Described as a “market first”, specialist insurer Hiscox has teamed with RKH Reinsurance Brokers to launch a new variable consortium.
The consortium allows Hiscox to bind capacity on behalf of their follow market, while every consortium member can flex their line-up to a selected maximum on a risk-by-risk basis instead of being tied to a predetermined share of all business. It has a maximum line of over US$20 million and spans a host of general liability risks, including trucking, construction and wildfire.
According to the specialist insurer, the variable structure gives it true flexibility and the chance to respond to more challenging risks. It also gives brokers access to meaningful capacity from a single underwriting source.
The move represents the third of a suite of US liability consortia being led by Hiscox. It is open to large risks domiciled in the USA and has already bound US$1 million GWP.
“Realising that some of the larger risks in highly exposed industries have been struggling to find capacity, we have been pleased to collaborate with RKH Reinsurance Brokers to put a truly innovative market response in place,” said general liability underwriter at Hiscox London Market, Ed Wallis. “The variable consortium offers general liability brokers and their clients a valuable point of entry for London market capacity, and will bring risks into the Lloyd’s market that might otherwise struggle to find a home.
“Our consortium members have given us the mandate to consider a broad spectrum of risks in capacity-challenged areas of the liability market, on the basis that they need not be constrained by a predetermined share of the portfolio. This allows them to vary their line according to the risks we put in front of them, allowing us to aggregate a larger amount of capacity than we might otherwise be able to obtain through a traditional consortium structure when the right opportunities present themselves. Ultimately this means we can be of greater service to our clients when they need us most.”