AXA XL: Everything you need to know
- Headquarters: Stamford, Connecticut
- GWP: $21.7 billion (according to 2020 annual report)
- Employees: 9,000+
- Global locations: 60+
- Underwriting expertise: aquaculture, equine, and livestock, architects and engineers, aviation and aerospace, construction, consumer goods and services, entertainment and leisure, financial services, healthcare and life sciences, technology, transportation, captives, casualty, construction, cyber, environmental, excess and surplus, global programs, professional liability, property, specialty
- Key people: CEO Scott Gunter
AXA XL is the property and casualty, and specialty risk division of AXA, a multinational insurance and asset management company based in France. AXA XL Insurance provides more than 30 lines of business that include property, casualty, construction, cyber, financial lines, accident and health, professional liability, and environmental. The company also has a toe in the specialty insurance space, including expertise in aerospace, motor, political risk-credit and bond, fine art and specie, marine, and crisis management.
A market-moving acquisition
In March 2018, it was revealed that Paris-headquartered AXA agreed to pay US$15.3 billion in cash to own 100% of Bermuda-based XL Group, a global P&C commercial lines insurer and reinsurer with a presence in North America, Lloyd’s, Europe, and Asia-Pacific.
At the time of the announcement, AXA chief executive Thomas Buberl cited XL Group’s geographical footprint, world class teams with recognised expertise, and innovative client solutions, noting, “This transaction is a unique strategic opportunity for AXA to shift its business profile from predominantly L&S business to predominantly P&C business, and will enable the group to become the number one global P&C commercial lines insurer based on gross written premiums.”
The acquisition was completed in September 2018, after which the company continued operating under the master brand AXA, while forming a new division dedicated to large P&C commercial lines and specialty risks known as AXA XL that is made up of XL Group operations, AXA corporate solutions, and AXA art. The division’s offerings are meanwhile categorised under three main lines – XL insurance, XL reinsurance, and XL risk consulting.
AXA XL’s insurance companies are spread out across the globe. They consist of:
- Brooklyn, based in Australia
- Greenwich Insurance Company, based in the US
- Indian Harbor Insurance Company, based in the US
- XL Insurance America, Inc.
- XL Bermuda Ltd
- XL Insurance Company SE, based in the EU
- XL Insurance Company of New York, Inc.
- XL Insurance (China) Company Limited
- XL Insurance México SA De CV
- XL Insurance Switzerland
- XL London Market Ltd.
- XL Select Insurance Company, based in the US
- XL Specialty Insurance Company, based in the US
- Catlin Underwriting Agencies Limited (CUAL), a managing agent at Lloyd's
- Catlin Indemnity Company, based in the US
- XL Catlin Insurance Company UK Ltd.
- Catlin Insurance Company Inc., based in the US
- Catlin Specialty Insurance Company Inc., based in the US
- T.H.E. Insurance Company, based in the US
- Angel Risk Management Ltd., based in the US
- XL Insurance Guernsey Limited
- XL Catlin Services SE, a Financial Conduct Authority (FCA) regulated and authorised intermediary
Innovation and investment
A limited partner of AXA XL, XL Innovate is a global insurtech venture capital firm that invests in entrepreneurs contributing to the P&C sector, and typically focuses on start-ups created in-house, disruptive new insurance models, and data and analytics companies with high-value insurance applications.
With funding continuing to flow into insurtechs, interest in this space is definitely not a fad that’s going away. For future investments, the XL Innovate team is looking for businesses that are taking a bite of the commercial insurance process and addressing a problem in that area, Martha Notaras, partner at XL Innovate, told Insurance Business.
“One of the defences has always been that commercial lines are so complex that insurtech won’t make progress into that, but we’re seeing that actually there are data and analytics that drive the commercial lines and also that there are certain operational efficiencies that you can drive into,” she explained. “When you tell me that a problem is complex, my first question is, I understand that the problem is complex, but which portions of that problem are not complex because I think that there are point solutions that can come in and move out from there.”
One of XL Innovate’s investments has been into on-demand insurance cloud provider Slice Labs, which is a partnership that recently resulted in a new offering. In October 2018, AXA XL and Slice launched a new cyber policy designed specifically for small and medium-sized businesses. The AXA XL insurance product is powered by Slice’s Insurance Cloud Services platform, and provides small and midsized businesses in the US with comprehensive cyber insurance coverage and real-time intelligence to proactively fight against cyber risks.
“Businesses of every size are vulnerable to cyber risk,” said John Coletti, chief underwriting officer of AXA XL’s North America cyber and technology insurance business. “In providing this on-demand, AI-powered cyber insurance product, we are expanding our reach in the cyber insurance market and levelling the playing field for SMBs, giving them access to broad cyber insurance protection that the largest of companies rely on as well as cybersecurity resources to help them protect their revenue, profitability and customer relationships.”
Another group at AXA XL that is focused on bringing innovation to the insurance industry is Accelerate, which drives commercial opportunities for the group by finding disruptive business models and implementing them via new products and propositions. One technology the team is keeping its eye on is artificial intelligence.
“A lot of the companies we’re working with, we look for quite a strong AI component to what they’re doing. The digital experience in particular around distribution is really important, but we’re looking for also how they use AI to enrich those insights,” said Vincent Branch, chief executive of Accelerate, highlighting a partnership between AXA XL and Cytora, a start-up that employs AI and open source data to improve the capabilities of insurers to quantify, select and price risk.
In terms of the approach to collaboration between insurtechs and insurance companies, Branch pointed out, “There’s been a really positive wakening up to the opportunities it creates, [and] I think now everyone’s talking about partnerships, everyone’s talking about how we can help drive the industry forward.”