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The Week: Execs speak on transition, Dems take Senate, Spac boom, broker talent war


1. Industry executives speak out on peaceful transition of power

Outside the insurance industry, 2021 began much in the same way 2020 ended, with political tensions in the US and the ongoing pandemic continuing to intensify by the day. As Covid-19 case counts and hospitalizations reached record highs, Washington on Wednesday descended into chaos as protestors stormed the Capitol in attempt to block the certification of the presidential election results.

Leaders from around the insurance industry joined executives from elsewhere in the business community in using their platform to speak out in defense of the democratic process and the sanctity of the rule of law.

Chubb’s Evan Greenberg and Alan Schnitzer, the CEO of Travelers, separately condemned the outbreak of violence and actions being taken to overturn the election results while, earlier in the week, MMC’s Dan Glaser, AIG’s Brian Duperreault and Swiss Re’s Philip Ryan signed a letter calling on Congress to certify the election result.


The comments from the executives mark a continuation of industry leaders exercising their influence on matters beyond the realm of the market, as was seen last year amid the groundswell of support for the social justice movement after the George Floyd protests.

One industry professional was dismissed from his role at the insurance broker Goosehead for participating in Wednesday’s events and livestreaming his involvement on social media.

2. Democrats win Senate control

Almost lost in the mayhem of the DC rioting was the final result of the 2020 election when, on Tuesday, the Democrats retook control of the Senate for the first time since 2014 after capturing two seats in Georgia run-off races. The results upend earlier expectations of divided government that would have forestalled most of president-elect Joe Biden’s agenda.

The razor-thin Democratic majority in both the House and the Senate is likely to a bring mixed outcome for the P&C industry, the most consequential perhaps being the prospect of higher corporate taxes.


Biden campaigned on the promise to partially reverse the tax cuts passed at the end of 2017, raising the standard corporate tax rate to 28%, up from the current 21%, but below the 35% effective rate prior to the 2017 reforms. With the Democratic majority relying on the casting vote of Vice President Kamala Harris, it is not clear whether Biden will be able to command enough support to move the rate.

Indirect impacts on the industry from the election outcome also include the much higher likelihood of economic stimulus and infrastructure spending – both of which could add to inflationary pressures – as well greater movement on climate change policy.

President-elect Biden has already said he intends to rejoin the international treaty on climate change, also known as the Paris Agreement, and may now be in a position to enact legislation on carbon pricing or implement a cap-and-trade system to achieve those objectives.

3. Spac boom rolls on

Following three high-profile InsurTech public listings in 2020, momentum in the sector continued this week with the public debut of Kairos, a special purpose acquisition (Spac) vehicle that raised $240mn and that has the involvement of several notable industry executives, to go along with backing from Mike Millette’s Hudson Structured Capital Management.

The move is part of the rapid growth in popularity of Spac deals across all sectors, but is also the latest sign of public market interest in the InsurTech space heating up.


Investor interest in InsurTechs with promising business models has continued unabated. On Thursday, Lemonade’s share price spiked to a record high, soaring by almost 30% after the online investing site Motley Fool pick the company for its stock of the month. The New York-based digital carrier’s share price has tripled since November, taking its market cap to $8.6bn.

4. Broking talent war intensifies

With the merger between Aon and Willis Towers Watson expected to close in the first half of 2021, the fight over talent has continued to escalate in the first week of the year.

On Wednesday, Inside P&C reported that Alliant had recruited a 15-strong Willis broking team, led by the broker’s trucking and logistics leader Dee Anderson, to open a new office in Knoxville, Tennessee.

The news follows a steady stream of departures from Willis’ retail unit in the second half of 2020. It is understood that competition among rival brokers to lure away talent – especially among Alliant, NFP, CAC Specialty and Epic – has stepped up in recent weeks.

On the reinsurance side, Willis Re won a court battle with Guy Carpenter after a Miami judge granted the broker an injunction that blocks a group of brokers who had left Willis for Guy Carpenter in November from soliciting former clients.

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