global businesses.

The unit works closely with ILS funds, including Nephila Capital, for who ART has been a regular partner on large transactions featuring catastrophe and weather risks, while also providing fronting for Nephila and other collateralized sources of reinsurance capital.

Hartmut Mai, AGCS Board Member and CUO Corporate, commented: “Large companies are increasingly seeking to assume more control over their risk management beyond traditional insurance products in property or liability. With our two new lines of business, we can respond to these needs by designing multi-line, multi-year, parametric or capital-market solutions to protect our clients from earnings and cash flow risks.

“Our new structure and leadership team will help AGCS to further evolve and grow this important segment of our business.”

As larger, global businesses demand more than just a product-based response, AGCS notes that the “tailor-made approach” of the new ART structure combines AGCS and ART products and services within a bespoke solution, enabling the firm to respond to growing demand for customised solutions that respond to complex risks.

It’s also been announced that Ciara Brady is joining AGCS from Swiss Re to replace Michael Hohmann as Global Head of Liability, effective January 1st 2019. Brady joined Swiss Re in 2005 in Toronto, and currently serves as Head of Casualty Treaty Global and International.

In the interim between November 1st and January 1st, Alfred Henneboehl, Deputy Global Head of Liability, AGCS, assumes responsibility for Liability, and will work closely with the global liability leadership team. At the same time, Paul Schiavone, current Global Head of ART, will shift his focus to his existing regional responsibility as North America Head of Long Tail Corporate Lines.

Mai, commented: “I am delighted to welcome Ciara to AGCS. She will build on the outstanding business that Michael Hohmann has already established over his nine-year tenure as our Global Head of Liability as he now turns his skills to continuing the successful expansion of our solutions and services beyond traditional commercial insurance.”

Global insurer and reinsurer Allianz has established an important franchise specialising in alternative solutions, which includes fronting for insurance-linked securities (ILS) or alternative capacity and tailored risk transfer product. By leveraging the synergies between its corporate division and the reshaped ART business, Allianz has positioned itself well to meet growing insurer and investor demand for bespoke, non-traditional solutions.