RKH Speciality News

Specialty lines broker, RKH Specialty, part of the Hyperion Insurance Group (Hyperion), positions itself to become a leading player in the Surety market with the acquisition by Hyperion of the UK’s largest independent specialist Surety broker, PMG Financial Services Ltd (PMG), subject to regulatory approval.

Barnaby Rugge-Price, CEO of RKH Specialty commented: “The acquisition of PMG represents a significant opportunity for us. PMG’s considerable experience in arranging solutions for the world’s largest corporations, and reputation for handling the most complex bond needs, will provide the platform for RKH Specialty to become a market-leader in this niche specialism. Combine this with the already strong international presence of the Howden network and the Group has real potential to become the leading international Surety broker.”

In January this year, Gert Schlossmacher joined RKH Specialty from Euler Hermes, to develop its International Trade Credit business. Already a market leader in Political Risks, RKH Specialty plans to achieve similar status in Surety and Trade Credit as a result of these two key initiatives.

Rugge-Price continued: “Financial Risks is a key growth area for RKH Specialty and so I am delighted that in Neil Galletti, Gert Schlossmacher and Paul Philand we have the market’s top talent across the three core competencies of our Financial Risks business: Political Risks, Trade Credit and Surety.”

Paul Philand, MD of PMG, stated: “RKH Specialty, and the wider Hyperion Insurance Group, offers a unique opportunity to grow the business both by enhancing the offering to existing clients, with access to the greater resources of the wider Group, and by reaching new clients through the international broking network.”

“I am extremely proud of PMG’s achievements over the past 15 years and am convinced Hyperion’s employee-ownership model and entrepreneurial culture will allow the business to thrive in its next stage of growth.”

As Global Practice Leader for Surety within Hyperion, Philand will work closely with Hyperion’s retail broking business, Howden, which has the largest independent retail broking network outside of the US, and underwriting arm, DUAL, using his expertise to advise on opportunities across the Group.

Find out more about our Surety services >

October 2015: Introducing RKH Specialty

Following the completion of the merger between RKH and Hyperion in April 2015, RKH Specialty was created to bring together the international specialty lines expertise of Howden and RKH, improving both the breadth and depth of products and services on offer.

This new website provides information and contact details for every area of the new RKH Specialty business.

Find out more about RKH Specialty

Find out more about our products and services

Contact Us

The Sunday Times is one of the first to acknowledge the achievements of the combined force of RKH and Hyperion following the merger.

Placed in the Sunday Times HSBC International Track 200, which ranks 200 companies according to growth in international sales over the last two years, Hyperion Insurance Group ranks at 117. Advancing on RKH Specialty’s singular achievement of 164th last year, it is recognition of the two groups’ combined strength. The Sunday Times notes that Hyperion Insurance Group “will generate more than 30% of revenues in the US following its merger with broker RKH.”

Amanda Murphy, UK head of corporate banking at HSBC, commented:

“The Sunday Times HSBC International Track 200 is a great reflection of the value of building connections overseas. The world is getting smaller, and international business relationships are easier to build, providing ambitious businesses with many more opportunities to grow. I’m delighted to see so many great British mid-sized firms making such a strong impression on the world stage.”

The Sunday Times league table can be viewed here.14

A RKH Specialty survey focusing on evolving insurance risks highlighted that 80% of insurance professionals are witnessing an increasing need for specialist risk coverages to provide better- targeted solutions for a wide range of P&C exposures. Of that significant percentage, about 39% recognised that the increasing need for specialist risk coverage is growing fast.

The survey also uncovered that supply chain disruption was the top property risk exposure with 61%, with flood and tornadoes following with 30% and 9% respectively. Cyber was identified as the top casualty exposure at 70%, with product risk and drones highlighted as the next largest risks at 11% each.

Conducted at RIMS 2015, this survey represents the views of US-based insurance professionals, its results are also reflected by other international research: nearly half (46%) of financial services professionals globally named cyber risk as their number one concern, a record high level according to a survey by DTCC, one of the world’s largest clearing houses. A Deloitte survey also validated the global concern surrounding supply chain disruption, identifying that there are now more risks to the supply chain and risk events are more costly.

“Losses stemming from cyber-related attacks and business interruption can be catastrophic for individual business,” said Barnaby Rugge-Price, RKH Specialty’s CEO. “Healthcare and retail have been the major buyers in the cyber space to date but we are seeing an increasing conversion rate across the whole of our portfolio. After a number of years of looking at the offering, clients are increasingly deciding to purchase the cover as the product has improved and the frequency of attacks has continued to increase. There has also been a heightened focus on the business interruption aspect, where cyber attacks can cause whole facilities to shut down. But whether cyber related or not, any interruption to the supply chain can cause a disproportionate loss. The survey highlights the importance of specialist insurance for a whole host of emerging risks.”

With 47% of survey respondents indicating that they tend to turn to domestic US brokers for their specialist risks and other emerging world markets in close pursuit, London offers a unique ability to support that demand. Barnaby Rugge-Price comments that U.S. clients tend to “seek the best value from their insurance spend by tailoring coverage around their firms’ specific exposures and needs. Our aim is to respond to the increasing requirement with specialty product advice and placement services around the globe. We will continue to work with our markets to ensure we are responding to each request, providing real value in both coverage and capacity.”

The full survey results can be viewed here.

Following the merger of RKH and Hyperion, RKH Specialty has been conceived to combine the specialty lines expertise of Howden and RKH, improving both the breadth and depth of products and services.

With British Airways and TV5Monde recently suffering cyber attacks, they join a growing list of mammoth organisations that have been targeted. Attacks on this scale make headline news, however there is little of the effects on smaller companies. The costs of recovery, informing customers and potential fines to smaller companies can be debilitating. RKH offers insurance both in the UK and US to protect against the costs and provide expert guidance to ensure businesses emerge with their reputations still intact.

Smaller firms “are exposed to many of the same attacks as much larger enterprises, yet they don’t have the security expertise and resources available to larger firms” comments Maxim Weinstein, a security advisor at Sophos in a BBC article. In fact, figures from Sophos indicate that around 30,000 websites are being targeted by cyber attacks every single day, with a single breach for small companies estimated to cost more than $100,000 (£67,758) or as much as $1.4 million (£948,618) for large companies (McAfee report). With cyber thieves churning out around 250,000 new virus variants daily, cyber security is an issue worth moving up a small company’s priority list. Most of the lower level threats can be defended against with anti-virus software, firewalls, spam filters and crucially, keeping devices updated, however some attacks are inevitable.

A business can be defined by its reaction to a cyber breach. Reaction is key, not only in terms of customer opinion and brand integrity, but also to avoid legal and regulatory consequences. In the US, new legislation requires businesses to notify consumers within 30 days of a breach. In the UK, a business can be landed with a hefty fine by the Information Commissioner if they are found to have not handled the breach effectively. Even when outsourcing data handling, the responsibility for customer data lies squarely with the business in question. Knowledge gaps often exist between the advanced technology smaller businesses use and a lack of data security and breach expertise.

R K Harrison offers flexible solutions for all sizes of business protecting against the potential costs of a cyber breach, with immediate access to specialist advice when needed. The dedicated team have a wealth of wide-ranging cyber experience and are geared to deliver a crucial, quick response. Expert guidance ensures implementation of the correct procedures and fine-tuned communications; minimising chances of a fine and reputational damage. Access to a forensic team identifies the true extent of the damage, and pinpoints only the customers who need to be informed.

To find out more about cyber insurance, please contact David Rees.

The growth of the global economy and product distribution has led to a corresponding rise in multi-jurisdictional law-suits. Differing legal and regulatory standards in different territories create a breeding ground for legal action against product manufacturers and distributors. Regulators and lawyers are increasingly watching developments in other countries, further facilitated by digital communication via social media and public online databases such as the OECD Global Recalls Portal. RKH Specialty Specialty’s new Products Liability facility provides an insurance solution that responds to these developments.

Whilst international regulatory product standards offer the future prospect of greater harmony and clarity, the current reality is an increasing cost of compliance and certification for firms. This is particularly the case in the US, where recall standards are becoming more stringent under the Consumer Product Safety Commission’s newly enhanced powers, and the trend for extremely high damages payouts awarded by juries continues upward.

The statistics show that product related issues are not just related to high profile, high-tech and complex products, the vast majority of injuries are linked to a range of everyday household items. For example, the Center for Injury Research and Policy at Nationwide Children’s Hospital in Columbia found that nozzled bottles are responsible for an increasing number of injuries to children related to household cleaning implements. The U.S. Consumer Product Safety Commission identified extension cords responsible for around 4,700 residential fires, 50 deaths and 280 injuries a year. Indeed in 2012, there were 709,000 serious injuries caused by defects in beds, and 714,000 injuries related to tables and chairs in the U.S.

RKH Specialty Specialty’s new Products Liability facility provides cost-effective coverage for tougher liability classes such as E-cigarettes, trampolines, nutraceutical, furniture, electrical and consumer products. The facility is backed by Lloyd’s of London (recognised in over 40 Countries), and it offers the ability to provide state of the art enhancements that assist clients in mitigating and controlling their product liability exposures.

Contact Justin Whitehead to find out more.

Last year three times as many vehicles were recalled in the US than were sold in 2013. This is equivalent to 63,000,000 vehicles which if lined up bumper to bumper, would surround the world 6 times!

This is not expected to be a fluke year; recalls are predicted to increase even further. Reports anticipate that this is due to changes in car production – “parts are being shared between cars and manufacturers in volumes not previously seen before” which “could pose huge problems if a faulty part enters the chain” says Ian Fletcher, senior analyst at IHS Automotive.

Another contributing factor is the rapidly increasing complexity of vehicle design – a typical car contains about 30,000 parts and 10 million lines of software code. Manufacturers are consistently under pressure to make them safer, more environmentally friendly as well as satisfy consumers’ rising expectations of styling, power, handling reliability and gadgets. Meeting all of these requirements demands great complexity, making recalls “an industry challenge that will only intensify as vehicles integrate ever-more-elaborate hardware, software, safety equipment and creature comforts” as reported in the Harvard Business Review.

The threat of increasing recalls goes hand in hand with car manufacturer’s heightened caution of parts suppliers. This new level of threat is reflected in the growing trend for car manufacturers to mandate that parts manufacturers purchase recall insurance. Car manufacturers are looking at their suppliers with more scrutiny and considering ways in which the supplier can take more responsibility and ultimately potential cost in the event of a recall. This growing pressure on auto-parts suppliers to raise quality standards (as explored in the Insurance Journal) is heightened further when also contending with a more scrupulous National Highway Traffic Safety Administration. The recent proposal to nearly triple the NHTSA budget would more than double the office’s headcount, almost certainly leading to more safety defect investigations (Automotive News).

There are comprehensive recall insurance solutions available to protect automotive parts manufacturers anywhere in the world. The product protects against the cost of a recall as well as the installation costs and also provides specialist guidance throughout the recall process.

To find out more about our solutions for automotive parts manufacturers, please contact Rob Marshall.

Click here to download the brochure.

CEOs and CFOs of early-stage or start-up biotech and pharma companies most often mention security finance from investors, protection of their intellectual property and the conduct or regulatory authorities as their biggest issue. Typically such companies are offered simple commercial insurance package policies designed to be all things to all businesses, but often omitting protection for risks that life science companies identify as most relevant.

Working with insurers that specialise in the sector, Ian Thomson, RKH Specialty healthcare team’s life science consultant, is developing coverage that will be much more effective for small and start-up companies’ needs.

These enhancements are largely based on research and analysis from discussions with individual life science companies and further informed by Ian’s 27 years’ experience with GlaxoSmithKline. However it is a process of continuous improvement, Ian continues to have many and varied conversations with companies identifying specific coverage requests that are being developed by units in RKH Specialty and insurers. “It’s a real buzz” he says “to identify how much benefit can be brought to companies off the back of a simple conversation.”

For further information please contact Ian Thomson.