NEWS
AXA XL’s Twite eyes a smoother renewal
AXA XL Re in Bermuda has made solid progress in rebalancing its portfolio and reducing volatility, says CEO Mark Twite.
Mark Twite is hoping for a less frenetic 1/1 renewal season this year. He experienced a baptism of fire in 2023, taking over as chief executive officer of AXA XL Re in Bermuda just months before the end of the year. He admits he was thrust into “a frantic and turbulent” renewal season with policies being written up to the wire.
Twite, who is attending the Rendez-Vous de Septembre in Monte Carlo for the first time in his career, said he is approaching the annual gathering with an open mind.
“I’ve looked at how 2023 is progressing and we saw that 1/1 was frantic and turbulent, with policies and treaties being written late in the day, and I’ve seen how that has developed through April 1 and June or July, where there has been a more general transparency and understanding over rate adequacy,” he said.
“As we’ve shifted in 2023, that turbulence has metamorphosed into order and equilibrium. So, what I hope to see on 1/1 2024 and beyond is a continuation of the transparency, and a continuation of the stability that comes from having price adequacy.
“What we’ve seen is that capacity is there at the right price. What I expect in those conversations in 1/1 2024, and in Monte Carlo, is the general understanding we’ve seen over the last few months continuing into that.
“We’re going to Monte Carlo with an understanding that capacity can be provided at the right price. I believe the brokers and clients share that view and it will form the basis of ongoing dialogue.”
Twite, who previously was chief financial officer of AXA XL Re in Bermuda, said he would welcome more price stability in rates, provided that it came from a disciplined underwriting process.
“Capacity is there at the right price.”
Mark Twite, AXA XL Re
“If you can have a disciplined process which ensures that the capacity and the lines of business we provide are treated respectfully at the right price, that creates stability,” he said. “Then you’re talking to your clients about different things: about risk mitigation, about their views, where they’re looking to grow or change their business.
“You’re not talking about price, you’re talking about the real things that matter to the clients and how we can support and help them on that.”
The model is working
When Twite took the reins of the Bermuda reinsurance operation, he was tasked with rebalancing its reinsurance portfolio and reducing earnings volatility.
Twite said the company has seen growth in marine and energy and in cyber reinsurance.
He said: “We’re still a property and a property-cat player, but I’m trying to keep increasing the specialty element to generate balance, and in 2023, we’ve been very successful at that.
“There is still some way to go for me to feel we have a portfolio that is sustainable not just for 2024 but for multiple years. So, I’m going to be making sure everyone is aware that we still have the full capacity, but I’m also going to have conversations about marine, energy, whole accounts, cyber—areas that will enable us to have increased balance in the Bermuda portfolio.”
As to reports that AXA Group was considering selling AXA XL Re, Twite said: “Over the last three years, particularly in AXA XL Re in Bermuda, we’ve worked very hard on rebalancing the portfolio, on managing the cat exposure within our tolerance levels.
“I’m trying to keep increasing the specialty element to generate balance.”
“It’s now at a level we’re comfortable with and it’s performing well because of that. For me, and this is what my bosses and my bosses’ bosses have asked of me, I am focused on creating a sustainable contributor to AXA XL’s underlying business and ultimately the AXA Group and there is recognition at Group level that the model is working,” he said.
Twite said the specialty lines all have an element of catastrophe reinsurance within them, but they diversified the company’s portfolio and took advantage of the underwriters’ expertise.
“We can’t write marine and energy or cyber and not have an element of cat exposure,” he said. “I like the marine and energy market. I have a very good underwriting team with experience and knowledge there.
“I would like to take advantage of their excellence and skillsets to keep developing a book of business we’ve been in for decades,” he said. “Increasing our exposure there while managing our catastrophe exposure is the right thing to do for this platform.”
Twite said it was important always to remember who the re/insurance industry serves and why catastrophe reinsurance remains important.
“Just because rates change in property-catastrophe does not mean that the expectation of loss changes,” he concluded. “I know there will be natural catastrophes across the world in 2023, 2024, 2025 and 2026. We need to be ready to support our clients, who ultimately are supporting those individuals on the ground. “
Main image: Shutterstock / nadtochiy
