Editors’ Note

Nigel Mortimer will shortly take on this new role within Argo Group. He joined Argo in January 2009 and has served as Managing Director of International Specialty Insurance as well as Director of Product Development. Prior to joining Argo, he served as Senior Vice President of XL Insurance Company Limited, a subsidiary of XL Capital Ltd., after having served as Director of Product Development, Underwriting Manager, and Senior Casualty Underwriter in Bermuda. He has held several casualty management roles with Zurich Financial Services in Australia and the U.K. , and with Chubb Insurance in New York and London. Mortimer holds an Honors degree in Economics and Politics from the University of Hertfordshire.

How has Argo worked to build its presence in emerging markets?

We’ve done this by focusing principally on people and talent. We hire people who are looking for a career that will give them a greater sense of achievement rather than being a cog in a wheel – people who want to create the business rather than just manage one, genuine entrepreneurs with deep expertise.

We also felt it would be wrong to implant foreign expats into local regions. We wanted to attract people who had strong local relationships and strong local knowledge. Respecting and learning from other cultures is a key part of our business strategy.

How do you identify opportunities in emerging markets?

We look at the underlying potential of the markets, with particular focus on the growth of insurance penetration within the market itself.

In Brazil, for example, insurance penetration is half of what it is in the U.S., and MENA – the Middle East/North Africa region – is probably 10 percent of where we are in Europe and the U.S. There is real potential for growth in these areas and penetration is growing at double-digit percentages. They are expanding markets even if they are in a relatively flat GDP environment.

How critical is a culture of innovation and what areas are most affected?

We deal with a range of clients from small to large corporations. Many on the Fortune 500 have far greater financial strength and stronger balance sheets than many of the insurance companies they’re buying from. They’re looking to transfer risk but they are also seeking knowledge about what is going on in risk management in their industry segment to be in touch with a broader range of protection. We are great aggregators of knowledge, which means that we have a responsibility to use what we know and to act on what we see.

The frictional cost of doing business with the insurance industry is higher than what is accepted in many other industries. Innovation is going to come from more efficient mechanisms to distribute new products, understanding our clients’ needs to a deeper extent, and by being more audacious in our product development by removing some of the financial risks our clients have to self insure because the insurance industry struggles to understand them.

Going forward for us, key areas we will focus on include making our products mobile, digital, simple, and global.•