Fidelis adds London operation to hybrid re/insurance platform

Fidelis Insurance Holdings, the hybrid underwriting and investment-oriented insurance and reinsurance firm launched by Richard Brindle and Neil McConachie has added a London underwriting operation to its platform, as it starts to acquire greater scale.

Fidelis operates with a hybrid approach, aiming to allow flexibility in terms of capital deployment into underwriting opportunities or its investment strategy, so allocating capital to the side of the business which has the most promise at any one time.

The hybrid investment strategy, which will see Fidelis allocating capital to a range of investment of hedge fund managers, is designed to be a return driver for the re/insurer when it needs it and the underwriting alone is not driving performance.

The new London operation has been approved by the UK Prudential Regulatory Authority and will begin underwriting with immediate effect.

It will be led by Dan Burrows as UK Chief Executive Officer, with Nick Burkinshaw, Chairman of Specialty and Richard Coulson, Specialty Lines Underwriter. Additional underwriting hires are expected to be announced in 2016.

The London operation, Fidelis Underwriting Limited, has received a financial strength rating of A- (Excellent) and an issuer credit rating of “a-” from A.M. Best.

Fidelis said that the UK business will focus on specialty insurance lines such as political risk, war, terrorism & political violence, space, specialist marine and energy products. The firm said that this will complement the reinsurance operations in Bermuda, headed by Ben Savill.

Richard Brindle, Group Chief Executive Officer of Fidelis Insurance, commented; “I am delighted to announce the launch of our London underwriting platform which represents a vital component of our strategy. Strong mutually beneficial relationships are essential to our continued success and ensuring that we are available and accessible to our broking partners and clients in leading markets is key to maintaining and developing these relationships.

“A London based business gives us the platform to build out our specialist insurance business and under Dan’s leadership I am certain that we will rapidly establish ourselves as a new force within the London market.”

In rating the London operations A.M. Best noted that “competitive market conditions and excess capacity in the (re)insurance marketplace that may challenge the execution of the business plan” for Fidelis.

However, the whole point of the Fidelis hybrid underwriting and investing strategy is to counter exactly that, allowing the firm to focus on insurance and reinsurance underwriting when the market is attractive to do so, but put more assets into its investments when re/insurance market conditions are not conducive to deploy as much capacity.

It is this flexibility which Fidelis hopes will enable it to ride out the reinsurance cycle more effectively than its competitors and maximise return on equity, no matter which side of its business is suffering from a soft market.

By actively managing both sides of the balance-sheet Fidelis hopes to outperform. Having now added a London specialty insurance operation the firm has greater flexibility and reach in sourcing business as well, which provides another lever to navigate the cycle.