Markel eyes ‘magic’ in synergies between units: new leader Noble

The key to the future success of  Markel’s global insurance platform, comprising insurance, reinsurance, programme services and ILS, will be unlocking the synergies between the different pillars of the business and creating solutions for clients simply not available elsewhere.

That is the view of Jeremy Noble (pictured left), the executive charged with taking the reins of the unit following the departure of Richard Whitt (pictured right), co-chief executive officer of Markel, who plans to retire by March 31, 2023.

Upon Whitt’s retirement, Tom Gayner will become the company’s sole CEO. But the global insurance platform will come under the leadership of Jeremy Noble, senior vice president and chief financial officer, reporting to Gayner. Full details of the change in leadership can be found here.

Speaking in an exclusive video interview with this publication, Noble said that, so far, the company has only scratched the surface of what is possible. He noted that the company acquired State National, its programme services business, in 2017; and it bought Nephila, now its ILS business, in 2018. Thus, it is only at the start of the journey of exploring what is possible.

“We have been working to get cohesion across our leadership teams, but we are only scratching the surface so far,” he said. “Each has its own strategy and business plan and there are no plans to restructure, but we want to explore ways to unlock value from the different platforms in a way that pulls all of their capabilities together.”

He noted that one specific example of where this has been done successfully was after Markel exited property-cat business in 2020. In the aftermath of that decision, many clients were supported through Nephila’s ILS capacity. “That was a great example of how synergies between the organisations can work,” Noble said.

Whitt agreed with this strategy, arguing that no other carrier has four platforms representing the size and capability of those Markel now offers. “I do not believe anyone else has that capability. The magic will be in bringing those pieces together to create solutions for clients that I am not sure they will be able to get anywhere else.”

Noble also acknowledged that market conditions in its insurance segments are favourable at the moment, thanks to a continuing hard market. But he also emphasised the fact there is much nuance in this statement and challenges remain in a number of sectors, notable property-cat.

He admitted that, for Nephila, and the ILS sector more generally, this has meant some challenging years on the back of elevated claims. “But Nephila has done a great job of maintaining assets under management as well as offering some great market leadership amid uncertainly and volatility.

“The team’s thoughtfulness around things like climate change really positions them well for the future. As such, we have a high degree of confidence in the ILS operation, which complements our broader reinsurance operation.”

He added that during what he calls a favourable environment for pricing, the company has also focused on “thoughtfully” working on its portfolio construction, building out relationships and expanding its product capabilities. “All this means we are in a great spot, regardless of the rating environment being still good.

“The picture is becoming more nuanced. There is a gradual decline in rates but they are still above loss cost trends. Inflation, both economic and social, is a topic we are also focused on but this is where our diversification comes in. We have more than 100 product lines, which allows us to manage market cycles. It means we can consistently perform at a top level and sustain that regardless of the cycle.”

Asked about the timing of the announcement, Whitt said he had always planned to retire at 60. He will now do this two years early, but he felt the time was right given the current leadership team and market conditions, while also ensuring a smooth transition. He said he was proud of what he had achieved with the business, especially the growth of its insurance business.