Brokers' use of London market follow facilities grows as more syndicates offer tracker capacity

By Henry Gale

April 11 - (The Insurer) - Several brokers have expanded their follow facilities or launched new initiatives in recent months, as enhanced underwriting starts to streamline the placement process in the London market.

Howden last week became the latest broker to announce a tracker facility, Howden Auto Tracker, in a shift from previous smart follow initiatives under the brand Rethink. Gallagher and McGill and Partners have also launched follow facilities in the last six months, while Aon, Marsh and Amwins expanded their existing facilities.

Gilbert Harrap, CEO of InsurX, told The Insurer TV in a recent panel discussion that the tech firm believed seven of London's top 10 brokers now have an active tracker facility. "They will largely look to fill that out so it can cover more classes of business," he added.

Smart follow initiatives involve automated rules or processes to allow syndicates to write follow business with minimal human involvement in individual risk decisions. This is sometimes done through portfolio underwriting, where insurers choose to provide capacity systematically to risks placed by a certain broker or written by a particular lead that meet other criteria.

More insurers are beginning to deploy capacity in this way, with Aegis London the latest to announce a portfolio underwriting team in January. While many broker smart follow initiatives are supported by underwriters such as QBE and Beazley Smart Tracker Syndicate 5623, which have been active in portfolio underwriting for some time, others are starting to support the facilities too.

Munich Re and Canopius are among the carriers now backing more than one follow facility, while algorithmic underwriter Ki, which initially focused solely on open-market risks, has begun supporting them too. The Insurer reported in January that Ki was among the new backers of Amwins' Amplify facility.