After more than 30 years Willis Towers Watson (WTW) has seemingly concluded that it can no longer make a buck offering insurance to businesses that have been placed in external administration.
Earlier this month the global insurance behemoth acted on that conclusion by shutting Open Cover, its popular automatic insurance facility for entities placed into external administration.
While WTW Professional & Financial Lines Leader Jill Stewart did not respond to a request for comment prior to iNO’s deadline numerous industry sources confirmed the closure.
One told iNO that it was a difficult and extremely specialised area that had seen off insurance industry gorillas like AON and Marsh.
“It’s grinding, complicated work, the source said. “Every appointment is different. What are the exposures? What are the compliance issues, the run-off issues?”
The source said it was also difficult to get staff capable and willing to take on the work which is complex, varied and requires a thick skin.
Another source warned that the exit left just one major broker – Arthur J Gallagher (AJG) – with specialist expertise in the insolvency and turnaround space.
“This can’t be good for the IP (Insolvency Practitioner) industry,” the source said. “Monopolies never are.”
It will however likely be good for AJG, particularly in a market place where the rate of enterprises entering formal external administration are increasing.
AJG’s insolvency and turnaround division head Mike Looney wouldn’t say if he would try and capitalise on his rival’s exit by scooping up skilled staff looking to continue their careers in this niche of niches but he did take the opportunity to promote his firm’s approach.
“Given the specialist nature of the Insolvency & Turnaround sector, we have in Gallagher specifically structured our Insolvency & Turnaround Team to solely focus on this space ie: our I&T Team does not additionally work on general insurance accounts outside of servicing our Insolvency & Turnaround Clients,” he said.
“We have in 2023 continued to expand our Insolvency & Turnaround Team resources to ensure we have the local capacity to best assist our Clients.”
With Open Cover no more, the next question registered liquidators are likely to be asking is how long WTW continue to offer professional indemnity (PI) cover.
As one source said when asked if they thought that following the termination of Open Cover WTW would look to withdraw from the PI market the reply was succinct. “Absolutely”.