Hiscox chairman: Willis Global 360 talks ‘stalled’

Talks about Hiscox’s participation in Willis’s Global 360 subscription programme have “stalled”, according to Hiscox chairman Rob Childs.

Hiscox had agreed to provide capacity to the Global 360 programme, Willis’s version of the controversial Aon/Berkshire Hathaway deal, on the condition it would be given underwriting authority for the risks it accepts through the programme.

However, Childs said Willis had yet to meet Hiscox’s conditions.

Childs told Insurance Times: “We made a decision a long time ago and we put forward a plan that we would participate on a basis which gave us authority.

“We still have that offer in the table but [Willis] haven’t been able to meet our requirements, so I would say the negotiations are stalled.”

When asked about the likelihood of eventually signing up, Childs added: “The engine has stopped and we’re not quite sure when it is going to start again.”

Willis declined to comment.

Willis announced in October that Hiscox, People’s Insurance Company of China and Berkshire Hathaway had offered to support Global 360.

However, Hiscox clarified shortly after the announcement that it had not yet formally signed up to the programme.

Hiscox London Market chief operating officer Sasa Brcerevic told Insurance Times at the time: “We feel that we are close but we haven’t signed up – and it’s not a formality. There are still certain issues that we’re working through.

“We are going through selecting exactly we will be participating on, to what extent, and what we feel comfortable with.”

Under broker subscription programmes, an underwriter or group of underwriters gets guaranteed participation on certain business that a broker places into the market.

Under the Aon/Berkshire deal, Berkshire Hathaway gets a guaranteed 7.5% share of any subscription business Aon places into Lloyd’s.

The deals have proved controversial because of participating underwriters’ willingness to passively accept business at terms dictated by other firms and the potential for the deals to push smaller underwriters aside.