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A partnership that makes sense

28 September 2015Drew Schnehage, AUM & Stef Theofanidis, Hollard

Building capacity in order to make a significant impact on the industry is the hallmark of a company that has set its ambitions to become a dominant force in the industry. This is done by building a client base that is testament to the products and services they offer to the industry as well as a skills base to achieve this.

Seeing the potential for significant growth in the industry, Aquarius Underwriting Managers (AUM) has recently made the decision to form an alliance with Hollard with a vision towards a possible future merger.

A step in the right direction

AUM made the decision to move away from Zurich in order to align itself with Hollard, and while many thought that the move came at an interesting time – considering the dynamics of the industry’s operating environment – AUM CEO Drew Schnehage says that the relationship makes perfect sense.

“We recently decided to move our portfolio from Zurich to Hollard. This was a strategic decision for AUM to align itself with a business partner that is able to support the specific requirements of a niche personal lines underwriting manager (UMA), both as our insurer principal and in time, a shareholder. We have gained great value and support from our partnership by leveraging Hollard's business acumen, reinsurance capacity and protections, procurement advantage and implementing actuarial analyses to further refine our pricing,” Schnehage says.

This is a big move for the company considering the implications that it has further down the line if AUM is aiming to make Hollard a shareholder of the company. Such a move brings about a shift in mindset as well as a shift in the way that the company does business.

“The binder regulations have had a profound impact on the UMA business model and we believe Hollard is the right partner-fit to ensure that we continue to thrive under these different and difficult operating conditions. We foresee that there will be further consolidation, with mergers and takeovers a frequent reality in 2014,” says Schnehage.

A mutually beneficial relationship

The partnership does not only have the potential to benefit AUM, but it also has the potential to add significant value to Hollard. Managing Director of Hollard Insurance Partners, Stef Theofanidis, points out that it is important for a company like Hollard to partner with the right UMA in order to grow the business.

“We really do back our UMAs in a big way through our procurement, legal and compliance, and continuous improvement strategies to name but a few. However, we always try to create a balance between supporting the business and allowing it to function autonomously and thrive through its own knowledge and expertise,” says Theofanidis.

Hollard also offers extensive backing to its UMAs. “In order to translate these services into reality, we provide the UMA with a dedicated Investment Principal, a Hollardite who lives, eats, and breathes the partner business. Over the years, this has proven to be a successful model in that it allows for the Hollard offering to be accessed through one point of entry. We are also involved at a strategic level, often through a board position.”

Becoming a part of the Hollard family

Brand association and brand awareness are two key ingredients to the success of a company in a highly competitive industry. Being associated with the right brand will potentially be very rewarding for a company.

Hollard has recently launched its new corporate identity and Schnehage says that the new image offers a lot of advantages to AUM.

“The new Hollard brand is testimony to the innovative and inspiring company we now call our partner. We look forward to having this rub-off on the AUM brand to make our offering even more unique.”

 

Quick Polls

QUESTION

The FSB is thinking of scrapping Level II Regulatory Exam (which would have tested product knowledge) in favour of an approach that forces insurers to train staff and monitor their actions. Do you agree with this approach?

ANSWER

Yes. The Level II Regulatory Exams were a massive headache for those who had to write them
No. At least with the exams you knew who were the top achievers. A lot of trust now needs to be given to insurers.
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