Horses for courses: Markel market leader for horse insurance | Insurance business America
Pony clubs to Arabian thoroughbreds
Insurance News
By Daniel Wood
“Our specialty areas include horses and livestock,” said Andrew McMellin (pictured above). “To be honest, it’s a pretty small market globally.”
McMellin is Markel’s London-based managing director of international wholesale. According to its website, the diverse Markel Group includes an insurance division but also building materials and bakery equipment companies. The company, headquartered in the USA, employs around 20,000 people worldwide.
The company reported gross written premiums of more than $10 billion in 2023, so horse and livestock insurance is not a large portion of the business.
“It’s probably our smallest area with a business value of about $60 million,” McMellin said.
Racehorse owners, stud farms and zoos
However, Markel’s offering still has an international presence in this sector. Racehorse owners, stud farms and zoos across England, Europe, the USA, Canada, New Zealand and Australia are among the company’s customers, and not just in the insurance sector.
“We do blood breeding and that can be anything from Arabian thoroughbreds to your pony legs,” McMellin said. “We have a livestock company in the US that deals with, for example, cattle and chicken farms, imports animal medicines and tries to sell them directly to farmers.”
Mortality risk coverage for horses and livestock
Insurance Business asked what type of insurance coverage a horse owner needs.
“There may be a risk of mortality if the horse dies,” McMellin said. “Stud farms can also insure their risks, so that the breeding stallions also cover the foals.”
He said these deals also include an element of liability insurance.
“If you run a pony club and visitors come to ride the ponies, they can be thrown off the pony and get injured, so this provides liability protection,” McMellin said.
He estimated that Markel has a horse market share with a focus on Thoroughbreds and a mortality risk of about 30%.
Chicken farms and hurricanes
Livestock insurance offerings also cover animal mortality, he said.
“For example, if they get diseases on chicken farms or if a chicken farm gets hit by hurricanes or storms, something like that,” he said.
Expensive horses have rich owners
One challenge, he said, could be convincing horse owners to buy insurance.
“Many horse owners don’t buy the cover because they don’t notice it [mortality] “It presents a particular risk,” McMellin said.
Other Thoroughbred horse owners, he said, are so wealthy they don’t see the need.
“If you look at the Arabian Thoroughbreds, they’re just so rich that they honestly don’t need cover,” McMellin said.
Markel also invests in some very expensive horses.
“We subscribe to some of the highly prized horses,” he said. “We have a small stake in a horse that I think is worth $50 million to $60 million.”
APAC expansion plans
McMellin said his company has major expansion plans for the Asia Pacific (APAC) region. The region’s business is currently worth around $140 million to Markel. The goal is to convert this amount to $500 million over the next five years.
“This is because we are expanding all of our key locations in Asia,” McMellin said. “For us it starts in Dubai, goes through Mumbai in India, Kuala Lumpur in Malaysia, Hong Kong, Shanghai, Singapore and now we have added Melbourne, Sydney and Brisbane.”
Think long term
In September, Markel’s on-site presence in Australia really took off with the opening of offices in Sydney, Melbourne and Brisbane.
Earlier this month, the company launched a professional liability (PI) insurance offering for Australia. According to a media release, reporting focuses on professional and financial risks in areas such as renewable energy.
Rory Morison, Markel International’s new managing director in Australia, said his company was taking a very long-term view.
“Firstly, we wanted to show our intent because one of the big questions is, ‘Are you serious or not?'” Morison said from Melbourne. “We also wanted to be very clear: ‘Yes, we are here for the long term.’”
“The long horizon that Markel aims for success as a company is to be a forever company,” he said.
Are you a broker in the horse and livestock sector? What are your insurance challenges? Please tell us below
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2024-04-25 18:42:22
www.insurancebusinessmag.com
