Torus strikes deal to expand into Lloyd’s market
Bermuda-based Torus Insurance Holdings Ltd is set to buy its way into the Lloyd’s of London market after agreeing to purchase Broadgate, which underwrites through syndicate 1301, from Clal Insurance Enterprise Holdings.
Torus will retain Broadgate’s current team of underwriters, claims handlers and syndicate management under the direction of active underwriter Bob Katzaros, the company said in a statement yesterday.
Subject to approval by Lloyd’s, the acquisition will enable Torus to write specialty business in Lloyd’s from the start of next year.
Access to Lloyd’s is a significant milestone for Torus, which set up in Bermuda in
“We have said since the company was formed that we intended to build a global specialty insurer with a niche play in reinsurance,” Clive Tobin, group chief executive of Torus, told
The Royal Gazette yesterday.
“This is the last piece in the puzzle and it’s something we’ve been working on for some time.”
Broadgate specialises in a range of niche short tail business across several product lines, including accident and health, property direct and facultative, property treaty, specie, property schemes and bloodstock. Broadgate started underwriting in 2000 and has a capacity of £92 million ($144 million).
The acquisition will allow Torus to expand its specialty offerings and access developing markets, particularly in Asia and Latin America.
Torus was launched in Bermuda in June 2008 with $720 million in capital from First Reserve Corporation, a private-equity firm specialising in energy investments. Mr Tobin, the former head of XL Group’s insurance operations, took over as Torus CEO in January 2009.
The group has grown its platform as a global specialty insurer with more than 500 employees in 13 offices, with European, US and Bermuda-based operating companies, as well as a back-office services operation in India with 150 staff.
Despite the tough economy since Torus started up, its development is pretty much on track, Mr Tobin said.
“We said we wanted to build the platform partly through organic growth and partly through acquisitions and we’ve done that,” the CEO said. Last year the company expanded its reach into Europe, through the acquisition of Glacier Insurance, which has become Torus Europe, and TIS Indemnity, now Torus National, which gave the group access to the US admitted market.
“All in all, I’m pretty happy with where we are,” Mr Tobin said. “It’s been a difficult time for the industry and there have a lot of catastrophes over the past 18 months. But we’ve been very pleased with the opportunities that have come our way.”
Mr Tobin said rates had risen in areas directly affected by natural disasters, such as New Zealand and Japan. Generally, rate increases of eight to ten percent had been seen generally for July 1 treaty renewals, he added.
“We are also seeing increases in the energy sector, offshore and onshore, property and liability,” Mr Tobin said.
Torus has slimmed down its Bermuda operation in recent months, announcing the closure of its excess liability operation in March this year, followed by an agreement last month to sell renewal rights to its property catastrophe reinsurance book to Bermuda rival Montpelier Re. Torus still has a small team on the Island writing casualty and specialty reinsurance.
Mr Tobin said the Montpelier transaction reflected Torus’s desire to move capital into less volatile lines of business.
“We will continue to be in Bermuda in specialty reinsurance and we want to continue to expand that business,” the CEO added.