A reinsurance deal with Faraday will allow up to a 50% rise in capacity
Advantage Insurance has finalised a reinsurance deal to boost its capacity in motor, as NIG prepares to quit the market.
Liberty Syndicates is also poised to pump fresh capacity into the motor market, as both insurers aim to take advantage of rising rates.
Non-executive chairman Neil Utley said Advantage currently writes around £200m premium but a reinsurance deal with Lloyd’s syndicate Faraday allowed a “lot more scope” to increase capacity – more than 50% if needs be.
Utley said: “We’re not going out for gung-ho growth, but [intermediary sister company] Hastings is growing quickly, Advantage is growing on the back of that, and other brokers are getting business as well.”
NIG is to drain £238.8m from the market by putting its personal lines motor book into run-off in 90 days’ time. But Utley said: “There are a lot of issues like this that seem to be having an effect on rates. That’s why I think it’s quite a good time to be in motor.”
Gibraltar-based Advantage originally underwrote motor and travel insurance from Hastings, but has since expanded to form partnerships with other brokers.
Liberty Syndicates chief underwriting officer Matthew Moore said the hardening UK and Irish motor market was now attractive for trading.
NIG has stressed that it will continue to accept renewals from brokers and adequate reserves would be in place during run-off.