Chief says management arm now equipped to bounce back from loss-making 2010
Run-off specialist Randall & Quilter (R&Q) aims to make its fledgling underwriting management division “a significant driver for profit”, chief executive Ken Randall has said.
The division acts as a managing agent for start-up Lloyd’s syndicates and gets involved in underwriting directly by setting up managing general agents.
It was the only one of R&Q’s four divisions to make a loss in 2010 after investing in staff and infrastructure, turning in an operating loss of almost £1m. The firm overall made a post-tax profit of £6.4m for 2010 from a loss of £171,000 in 2009.
Randall said: “That is money well spent. It has put us in a good position. We expect to make a profit this year but the real benefits will come in 2012 and beyond.”
The division helped Norwegian marine mutual Skuld launch a Lloyd’s syndicate in 2010 and has also set up Canadian and UK MGAs.
Randall said the division is about to introduce an MGA focusing on equestrian events and that there are a couple more in the pipeline.
“We are actively recruiting underwriting teams,” Randall said. “We expect to become a significant player in that market over the next two or three years.”
In a further initiative, R&Q is working on its broker wrap service, under which it assumes control of brokers’ legacy business.
It has already signed up broking firm Gallagher and expects more deals. Randall said: “We have other similar transactions we are moving forward with.”
We say ...
- Setting up underwriting business when rates are soft is questionable, but R&Q should be well placed when prices firm up.
- Opportunities in its traditional area of run-off acquisition are increasing, but diversifying into 'live' business is a smart move.
- R&Q's new broker wrap service niche should serve it well in the future.