Best’s Review’s Online Archives Three Decades of Challenge Hurricane Andrew struck Florida in August 1992 but its impact on the global reinsurance market has been long-lasting. Page 34 AM BEST’S MONTHLY INSURANCE MAGAZINE August 2022 • Volume 123 • Issue 8www.bestreview.com ISSUES & ANSWERS: Captives and Domicile Solutions Starting on Page 19 Life Settlements: The ‘Ferrari in the Garage’ Page 30 Best’s Rankings: Top Latin America Insurers Page 46 Best’s Rankings: Top US Cyber Insurers Page 48Driving Change1BEST’S REVIEW • AUGUST 2022 From the Editor’s Desk Hurricane Andrew 30 Years Later: A Tale of Challenges and Success for Florida, Bermuda Best’s Review examines the impact of Hurricane Andrew on its 30th anniversary. The issue also includes coverage of life insurance settlements and rankings of the largest U.S. cyber and largest Latin America insurers. How should commercial coverage change to better protect today’s commercial customers? Email your answer to bestreviewcomment@ambest.com or scan the QR code to submit your response. Responses will be published in What Readers Say in a future issue. The Question: For the insurance industry, it was a storm to remember. Hurricane Andrew made landfall near Homestead, Florida, on Aug. 24, 1992. With maximum sustained winds of 165 mph at landfall, the storm flattened homes and caused insured losses of more than $30 billion in 2021 dollars. Today, 30 years later, it still ranks as one of the most costly storms to hit the United States. The storm forced some insurers out of business. It also marked a turning point in the use of technology to model catastrophes and estimate losses. And Bermuda, known mainly as a domicile for captives, began to emerge as a center for reinsurance. August is Reinsurance Awareness Month. In “30 Years After Hurricane Andrew, Bermuda Reinsurers, Florida ‘Joined at the Hip,’”Best’s Review speaks with industry experts about the changes that came about in the storm’s aftermath. Hurricane Andrew is one of only a few hurricanes that have made landfall as a Category 5 storm, with winds of 157 mph or higher on the Saffir-Simpson Hurricane Wind Scale. Researchers are preparing for more storms with winds in excess of 200 mph. In “FIU Extreme Events Director: Prototype Facility Will Test Forces of a ‘Category 6’ Hurricane,” Best’s Review speaks with Richard Olson, the director of the Extreme Events Institute at Florida International University about FIU’s efforts to design and prototype a facility to test winds of 200 mph, waves and storm surge. Reinsurers are very familiar with losses from hurricanes and some have begun to adjust their business to reduce volatility from catastrophes. Reinsurers will have an opportunity to discuss their concerns next month at Rendez-Vous de Septembre in Monte Carlo, Monaco. AM Best is scheduled to hold a reinsurance market briefing at the conference. The Vermont Captive Insurance Association’s annual conference, meanwhile, takes place this month in Burlington, Vermont. AM Best TV will be there to cover the event. AM Best’s Dan Ryan and Dan Teclaw are scheduled to participate. In “Protected Cell Structures Fuel Captive Growth,” Best’s Review examines the latest developments in the captive market. The life insurance feature this month focuses on life settlements. In “Startup Founder Hopes to Help People Find ‘Ferrari in the Garage’ by Taking Life Settlements Mainstream,” Best’s Review speaks with Lucas Siegel, the founder and chief executive officer of Harbor Life Settlements. The August issue also includes Best’s Rankings of the largest U.S. cyber insurers, the largest Latin America insurers, and the largest U.S. property/ casualty insurers ranked by direct premiums written by line. BR Patricia Vowinkel Executive Editor patricia.vowinkel@ambest.com2BEST’S REVIEW • AUGUST 2022 CONTENTS CATASTROPHES Pages 34-43 Best’s Review looks at the continuing impact of Hurricane Andrew on the reinsurance market and how researchers will be studying the effects of a possible Category 6 hurricane. Page 34 30 Years After Hurricane Andrew, Bermuda Reinsurers, Florida ‘Joined at the Hip’ Hurricane Andrew made landfall in Florida in 1992, changing the face of the global reinsurance market just as it was beginning to emerge. Page 40 FIU Extreme Events Director: Prototype Facility Will Test Forces of a ‘Category 6’ Hurricane Hurricanes are becoming more powerful and destructive. One of the goals of the facility is to anticipate and learn from what a Category 6 hurricane would bring. The damage and destruction from a 185 mph sustained event hitting a highly developed U.S. coastline would be unprecedented. ISSUES & ANSWERS Page 19 Captives and Domicile Solutions Industry experts discuss how to choose a captive manager and the role of actuaries in captive management. CAPTIVES Page 24 Protected Cell Structures Fuel Captive Growth A hardening insurance market is among the factors resulting in more captives, nearly 20% of which are protected cells. LIFE INSURANCE Page 30 Startup Founder Hopes to Help People Find `Ferrari in the Garage’ by Taking Life Settlements Mainstream Lucas Siegel, the founder and chief executive officer of Harbor Life Settlements, wants to make the life settlements industry resemble how homes are sold and bought online. By doing that, he’s hoping his company and the larger industry will grow by making the process more transparent and navigable for consumers.4BEST’S REVIEW • AUGUST 2022 CONTENTS (continued ) COLUMNS 14 At Large 16 Risk Adviser DEPARTMENTS 1 From the Editor’s Desk 4 Advertisers Index 6 Best’s Calendar 7 Executive Changes 10 Web Traffic 12 Masthead: Forestay 13 In the News 55 What AM Best Says 59 Underwriting & Loss Control 61 Book Store 62 App Store 63 Trending: Best’s News 64 Trending: Best’s Research 65 AM Best Webinars 66 AM Best TV & Audio 67 Best’s Credit Rating Actions 74 Corporate Changes 75 Preferred Publisher Program 76 Industry Updates 79 Masthead: Backstay 80 The Last Word ADVERTISERS IFC SCOR Global Life 3 Omaha National 5 Florida State University 11 AM Best 18 The AM Best Business Trilogy 20 Pinnacle Actuarial Resources 22 Lexington Insurance 29 Best’s Credit Reports & Best’s Financial Reports 39 AM Best Insurance Solutions IBC Best’s Credit Ratings BC Applied Underwriters Notice: While AM Best confirms the accuracy of Best’s Ratings of insurers referenced in advertisements published in this magazine, these ratings are subject to change after publication. The current ratings of insurance companies are available free on the web at www.ambest. com/ratings. Further, we can’t warrant the Best’s Ratings claimed by brokers advertising coverages from unrated insurers. In addition, some of the insurance policies, products and services advertised may not be available, licensed or legal in all jurisdictions. Cover design by Angel Negrón. CYBER INSURANCE Page 47 AM Best: With Cyberattacks Becoming More Complex, US Cyber Market to Remain Hard Rate increases are driving a large part of the premium growth and are expected to continue to rise through 2022. LATIN AMERICA INSURERS Page 44 AM Best Retains Negative Outlook on Peru’s Insurance Industry According to Best’s Market Segment Report: Market Segment Outlook: Peru Insurance, overall, economic conditions continue to recover from the pandemic, due to the country’s macro-stability. However, many of the actions taken to enhance economic recovery have aroused political interest, creating challenges for the current and future performance of the insurance market. BEST’S RANKINGS Page 46 Largest Latin America Insurers – 2022 Edition Ranked by 2020 gross premiums written. Page 48 US Cyber Insurance – Top 20 Insurers – 2022 Edition Ranked by 2021 total standalone and packaged cybersecurity direct premiums written. Page 51 U.S. Property/Casualty – 2021 Direct Premiums Written by Line – 2022 Edition Page 52 U.S. Commercial Multi Peril – 2021 Direct Premiums Written – 2022 Edition Page 52 U.S. Homeowners Multiple Peril – 2021 Direct Premiums Written – 2022 Edition Page 53 U.S. Medical Professional Liability – 2021 Direct Premiums Written – 2022 Edition Page 53 U.S. Total Auto – 2021 Direct Premiums Written – 2022 Edition Page 54 U.S. Workers’ Compensation – 2021 Direct Premiums Written – 2022 Edition Visit news.ambest.com for a full listing of Best’s Rankings.6BEST’S REVIEW • AUGUST 2022 Best’s Calendar AM Best to Speak at Captive Insurance Conference Aug. 3-5: SOA/LIMRA Supplemental Health, DI & LTC Conference, Society of Actuaries and LIMRA, Washington, DC, USA. Aug. 7-9: APCIA Emerging Leaders Conference, American Property Casualty Insurance Association, Denver, CO, USA. Aug. 8: ICCIE Anniversary Celebration, International Center for Captive Insurance Education, Burlington, VT, USA. Aug. 8-11: VCIA 2022 Conference, Vermont Captive Insurance Association, Burlington, VT, USA. Aug. 9-13: NAIC Summer Meeting, National Association of Insurance Commissioners, Portland, OR, USA. Aug. 28-31: Insurance Tech Summit Latin America, Executive Business Meetings, Miami, FL, USA. Sept. 9: Insurance Market Briefing – Canada, AM Best, Toronto, Ontario, Canada. Sept. 10-14: Rendez-Vous de Septembre, Monte Carlo, Monaco. All events subject to change as organizations monitor developments regarding COVID-19. For a full list of conferences and cancellations, visit www.bestreview.com/calendar. Attending Exhibiting Speaking Hosting Sponsoring Video August Is Reinsurance Awareness Month Thirty years ago, in August 1992, Hurricane Andrew made landfall in Florida, fundamentally changing the face of the global reinsurance market. Coverage begins on page 34. 22.MK071H VCIA 2022 Annual Conference When: August 8-11, 2022 Ň Where: Burlington, Vermont Dan Ryan, senior director, will participate in a session titled, “Captive Solutions for ESG Headwinds,” on August 9 at 2:00 p.m. ET. Dan Teclaw, associate director, will speak in a session titled, “Innovative Strategies – Key to Insurance Success,” on August 10 at 8:45 a.m. ET. AM Best Rating Services is a Platinum Sponsor of the event and will exhibit at booth 32. Note that event details are subject to change. CONNECT WITH US TO GET THE BEST INDUSTRY PERSPECTIVE Our Insight, Your Advantage ™ www.ambest.com (908) 439-22007BEST’S REVIEW • AUGUST 2022 Executive Changes Liberty Mutual Insurance named Timothy M. Sweeney to succeed David H. Long as chief executive officer in January 2023. Sweeney also becomes a member of the board of directors effective immediately. Long has been at Liberty Mutual for 37 years, becoming president in 2010, CEO in 2011 and chairman in 2013. Under his leadership as CEO, Liberty Mutual has grown to the sixth-largest global property/casualty insurer and has been recognized with numerous awards for its philanthropic, workplace culture, and diversity, equity and inclusion efforts, Liberty Mutual said in a statement. “Liberty Mutual has been a part of my life for nearly four decades. The company has experienced significant change, challenges and transformation over the years, and I’m fortunate to have been a part of it all,” said Long in a statement. “Tim is an outstanding leader who will continue to drive the organization forward, harnessing the strength of our global organization.” Sweeney, who is based in Boston, will become the 10th CEO in Liberty Mutual’s 110-year history and has been at the company for nearly 30 years. He was appointed president in 2021, overseeing the organization’s three business units—global risk solutions, global retail markets and Liberty Mutual Investments. Sweeney previously served in a variety of senior leadership positions, including president, in GRM, the company’s global personal and small commercial insurance division, according to the company. Also effective in January 2023, Liberty Mutual named Damon Hart as secretary. This new role is in addition to his current role as executive vice president and chief legal officer. Mark Touhey, EVP, corporate secretary and chief of staff to the chief executive officer, will retire at the end of 2022, according to the company. In his additional role as secretary, Hart will be responsible for overseeing governance for the company’s board of directors. Hart, who has been part of the company’s executive leadership team since 2021, will report to Sweeney, the company said. Hart joined Liberty Mutual in 2014 and was promoted to deputy chief legal officer in 2020 before his current appointment. Prior to this, he served as senior vice president and deputy general counsel for litigation and coverage, overseeing the interests of Liberty Mutual and providing enterprise-wide coverage advice and opinions. He also spent several years as deputy general counsel for Employment Legal, according to a company statement. Touhey has worked at Liberty Mutual for 28 years, serving in multiple senior leadership positions across the global risk solutions business unit, talent and enterprise services and corporate finance departments. He has served in his current role since 2016, overseeing the company’s board of directors engagement and corporate governance and community investments. He also has led the organization’s corporate strategy and research department, according to a company statement. —Staff Report Liberty Mutual to Welcome New Chief Executive Officer, Secretary in 2023 Axa XL names global chief underwriting officer and Scor appoints successor to retiring CEO of reinsurance. Prudential Plc Names Former Manulife Exec as Group Chief Executive Officer Prudential plc named Anil Wadhwani as group chief executive officer effective Feb. 25, 2023, subject to regulatory approval from the Hong Kong Insurance Authority. Mark FitzPatrick, interim group CEO, will continue to lead the business and will support Wadhwani in his transition. FitzPatrick succeeded Mike Wells, who retired in March after 26 years with the company. Wadhwani has more than 30 years of experience, predominantly in Asia, combining strategic vision and execution in some of the world’s biggest companies. Wadhwani also has significant and proven digital experience, having driven the modernization of technology platforms across 13 markets in Asia in his Timothy SweeneyDamon HartNext >