Download - Q2 Analyst Seminar
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Q2 Analyst Seminar
Wednesday 28th May, 2014
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Introduction – Andrew Horton (Chief Executive Officer)
Beazley Operations – Ian Fantozzi (Chief Operating Officer)
Life, Accident & Health – Christian Tolle (Head of LAH)
Marine & Aviation - Clive Washbourn (Head of Marine)
Q&A
Agenda
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Beazley Operations
Ian FantozziChief Operating Officer
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• Supporting over 900 staff, across 25 offices globally
• Building a target operating model with 3 core platforms
Our operations
16,000 policies in 2013
550 users supported
Lloyd’s
Synergy IT system
Rest of WorldUS
• These platforms are underpinned by…
21,000 policies in 2013
350 users supported
BeazleyPro IT system
7,000 policies in 2013
90 users supported
Unirisx IT system
• Global shared services - IT, projects, data management, real estate, outsourcing,procurement, talent management, and underwriting support & claims support.
• Global technology solutions - Beazley Intelligence data analytics, group claims system,and group customer relationship management system.
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Name IanFantozzi
PennyMalik
BenSpencer
JamesWright
MuniraHirji
DouglasColosky
AdamCragg
Role ChiefOperatingOfficer
Head ofTalentManagement
Global Headof IT
US Head ofIT
Head ofCommercialManagement
US Head ofOperations
UK/RoWHead ofOperations
Beazley yearsservice
10 10 9 10 6 8 7
• The importance of talent development goes beyond our trading teams
Experienced operations team
5
• Our experience helps us to maximise value from investment
• Since 2009 we have we successfully delivered more large projects each year
• Over the same period we have been able to keep our project budget flat
0
5
10
15
20
2009 2010 2011 2012 2013
Large projects delivered (typically $250k+)
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• Focusing on maximising operational scalability
• Getting our products to market as efficiently as possible
• Applying consistent, high operational standards across all teams & locations
Supporting profitable growth
Offshoring/Outsourcing
• Gaining economies of scale through our target operating model
CentralisingStandardising
Removing duplication
Consolidating to 3 platforms
Applying our skills effectively
Sharing support resources
Making best use of locations
Outsourcing for scale
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Enabling product and service innovation
• Supporting product innovation
• Fostering product innovation – using our ‘B-Hive’
• Reducing product launch time – dedicated product support
• Leading on service innovation
• Developing technology to support the broker back-office
• Increasing use of online rating & policy fulfilment solutions
European e-trading platform
• Investing in technology and services where we see growth opportunity
• Implementing functionality to support US packaged products and US programmes
• Building out breach response servicing infrastructure
• Leveraging our new ‘thin client’ infrastructure
• Rolling out business applications on mobile devices
• Facilitating broker relations through mobile access to CRM system
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• Well advanced in building a cost effective and scalable infrastructure
• Experienced operations team that has been able to continuously improveour support and project delivery capability
• Enabling our underwriters to grow the business efficiently through productand service innovation is our priority
Operations summary
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Life, Accident & Health
Christian TolleHead of LAH
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Class 2013($m)
Australian IncomeProtection
31
PA Reinsurance 22
PA Direct 19
Life Direct 14
Life Reinsurance 3
Sports 2
US A&H PA 1
Total 92
Product composition of the LAH account – 2013 year of account
AIP34%
PAReinsurance
24%
PA Direct21%
Life Direct15%
LifeReinsurance
3%
Sports2%
BICI A&H PA1%
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Classes of business – core products
Personal Accident
• Insurance
• Reinsurance
• Income protection
Life
• Insurance
• Reinsurance
Sports
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Classes of business – geographic expansion - Australia
• Australian Income Protection
Market suffering adverse loss ratios
Some carriers exiting the market
Renewing with rate corrections
Opportunities for specialists
• Personal Accident
Coverholder business
Expanding into brokered open marketbusiness
Building a larger more diversified book
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Classes of business – geographic expansion – US gap medical
$0
$1,000
$2,000
$3,000
$4,000
$5,000
1965
1969
1973
1977
1981
1985
1989
1993
1997
2001
2005
2009
2013
2017
2021
US Healthcare Expenditures $B
• US healthcare costs continue torise several times faster than GDP
• These costs are outstrippingpeople’s insurance cover
• Our admitted gap protection products provide employers with flexible andcost-effective options, while helping employees offset expenses orreplace lost income
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LAH summary
• A specialist niche that diversifies well
• Beazley has successfully entered this market – albeit at a cost
• My aims as team leader are:
o Build US business
o Rebalance the Australian portfolio
o Deliver Beazley target returns
14
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Marine OverviewClive Washbourn
Head of Marine
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Energy37%
Hull22%
Cargo13%
MarineLiabilities
10%
War andK&R10%
Aviation8%
Class 2013($m)
Energy 111
Hull 66
Cargo 40
Marine Liabilities 29
War & K&R 28
Aviation 24
Total 298
Composition of the Marine account – 2013 year of account
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Classes of business – core product set
Cargo
• Cargo & Specie
• Project Cargo
• Fine Art
Hull & War
• Builders’ Risks
• Hull & Machinery
• Increased Value
• Mortgagees’ Interest
• Voyage & Tow
• Hull & Aviation War
• Kidnap & Ransom (Marine)
Energy
• Upstream
• Midstream
• Downstream
• Utilities
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Classes of business – areas of growth
Aviation
• Airlines – Hull & Liability
• General Aviation – Hull & Liability
• Rotor Wing
Satellite
• Launch
• In-orbit
Liability
• Transport & Logistics Liability
• Ports & Terminals Liability
o Property & Equipment
o Business Interruption
• Marine Professional Indemnity
• Offshore Professional Indemnity
• Protection & Indemnity
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Marine performance 2003 to date
$m
19
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Marine summary
• Beazley Marine has continued to grow since our last presentation in 2012
• Continuing our highly segmented underwriting
• Delivering outstanding returns on equity
• A team able to navigate through choppy waters… and ready to open the sailswhen the wind changes
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• Good performance in 2012, on track against our budgets
• The external environment is relatively unchanged
• We aim to grow in 2013 in line with our vision with an emphasis on higher margin,short tail classes
In summary
21
Any questions?