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Managing Director
Aon Benfield Fac, APAC/Africa/Middle East
Singapore

Managing Director
Aon Benfield Fac, EMEA
Colombes, France

CEO
Aon Benfield Fac
London

Executive Vice President
Aon Benfield Fac, Americas
New York

Managing Director
Aon Benfield Fac, U.K.
London

Just the Facs: Aon Benfield's Global Growth

Facultative reinsurance can be a challenge. At its root is the ability of a team of brokers and analysts to fashion a particular, often unique solution to a specific problem rather than negotiate reinsurance coverage on a treaty or proportional basis. Some reinsurers also avoid facultative deals entirely because it is more costly to underwrite the facultative proposal, especially compared with an ongoing treaty relationship.

The key issue in the market this past year was the acquisition of Benfield, the former No. 4 reinsurance broker, by Aon Re, the largest broker.

Clearly, the merging of the two strong analytical operations benefits Aon Re's facultative abilities. The Aon Benfield team has a strong reputation in the facultative markets.

"My impression of Aon was that its strength rested with individual brokers while Benfield cultivate much more of a team-oriented approach," said one large reinsurer who declined to be identified. "I'd like to see whether the team or individual culture wins out, but that's not clear yet." He also cited the analytical skills and the portfolio analysis of the team.

"One plus one doesn't always equal two," said Adam Matteson, senior property underwriter with Munich Re. "However, as a reinsurer, I have seen no reduction in opportunities, service or commitment from the Aon Benfield team." He added that his impression was that Aon Benfield managed the internal situation well with "full transparency to the market."

Aon Benfield's facultative operation is truly global. It recently opened a new office in Dubai. In addition, the facultative unit created a captive for account placements for large corporate clients in Australia, South Africa, Hong Kong and Dubai.

Currently, Aon Benfield places more than $3 billion in annual premiums in the facultative markets worldwide.

CEO
Willis Fac
London

Executive Director
Willis Fac
London

Executive Director
Willis Fac
London

Executive Director
Willis Fac
London

Managing Director
Willis Fac
London

Surging No. 3 Reinsurance Broker Challenges Aon Benfield-Guy Carpenter Duopoly

Although Willis Re doesn't have the heft in its analytics department that an Aon Benfield or a Guy Carpenter can boast, reinsurers in the market said that Willis shows lots of hustle in this changing marketplace. The markets say Willis brings them the kinds of deals they want to do.

On the client side, Takashi Oka a manager with the large Asian insurer Tokio Marine, reports that Willis is its lead reinsurance broker and that the firm shows consistency and provides quality services.

Critical to any facultative relationship is the ability of the broker to bring excellent problem solving skills along with creativity and innovation.

"We ran a project creating a facility to combine many facultative cessions with the aim to reduce our administrative burden and improve our profitability," said Oka.

At the same time, he wanted the markets to see that the facility was a good package for them as well as Tokio Marine. As part of the development of the package, Willis used a portfolio modeling tool to design and deliver what its client sought. The project was a success.

Willis never submits a proposal nor offers advice and suggestions "that they will not be able to deliver," adds Oka. "They are very trustworthy experts."

The Willis facultative reinsurance team, which was formed in 2003, has grown to 41 from three just five years ago. Last year, it boasted as many as 20 clients, up from two six years ago. Willis Re's facultative team handles both property and casualty assignments. This year, Willis Re realigned four North American offices to become part of the facultative operation.

One property assignment is also noteworthy. Faced with a large earthquake risk, Willis created a facultative earthquake facility at the end of 2008. At that time, market capacity was difficult to come by because of the economic and capital conditions that had suddenly developed in the wake of the financial meltdown.

Despite those conditions, Willis Re's facultative team was able to secure more than $200 million in capacity.

Managing Director
Guy Carpenter & Co.
New York

Managing Director
Guy Carpenter & Co.
New York

Senior Vice P{resident
Guy Carpenter & Co.
Chicago