News review: December

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A brief round-up of December's news.

The deadline for the second round of bids for Quinn Insurance passed on the 8 December with the Anglo Irish Bank still in the running. Reports in the Irish press suggested that a sale to a trade buyer was more likely amid uncertainty over the future of the state-owned bank. The bank reportedly submitted a joint bid with Liberty Mutual while Travelers, Zurich and Allianz were also thought to have an interest.

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Barbon Insurance Group's managing director Nick Sharp claimed its next acquisition target would dwarf the group's earlier purchases. Mr Sharp said: "I expect our next acquisition will happen towards the end of 2011. While it might not be transformational, it could be of a company with 100 people and premium of £40m to £50m. Given we are a £150m company, that is quite considerable for us."

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Brokers raised concerns that insurers' willingness to pay claims had deteriorated in the past two years, with South-west broker Higos considering blacklisting insurers that undermined its integrity with clients by not paying claims. Ian Gosden, managing director at Higos, claimed there was a trend in the industry of insurers trying to get out of paying claims. "If a claim goes wrong it always looks like the broker's fault, but it is no good telling a client it is the insurance company's fault because we place risks with that insurer," he said.

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Outgoing Brit Insurance UK chief executive Peter Burrows stepped down as a director of online small to medium-sized enterprise broker Xbridge. Mr Burrows has been replaced on the Xbridge board by Brit director of market management and regional operations, Simon Cooter. Brit invested £7m in Xbridge in 2008, acquiring a 38% stake in the firm.

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Aviva geared up to roll out its direct pricing model to all of its personal lines broking partners during 2011. General insurance chief executive David McMillan said the insurer had successfully brought the direct pricing model to the majority of its brokers due to high demand. "We have taken the pricing to 80% already and intend to take it to the rest next year. There has been more sophisticated pricing in the direct personal lines market for years and brokers have long said they want this too," he stated.

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Oval chief executive Phillip Hodson outlined his view that there is a North-South divide in the performance of mid-tier commercial brokers and that these economic factors would be considered when making acquisitions. John Harrison, sales and marketing director at CCV, agreed there was a divide between the North and South, but only in terms of the perceived value of firms. He continued: "People in the South have this kind of resilience; the companies we approach think they're worth more."

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Insurer QBE cited a shift in the market as the reason behind the reshuffle that led to property managing director Bernard Mageean's departure from the firm. Mr Mageean joined QBE from RSA, where he was commercial underwriting director, in 2008 but left the firm after the property, casualty and motor underwriting teams were merged into one division. The new team will be led by former casualty and motor MD Ash Bathia, who was named chief underwriting officer for the division.

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A-Plan Holdings insisted it would continue to invest in opening new branches when suitable opportunities arose. The announcement came as it reported a pre-tax profit of £16.98m (2009: £16.86m) for the 12 months ended 28 February 2010 and a 3% jump in operating profit to £16.79m (2009: £16.34m). In its director's report, the company secretary, Andrew Galbraith, said: "Despite the market challenges, the company successfully opened two new branches in the year, with several more in the pipeline."

Bluefin Insurance Services claimed the restructure of its operations was designed to help it develop a national strategy rather than facilitate branch closures. In late November the firm told staff of its plans to segment the business into four separate divisions: Bluefin Corporate, Bluefin Commercial, Bluefin Private Clients and Bluefin Broker Partnership Services. Graham Coates, chief trading officer, said the time had come to bring more clarity to its offering.

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Towergate-owned underwriter Fusion unveiled its plans for a move into directors' and officers' (D&O) and engineering insurance sectors in 2011. The firm, which currently offers commercial business, casualty, marine and large corporate business, will roll out its new products in January. Both D&O and engineering will become part of the underwriters' combined commercial product, with the capacity provided by RSA. The products will continue to be distributed by Fusion's current panel of brokers.

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The British Insurance Brokers' Association (Biba) revealed that regulation would be at the top of its agenda in 2011, as it prepared its annual manifesto. Graeme Trudgill, Biba's technical and corporate affairs executive, said there were three campaigning issues in the manifesto for 2011: helping customers; regulation and consumer protection; and driving change in the insurance industry. He said: "Regulation is the absolute central tenet of Biba's manifesto for 2011."

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