Melvin: BMS Re to expand specialties as part of “ambitious but attainable” growth strategy

By David Bull

Feb 12 - (The Insurer) - BMS Re is looking to get back on the front foot by onboarding new hires including Howden Re’s Genna Biddell and Jonathan Hughes as it focuses on client retention and also doubles down in the US regionals and programs space while looking to expand its specialty capabilities, according to CEO Brad Melvin.

Former Aon reinsurance solutions veteran Melvin officially joined the intermediary as the replacement for Pete Chandler in November last year.

And in an exclusive interview with The Insurer, he said that after a challenging period for the firm, BMS Re is now positioned to return to the growth trajectory that has seen it double in size in five years.

“My job is to try to double it again in the next five to six years. We’ll do that by having more clarity on what we’re focused on and hiring people that actually have relationships and capabilities in areas where we’re not in, or areas where we are but think there’s more opportunity,” said the executive.

Early hires include Biddell, who joins from Howden Re where she was a managing director and will head up BMS Re’s London P&C team in a move that reunites her with Melvin after spending a decade at Aon earlier in her career.

Hughes was also most recently a managing director at Howden Re in London and joins with a retro focus, albeit reporting into UK chief growth officer, Hannah Watkins.

The attention will now turn to hiring in the US, with Melvin revealing that the firm’s backers including French private equity firm Eurazeo have approved a plan to invest in the talent required to increase its capabilities, as well as support potential bolt-on M&A opportunities.

The emphasis will be on attracting talent from other brokers to bring a growth mindset across the business.

“If you’re client services, a cat analyst or broker you have to get up every day and say ‘Hey, how am I going to serve my client more effectively and help us grow the business,” said the new BMS Re CEO.

Melvin said that he is currently in the “strategy development phase” for the reinsurance intermediary, with a timeline to move that through to the execution phase after detailing plans to colleagues and the market by the end of next month.

Since his arrival there have been further redundancies as part of BMS Re’s move under its new CEO to reposition its business strategy for growth.

As previously revealed by this publication, these have included the departure of former interim co-CEO Russ McGuire and executive vice president Daniel Bilot.

The Insurer also understands that other exits include Erik Manning and James Ferris, along with other members of the firm’s capital advisory team in Bermuda and London as BMS Re instead solely invests further in the US team led by Andras Bohm, who joined from Swiss Re in 2023.

Those came after a series of exits for a variety of reasons in the year prior to Melvin’s arrival, including from the more senior management ranks that had been brought in by Chandler in a highly active hiring strategy.

From exits to investment

Although he wouldn’t comment on specific departures, Melvin said that the latest moves now draw a line under the past.

He added that he is confident he has full commitment from the team of 30 plus leaders across the business he brought together at the end of January to discuss the firm’s ongoing strategy and growth opportunities.

“The negative press was not fun for this group of people but those that are here are excited about being here and I’m spending every day building trust. I can only do that by making decisions that are good for our clients and our colleagues, and ensuring the decision I made about right-sizing the business was well understood.

“So the morale didn’t go down because of what happened. Our people see it as a fresh sign that somebody is looking at the business, doing their due diligence, and focusing our investments in talent and new opportunities,” he said.

In the interview, Melvin said he came into the role with his eyes open, fully aware of the challenges BMS Re has faced over the last 18 months, and the need to win over current employees and future hires as well as have a laser focus on client retention.

“I had a successful career at Aon and I wasn’t looking to leave. But after [the BMS Re approach] and a short period of due diligence I was convinced this was a really good opportunity. I can tell that story from my heart.

“We need to have 100 of those conversations. If only 20 percent of them say, ‘Hey, this is for me, I’m ready to leave a big company and work for a company like yours where the opportunity is immense, then I’ll be rewarded for my efforts’, that’s great,” the executive commented.

He added that he has a track record of retaining and growing businesses, including responsibility for driving retention through the Aon Benfield merger, launching and leading the firm’s global accounts business, and launching Aon’s Regional Insurer Group in the US.

Melvin highlighted the size of the reinsurance brokerage market in the US – which generates some $6bn of revenue.

“We have a small fraction of that so there’s opportunity to invest in people and more capabilities, not to attack the larger brokers, but to get our share of additional business. People are excited about that, and people feel that a smaller, independent broker with strong capabilities like ours can make a difference,” he added.

More clarity around offerings

Melvin said one area of focus as he sets his strategy for the firm is bringing more clarity to its offerings in the US as it looks to invest in talent and add to its capabilities.

He said the intermediary will double down on what he described as a strong regionals and mutuals book of business; and its “very successful and growing” programs segment.

Although he wouldn’t comment on individuals that have left the programs team – including former co-leader Des Bohan, who has since joined Guy Carpenter – Melvin said that despite the departures the book is still “growing like a weed” under John Speckman.

“We have to continue serving the [program] aggregators and hybrid fronting carriers with excellence and we’re going to keep investing in people in that segment,” he stated.

BMS Re’s third main pillar of business is specialty business. But Melvin noted that the firm is currently only in a limited number of specialty lines.

“We wanted to get some clarity around those segments, let’s focus and double down on regionals, specialty and programs, but let’s expand the specialty products we’re in,” he said.

The firm currently has a property book that accounts for around a third of its overall business, along with an established casualty team – including a London arm – that places business and provides solutions in segments such as non-standard auto, commercial auto, general liability and excess liability.

It also has a strong presence in healthcare, led by Andrew Wheeler, and both property and casualty facultative business.

“But things like A&H, surety, inland marine, financial lines – these are all areas we’re evaluating for future investment,” Melvin revealed.

Other specific areas of focus include building out legacy and structured capabilities in the US, with the firm eyeing opportunities to bring solutions to carrier clients, especially given the current focus on prior-year reserves and loss cost trends.

Realistic budgets and retention strategy

In the interview, the new BMS Re CEO was questioned about how he will return the firm to its previous growth trajectory after significant turnover of personnel and the threat of account leakage as the firm repositions under his leadership.

This publication has previously reported that the intermediary came in below of its 2023 revenue growth targets and sources have said it also fell short of 2024 targets amid the disruption.

Although he wouldn’t comment on the approach of previous management, Melvin said an important part of the repositioning of the firm and its ability to retain and attract talent is to set realistic expectations.

“You need to start with a realistic budget. I can only tell you that the budget I’ve been part of putting together is a more realistic version of where we are and where we want to go. Let’s make sure we have a budget that is ambitious but attainable,” he commented.

“I feel like when the US leadership sat together last month and walked through where we are and where we’re going there was nobody in that room that felt like they’d been thrown under a bus with a number they can’t achieve. That doesn’t mean that we’re not going to grow in 2025, but it means we have a more realistic view of the world,” he commented.

Melvin was also asked about the change in coming from Aon, where the reinsurance intermediary has the ability to leverage retail relationships, to BMS Re where there is no US retail presence.

“I’m excited that we’re independent,” the executive said.

He added that at Aon he had helped build a portfolio of mutuals and regionals that didn’t have inwards business from the firm’s retail arm, instead winning business through “good old-fashioned relationships, great analytics and doing an unbelievable job for our clients”.

And he doesn’t believe BMS Re is limited to those carrier segments.

“We are already working with large insurers. If we invest in the right specialty areas, we will work with the larger carriers and show we’re actually better at, say, healthcare as an example, than anyone else – give us a shot to compete and we can add value,” he suggested.

Melvin said that the reinsurance arm of BMS will also look to work closely with UK CEO Ian Gormley and the firm’s wholesale business in London sourced via US retail aggregators.

“There are reinsurance opportunities falling out of that in the US where we can collaborate more closely with Ian, Hannah (Watkins – UK chief growth officer) and Nick Cook (BMS Group CEO) that we can capture through increased connectivity,” he commented.