Canadian Underwriter

New chief agent for Canada’s top liability and aircraft insurer

November 22, 2019   by Greg Meckbach

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Lisa Duval is the new attorney in fact and chief agent for Lloyd’s Canada, the nation’s fourth-largest property and casualty insurer when measured by premiums.

Sean Murphy was chief agent in Canada from September, 2012 until last month.

“Taking a knee on the sidelines to catch my breath and focus attention on my children,” Murphy reports on his LinkedIn profile.

Duval’s Linkedin profile indicates she became head of reverse flow and HUB at HDI-Gerling Industrial Insurance in London in 2014. She is a former internal audit manager for RSA Canada.

Murphy became vice president and attorney of fact for Lloyd’s Canada in 2005. Before that he was chief agent in Canada for Kemper Insurance.

In Canada, Lloyd’s led both the liability and aircraft markets in 2018, as reported in the Canadian Underwriter’s 2019 Statistical Guide. Lloyd’s had 23% of the Canadian liability market and 27% of the aircraft market.

With $3.8 billion in net premiums written in Canada in 2018, Lloyd’s Underwriters ranked below Intact, Aviva and Desjardins but ahead of The Co-operators, RSA and Wawanesa – which had premiums of $3.1 billion, $2.466 billion and $2.465 billion respectively. Lloyd’s ranked second (behind FM Global) in the Canadian boiler and machinery market.

Murphy joined Kemper Insurance in 1995 held various roles for 10 years. He studied economics at Glendon College, an affiliate of York University situated immediately north of Toronto’s Sunnybrook Hospital.

The Corporation of Lloyd’s is not an insurance carrier but oversees the market.

Last year, the Corporation of Lloyd’s asked its syndicates to conduct in-depth reviews of the worst performing 10% of their portfolios and of all lines that are losing money. Worldwide, the Lloyd’s market lost £2 billion in 2017 and £1 billion in 2018. It returned to profitability this year, reporting a combined ratio of 98.8% for the six months ending June 30.

On March 27, Lloyd’s announced that eight syndicates stopped trading at the end of 2018. The syndicates are the groups that provide the capital and ultimately pay out on claims.

Lloyd’s Canada has an “Attorney in Fact” system to ensure that Lloyd’s business is considered by the federal Office of the Superintendent of Financial Institutions as being a risk insured in Canada and is licenced by the relevant province or territory.

How Lloyd’s writes insurance in Canada was described in 2018 by Justice Dawn Pentelechuk of the Alberta Court of Queen’s Bench, in the context of a claims dispute between Alberta Motor Association and its reinsurers.

The Lloyd’s syndicates are not legal entities but delegate all responsibility for management of the underwriting business to management agents, Justice Pentelechuk wrote in Alberta Motor Association Insurance Company v Aspen Insurance UK Limited.

A Canadian broker presents the risk to an accredited Lloyd’s broker in London, who then presents the risk to the underwriter of one or more managing agents, Pentelechuk wrote, quoting from an affidavit from Murphy.

After getting a proposed contract from the Lloyd’s broker, the Canadian broker then presents the risk to the client. If the client is interested, then the Canadian broker reports back to the Lloyd’s broker who makes a proposal to the managing agents’ underwriters in London to accept the risk – or a percentage thereof – on behalf of their syndicate.

If the parties agree to the terms, the policy is eventually delivered electronically to the Attorney in Fact in Canada. The client pays its Canadian broker, who remits the premium (minus its commission to the Lloyd’s broker, who in turn remits the payment net of its fee to Lloyd’s, which in turn allocates the premium to the subscribing syndicates.

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