It’s New Year’s Eve, and David Falk, Head of Property Underwriting at NewRe, has ridden his Vespa to work as he does most days. It can be a bit of a slog getting up Flühgasse, especially when the Vespa is carrying two passengers (David’s wife usually rides into the city with him). But today he is alone. “So I was very agile!” he later recalls. The office is practically deserted. David is awaiting last-minute details of a deal that has to close today. A deal that materialised only a short time ago. This is how it happened.
Flashback to autumn
NewRe does 75% of its renewals business from mid-November to the end of December. It’s typically a period of intense activity. Now, already late into the renewal period, a client visits NewRe along with a broker. They are met by David and Florent Sennelier, a senior underwriter. The client, a large listed company, has suffered disappointing results and its shares have fallen sharply. The CEO wants to avoid further earnings volatility. Because the company already has plenty of reinsurance, the broker proposes filling the gaps in the existing cover. The new business is a significant opportunity for NewRe. However, it’s complex, and taking it on will mean closing the deal by 31 December. That’s less than a month and a half away. Nonetheless, the NewRe duo tell the broker to count them in.
Strategising a work plan
David and Florent receive a concrete proposal from the broker. They quickly assemble a small team and allocate the necessary resources to it. Because the company works on a pan-European basis, with some of the team very busy and others less busy, it’s possible to shift things around. The deal consists of several subcontracts, so David and Florent divide them up. They work with a pricing actuary at NewRe to be sure they are pricing all the gaps. The team also crafts the details of the complex legal wording of the contracts to make sure everything fits.
13 December - Forging ahead
NewRe delivers a quote to the broker. The broker responds positively – a major milestone. When David and Florent first met with the broker in November, he told them that they were the 30th reinsurer they’d approached for the cover. “But it quickly became clear that NewRe was the leading market”, says David later, “and probably one of the few that has the capabilities to make the deal happen on short notice late in the renewal period”.
20 December - Waiting
In the days leading up to Christmas, having now also gained the full support of NewRe management, the team finalises the pricing and communicates it to the broker. With the pricing agreed, all that is needed is the actual contract wording from the client. But then things go silent. Part of the silence is just an artefact of where the working days fall in the calendar, including the Christmas “bridge”. But when 27 December comes and goes, and the team still hasn’t heard, the pressure increases.
28 December - Down to the wire
To the team’s immense relief, the client forwards the finalised wording. But, as frequently happens, the devil is in the details. The actual wording is not entirely in line with the original offer. The next day is the start of the weekend. And by now, Florent is on a skiing holiday in the Swiss mountains. There is only one working day left.
A tight close!
Which is why David is in the office when most people are preparing to usher in the New Year. At lunchtime, he ducks into town to buy a black-tie suit for the evening’s festivities. Returning to his desk at NewRe, David alternates throughout the afternoon between phone calls to Florent and calls to the broker to fine-tune the contracts. By 6 o’clock the deal is done and dusted. David inks the documents and sends them off. Florent is on a bus back from the slopes to his hotel when David rings him on his mobile to relay the good news.
The Vespa is an apt metaphor for what makes NewRe special. It’s stylish, small and agile. The NewRe team was able to size up a complex situation in short order, reallocate resources effectively, act quickly and with skill, and marshal management support efficiently. They also had the trust of the broker – a key player in this case – which stood them in good stead during those last critical days of December. Indeed, the successful conclusion of the deal further enhanced NewRe’s reputation as a reliable partner. “It was clear to the broker already”, says Florent today. “But to the client, we really made a difference.”